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

October 15, 2009

Entering into the dormancy season for Marin County real estate, it appears that certain “hotspots” remain — Novato is one of them. In September 2009, 35 Novato homes sold, compared with 38 sales in August 2009. The Novato real estate market derives its strength from entry level home sales. The number of homes actively listed in Novato remains very low compared with the rest of Marin (and the percentage of homes in escrow is much higher than the rest of Marin) because of exceptional demand based on affordability and the ongoing fantastically low interest rates.

“Give Yourself a Raise. Move to Novato.”

While the average sales price of Novato homes rose in August to a remarkable $713,440 (based in large part to the makeup of sales), that number fell back to Earth in September — $646,389. Even so, the psychological impact on buyers waiting for bottom to hit has begun to register. Anecdotally, I can attest that many buyers are looking at the inventory of homes in Novato and acknowledging that prices in the lower price bands are level and that it is increasingly difficult to identify “turnkey” homes under $525,000 — $550,000.

Below are the percentages of homes in escrow in each of Novato’s major price bands:

  • 73% of homes priced under $500,000 (down from 81% last month — due to a flood of 6 homes coming onto market in the last week);
  • 66% of homes between $501,000 and $600,000 (same as last month);
  • 53% of homes between $601,000 and $750,000 (up from 48%);
  • 34% of homes between $751,000 and $1 million (up from 27%);
  • 31% of homes between $1 million and $1.5 million (up from 30%);
  • 0% of homes between $1.5 million and up.
Importantly, and in line with recent months, the move-up price bands are selling as well as the entry level properties:
  • 16 homes priced under $600,000 sold in September 2009
  • 15 homes priced from $601,00 to $1 million sold in September 2009
This trend also coincides with the extraordinary high percentages of homes in escrow. Meanwhile, inventory continues to shrink with just 120 single family homes currently for sale in Novato, CA. Compare this with Mill Valley which has 119 homes actively on the market, yet Mill Valley has about one-quarter the population size of Novato.

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

Novato homes that sold in September 2009 averaged 121 days on market, were about 2,133 sq. ft., and sold for an average sales price of $646,389 (roughly $313 per sq. ft.). Novato’s absorption rate (e.g., the number of months of inventory currently available in Novato) remains extremely low — 3.4 months of available inventory. In March 2009, we had 7.9 months worth of inventory. Generally speaking, 5-6 months of inventory reflects a balanced market and anything under 4 months, a seller’s market. The percentage of homes in escrow also points strongly to an extreme sellers market in the lower price bands.

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 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 a Certified Luxury Home Marketing Specialist (CLHMS), with Christie’s Great Estates | Morgan Lane International Real Estate. It is always my pleasure to be of service.

Filed Under Novato Homes & Real Estate Reports · 1 Comment