The Sonoma County housing market oscillated during some big swings in mortgage rates that occurred during the last quarter of 2023. Starting at $850K in October the median price for a home dropped to $792K in November, as 30 year fixed mortgage rates climbed to about 8%. Then, on good inflation and job news, lenders began easing rates in anticipation of a reversal in Fed policy, and some borrowers were able to finance a purchase in December near 6% - a big drop. This led to a bump in the median price in December to $813K. The average price per square foot also moved down and up in the same manner. Over the entire quarter, taking these market swings into account, the average price per square foot that buyers paid for a single family home was $564.
During 2023, there were more homes on the market than in the prior year. But during the last quarter of 2023, inventory of available homes fell sharply, landing at the lowest level seen in almost 2 years. Borrowing costs have crept up since December on news that the Fed will not be slashing interest rates as aggressively as we had hoped. However, we do anticipate that mortgage rates will improve modestly over the course of 2024. Combined with very limited inventory and a fresh crop of buyers who enter the market in the new year, the spring market is sure to be quite robust.
For buyers, that means likely competing for homes that present well and are priced competitively. And for sellers who prepare their properties for market and price appropriately, 2024 will offer good opportunities to sell for top dollar.
For specific data on your neighborhood or another property category, or for a market evaluation of your home, please reach out and I'd be glad to offer guidance. I am here to help you!
Median Price, Single Family Homes - Sonoma County Through Dec 2023
Average $/SF, Single Family Homes - Sonoma County Through Dec 2023
Months Supply of Inventory, Single Family Homes - Sonoma County Through Dec 2023