Broker Blog

Market Trends: We have added current Market Graphs and commentary to our website (www.winecountrygroup.com) for each of our Wine Country Markets. Whenever you need to know what’s going on in Wine Country, just visit our Market Trends web pages.

This month, there are some really pronounced milestones in the market. Please review the Market Analysis below, particularly for Sonoma County and Napa County – this is good news for our markets!

Wine Country Group Summary for October, 2009

We closed 76 transaction sides in the October, 2009, more than in any October since 2004 when we closed 83. This is 27% more than we closed in October, 2008 (60). The dollar volume ($33M) was 10% ahead of the volume last October ($30M). Our open sales for the month (74) were a healthy 61% of that for October, 2008 (46), so things are looking good moving into the mid Fall. Our listing inventory (224 units) is 10% ahead of a year ago (203) while in most of our market areas, inventory is down as much as 40% year over year. The average asking price ($929,000) of our current listings is 34% higher than this time a year ago ($695,000). Our pending sales at the end of October (136 units) total $74M in transaction volume compared to 84 units and $49M a year ago. Our agents are working hard to keep us ahead of the competition in most of our markets in year over year productivity.

We remain solidly number one in market share in our Sonoma Valley, Healdsburg and Cloverdale markets. In the past twelve months in the Sonoma Valley, we have closed twice as many transactions (231) as our nearest competitors and our agents have achieved a 27.3% market share. For the first ten months of this year, our Healdsburg agents have increased our market share to 25% from 18% for the first ten months of 2008.

Our Napa & St. Helena offices have generated a 31% increase in transaction sides (218) for the first ten months of 2009 compared to 2008. Our Napa County offices have increased their market share by 25% this year while our competitors have had flat or decreasing market share.

We respect the hard work that all of our agents are doing in these changing and tough times to help us to remain market leaders.

October, 2009 - Market Analysis

Napa County Trends: The inventory of homes and condominiums for sale at the end of October in Napa County (590) was 33% below the inventory (881) at this time last year and is the lowest inventory of available homes since March of 2006, three and one half years ago. New sales (154) were a whopping 60% ahead of the pace a year ago and were the highest monthly level since August of 2005. Of the 154 new sales in Napa County in October, 103 of them were in the City of Napa. This is a 87% increase in the number of sales in the City from this time last year and the highest number of sales in the City since September of 2006. This certainly signals strength in the local housing market. The average price per square foot of the homes closed in October was $270/sf, a 38% increase since February when the per square foot price was $201.00. The county in general is down to 3.8 months supply of inventory based on the current sales pace. American Canyon has just 1.4 months supply of inventory and the town of Napa has 3.4 months – so it is Up Valley Napa County that has an overhang of inventory. 31% of the available inventory in the county remains “Up Valley” at the end of October.

St. Helena/Up Valley Trends: The St. Helena/Up Valley market (Angwin, Calistoga, Deer Park, Rutherford, St. Helena and Yountville), had an inventory of 182 units at the end of October. This compares with 189 at the end of October, 2008, so it has been generally consistent throughout the year. Sales for the month (14) remained close to the level of last month and were 27% ahead of the number of sales (11) posted in October, ‘08. The Up Valley market seems to be gaining some traction at the end of this year. Available listings in Up Valley represent 31% percent of the overall Napa County inventory, a relatively high percentage. The average asking price of the current Up Valley inventory is $2.1M compared to the average price of the homes that closed in October being $1.0M so the high end remains the weakest segment of the market as in other Wine Country markets.

Sonoma County Trends: The inventory of homes and condominiums for sale (1,308) in Sonoma County at the end of October was 44% lower than a year ago. This is the lowest level of inventory in the County for any month since December of 2005. New sales (620) in October were 13% ahead of the pace in October, 2008 (551) and 17% ahead of that of last month (528). This is the highest level of new home sales in the County since August of 2005 – marking a new milestone in the housing recovery. The median price of homes closed in October in Sonoma County was $344,000. For the first time since June of 2006, the year over year median price was higher – in this case 3% higher. That means that the median price of sold homes has been lower on a year over year basis for over three years and now has reversed that trend.

