Novato Real Estate Market Update (September 2009 Home Sales Report)

September 17, 2009 by  

I have written in past months about the high level of competition in Novato, California’s entry level real estate market. This trend continues into Q3 2009. In August 2009, 38 Novato homes sold. This is down from 47 sales in July and the same as in June. Many of these sold properties were bargain basement homes that were in some of distress. But, the inventory continues its rapid absorption as pent up demand, historically low interest rates, the First Time Homebuyer Credit, and increased affordability carry the day.

Continuing on a trend noted last month, the average sales price of Novato homes rose. In August 2009, the average price for a Novato home was $ 713,440. That is up from $632,078 in July  and from $622,000 in June. While this large bump may be anomolous, the fact it follows a bump last month may prove significant. Certainly, the psychological impact on buyers waiting for bottom to hit may prove significant.

As a result of the above, we believe that the move-up market will continue to improve in Novato — there are clear signs of improvement in this very important market segment. As of today, here are the percentages of homes in escrow in each price band:

  • 81% of homes priced under $500,000 (essentially the same as last month);
  • 66% of homes between $501,000 and $600,000 (up from 61%);
  • 48% of homes between $601,000 and $750,000 (up from 40%);
  • 27% of homes between $751,000 and $1 million (same as last month);
  • 30% of homes between $1 million and $1.5 million (same as last month);
  • 0% of homes between $1.5 million and up (down from 6%).
Interestingly, and in line with recent months, the move-up price bands are selling nearly as well as the entry level properties:
  • 17 homes priced under $600,000 sold in August 2009
  • 16 homes priced from $601,00 to $1 million sold in August 2009
Bucking the norm for this time of year, inventory is actually down from August. There are 127 single family homes currently for sale in Novato, CA (there were 138 in August 2009).
Novato’s absorption rate (e.g., the number of months of inventory currently available in Novato) remains extremely low. In March 2009, we had 7.9 months worth of inventory. This month, our absorption rate has fallen to an unbelievable 3.3 months! Generally speaking, 6 months of inventory reflects a balanced market and anything under 4 months, a seller’s market. It is rumored that more bank owned inventory will be generated later this Fall as banks continue hiring processors and moratoriums are lifted. We will see if this comes to pass and how it affects our market. For now, Novato’s housing market looks quite strong.

Real Estate Market Chart by Altos Research www.altosresearch.com

As noted above, 38 Novato homes sold in August 2009. These Novato homes averaged about 83 days on market, were about 2,360 sq. ft., and sold for an average sales price of $713,440 (roughly $305 per sq. ft.). Homes in Pointe Marin, Country Club, Hamilton Field, Rush Creek, and Bel Marin Keys generated the most calls and showings this past month. If you are thinking of buying, please call my office at (415) 350-9440 as I have a long list of people who would like to sell their homes, but because of market conditions are not quite ready to list their home officially. I am also receiving many calls regarding lease-options.

Below is a breakdown of the Novato real estate market by price band:

Price Range

Total Homes

Pending Listings

Up to $500K

48

81%

$500K – $600K 38 66%

$600K – $750K

44

48%

$750K – $1 mil.

59

25%

$1 mil. – $1.5 mil.

33

30%

$1.5 mil. & Up

15

6%

If you would like me to run the exact numbers for your Novato neighborhood or if you have any questions about Novato’s many delightful communities, just give me a call at (415) 350-9440. My name is Kyle Frazier. I am a Broker, Certified Residential Specialist (CRS), and Member of The Institute of Luxury Home Marketing, with Christie’s Great Estates | Morgan Lane International Real Estate. It is always my pleasure to be of service.

Now that the the HWY 101 widening project has been completed on both north and southbound lanes, the commute through San Rafael is very much improved. Southbound commute traffic is reduced by about 25 minutes. The improved commute will certainly make Novato a preferable choice for those who want more house for the money, yet were scared off the traffic we experienced during the highway construction period. Moreover, the first-time home buyer credit of $8,000 (this is a flat out gift from the government) certainly helps those who qualify. As I tell my clients, “Give Yourself a Raise. Move to Novato.”

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One Response to “Novato Real Estate Market Update (September 2009 Home Sales Report)”

  1. Novato Real Estate Market Update (September 2009 Home Sales Report) | Marin Real Estate -- Homes For Sale on September 17th, 2009 3:05 pm

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