More Sellers are putting their homes on the market over the past several months because they think prices won’t get better anytime soon. Inventory has ballooned in August to the highest levels since 2011 and that means there are finally more choices for buyers, who are becoming more cautious about overpaying for a property. This means the crazy real estate market appears to finally be showing signs of slowing.
There were 471 single-family homes that sold in Sonoma County in August, a decline of nearly 10 percent from a year earlier.
The bottom line is that there are fewer offers and overpriced homes are not selling. This has resulted in more sellers who are cutting their prices, something we haven't seen much of during the past 6 years. New listings have increased 8 percent so far in 2018 which has led to the largest inventory of homes for sale since 2011. August ended with 1,138 single-family homes for sale, which is an increase of 36 percent from August of 2017.
Another sign the real estate market is starting to slow down is that 60% percent of the single-family homes in Santa Rosa have been on the market for more than a month and have not yet sold. At first glance, that doesn't sound very significant since historically three to six months would be considered an average marketing time for the averaged priced home; but it is very unusual for a housing market that has so recently featured a tight inventory and very strong demand.
The market slowdown appears to be happening statewide, with August home sales declining nearly 7% overall from a year earlier, according to the California Association of Realtors. It is likely that buyers are being cautious and reluctant to make a commitment as they are concerned that home prices may have peaked and instead are waiting until there’s more clarity in the direction of the real estate market.
Sellers are now hearing about price reductions, and many of them are wondering whether the pricing downturn will last for several years. Consequently, many sellers have concluded that If they're going to sell, they should sell now.
For the past six years, Sonoma County sellers have looked at comparable home sales and then asked even more money for their own properties. Now agents are recommending pricing below the last price that sold and of course, sellers are not happy to hear that. This does provide an opportunity for all of the buyers who have been priced out of buying a home for the past 3 or 4 years; the current market trend finally gives them an opportunity to own a home.