The second quarter of 2019, while down slightly from a record-setting first quarter, shows a continual trend of rising home prices here on the coast, although at a slower pace. Sales volume was down this half, inventory is rising and average selling time is up over last year. The good news is mortgage rates are down and stock market is up.
Prices for the second quarter topped $1.3 million. That has been true for five of the last six quarters. Average home price for the coast now stands at $1,351,000, up 1 percent from first half of last year and up 2 percent from full year 2018.
Prices ranged from $490,000 for a 740-square-foot cottage in Pescadero to an oceanfront home in Montara selling for $3.8 million.
Sales volume is down 7 percent from the first half of last year. One-hundred-twenty-five homes sold this half compared to 135 in 2018, 136 in 2017, 117 in 2016, 147 in 2015, 52 in 2009 (our worst year), and 206 in 1999 (our best year). Volume is down 7 percent from 2018 and down 39 percent from 1999. Distressed sales are down too. There were no such sales this year.
Rising inventory (see my column of July 10, 2019) could be a limiting factor to volume growth. Available inventory is rising while homes sale-pending is low. This is particularly true for homes priced over $1.5 million. As of June 30, there were 107 total listings of which 76 were available and 31 were sale-pending. Inventory is up 26 percent over same time last year.
Not surprisingly, these factor have contributed to homes selling more slow. Average selling time has increased to 44 days now from 35 days in 2018, 43 days in 2017, 48 days in 2015, 134 days in 2011, and 51 days in 2005.
Fifty-five percent of all sales occurred in less than 30 days. Forty-three percent of all sales in 2005 went over list price compared to 9 percent in 2009, 11 percent 2011, 20 percent in 2012, 38 percent in 2016, 44 percent in 2018. Now 24 percent sell for over list. Homes sold this half for 98 percent of list price compared to 101 percent last year.
This chart shows average home prices by quarter from 2007 to present. As you can see, record levels remain.
Based on what’s sold and sale-pending, I expect the third quarter to look good in term of prices with volume softer and inventory rising as is customary for this time of year.
Steven Hyman is the broker and owner of Century 21 Sunset Properties. He can be reached at 726-6346 or at www.century21sunset.com