The average price per square foot of properties sold in October ($244/sf) was equal to that of a year ago and 13% ahead of the low price per square foot ($216/sf) experienced in January of 2009. Indications are if you bought then, you have experienced some appreciation. The market seems to be certainly segmented and stuck in the higher ranges as the average asking price of unsold inventory is $1.1M compared to the average price of the units sold in October being $462K. Based on the current sales pace, there is only a 2.1 month supply of inventory.

Sonoma Valley Trends: The inventory of homes and condominiums for sale (181) in the Sonoma Valley (Sonoma, Glen Ellen and Kenwood) at the end of October was 21% below that for October, 2008, but it has be relatively steady since December of ’08 – ranging from 166 t0 200 units. There were 42 new sales for the month (compared to 35 a month ago and 33 in October, ‘08). The Sonoma Valley market also seems to be stalled in the higher end as the average asking price of the inventory is $1.1M compared to the average sales price of units sold in October being $462K. There were 31 closings in the Sonoma Vally in October and our Sonoma Valley offices closed 26 units. We obviously handled some outside of the Valley, but it seems we got a good share of the Valley closings for the month.

Healdsburg Trends: New sales (22) in October remained at a relatively high level and is 37% of the sales pace (16) a year ago. The inventory of homes and condominiums for sale (95) in Healdsburg at the end of October was slightly below that of last month (101) and it was 15% below the available inventory (112) in October, ‘08. This compares to inventory that is 44% lower in the County overall. Months of inventory based on current sales rate is 4.3. The Healdsburg market continues to show signs of rebounding.

Cloverdale Trends: Sales in Cloverdale for the month of October (13) remained about equal to the month earlier when there were 15 sales and was about equal with the 15 sales in October of 2008. The inventory of homes and condominiums for sale in Cloverdale (31) at the end of October, 2009 is about equal to that of last month and it was 66% lower than a year ago. It is the lowest level of available inventory since May of 2005 – four and a half years ago. There remains only a 2.4 month supply of inventory based on the current sales pace. The median price of the homes sold in Cloverdale in the month of October rose again to the 300,000 level which has been pretty consistent through the year. The median price of homes and condominiums sold in Cloverdale has bounced back from a low of $200,000 in March of this year.

Windsor Trends: The inventory of homes for sale in Windsor (49) at the end of October was 60% lower than the inventory (122) in October, 2008. There were 38 new sales of homes and condominiums in Windsor in October which is an increase of 31% from the level (29) in October ‘08. The current market has 1.3 months of supply based on the current sales pace. Prices have stabilized at slightly over $200 per square foot.

Solano County: Since we have closed 89 homes in Solano County this year so far, we keep an eye on the trends there as well. Inventory is down to 736 units – 72% lower than in October ’08. New sales for the month of October totaled 745 units – 27% higher than last year – and more than the number of available units at the beginning of the month (711). This creates just a one month supply of inventory at the current sales pace. The average price per square foot of closed homes for the month was $128.00, up each month from the low of $119.00/sf registered in April of this year.

Please contact me for additional information and copies of the complete TrendGraphix reports.

Management Training: Our first program in Management Training with Sandy Schaefer was a big success, so we are planning our next program. All agents manage their own business, if not an office, so everyone learns key skills from this program – particularly in leadership and planning. The next program will begin on January 15 and 16 and continue on the 22nd and 29th. We are subsidizing the cost to $250.00 per person including course materials. If you are interested in attending, please let me know.

Business Planning for 2010: It’s that time of year to plan for the coming year. Your office managers have business planning forms to assist you and I recommend you consider the following questions as you undertake setting your plans for next year:

1. Review 2009 by asking these questions: Did you meet your goals? If not, why not? Where did your leads come from? Where did your sales come from? How would you describe your situation now?

2. Write down your goals. I like what Stephen Covey says about starting with the end in sight. What numbers (income, houses sold, etc.) do you want in December of 2010? What specific steps will you need to take to reach those numbers? Who will hold you accountable for reaching your goals?

3. Analyze your operations. How do you accomplish your goals? Are you being efficient? Who will do your non-dollar productive activities? How do you handle leads now and what can you do to improve this? What do your key team members need so they can help you achieve the goals? Do you have an ideal weekly and daily schedule that helps your business run smoothly? Do you have systems in place that make overall operations run efficiently?

4. Evaluate your business strategy. Perform a SWOT analysis (What are your Strengths, Weaknesses, Opportunities and Threats for 2009?). How will you capitalize on your strengths and opportunities? How will you strengthen your weaknesses and deal with threats?

5. Examine your sales and marketing efforts. What marketing channels worked and which ones failed? Can you adjust the ones that failed and make them more successful? If so, how? Can you make the successful ones even better? If so, how? How will potential clients know you exist and when they realize you exist, do your marketing messages compel them to contact you? How will your ideal customer evaluate your services and make decisions? Are your scripts effective? If not, how will you make them more powerful? Do your scripts reflect the current market?

6. Get a handle on your finances. Do you have an accounting software package or system that gives you profit and loss statements, balance sheets and budget projections? Are you attaching costs to your efforts so that you can see if you’re getting the best return on your investments of time and money? Are you tracking your results?

Please let me know if I can assist you in anyway in developing your 2010 business plan.

FHA-Wine Country Group Kick-off: Save the date: January 29, 2010 for the Wine Country Group kick-off and Recognition Event. We will be returning to the Oakmont Golf Club and will have a fun time and an inspiring speaker. The program will begin at 8:30 am and run until 11:00. Save the date!

Staffing over the Holidays: Please be aware that our support staff will have a holiday on Friday, November 27th, following Thanksgiving.

Link to Home Buyer Credit info: Here's a link to CAR's outline on the extended Home Buyer Tax Credit. This includes higher income limits and non-first time buyers as well as first time buyers. Share this with your clients! http://www.car.org/newsstand/newsreleases/taxcreditextended/

Closings: Congratulations to the following for closings in the last thirty days: New agent to the WCG Liz Manfree (St. Helena) enjoyed her first closing with the firm. Wishing her many more!
Others with sales include: Carol Lexa (Healdsburg); Herb Heil (Sonoma); Terri D’Amico (Sonoma); Charlie Laughlin (Napa); Helaine Forte (Napa); Bill Streett (Sonoma); Diane Krause (Sonoma); Joyce Davison (Sonoma); Erin George (Sonoma); Susan Irvine (Sonoma); Alicia Robledo (Sonoma); Howard Powell (Sonoma); Gina Clyde (Sonoma); Faeli Vyn (Napa); Frank Lazzarotto (Sonoma); and Hank Lane (Healdsburg).

The following agents had two closings in this period: Sheila Deignan (Sonoma); Lark Raymond (Napa); Mari Johnson (Sonoma); Leo Merle (Sonoma); and Jane and Ron Pavelka (Healdsburg/Cloverdale).

Corrie Sterbentz (Sonoma); Lisa Smith (Healdsburg) and Susan Montgomery (Healdsburg) had three closings each.

The Foss Creek Condominium team (Lisa Albertson, Gina Clyde, Susan Montgomery and Amanda Stampley) had four closings for the month. Also with four closings were David Barker (Napa); Lisa Albertson (Sonoma/Healdsburg); and Jana Jones (Healdsburg).

Daniel Casabonne (Sonoma) and Doug Del Fava and Susan Parker (Kenwood) had six closings each during the past month.

And, Cheri Stanley tops the bill with nine closings in the past month – over two a week – a healthy pace!

Congratulations to all.