July 2024 Market Report Newsletter

July 2024 Market Report Newsletter ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏ ͏

Despite experiencing the fastest Fed rate hike cycle in four decades, the U.S. economy has proven more resilient than in past economic cycles. One reason some economists believe this resilience exists is the greater buffer homeowners now have from spiked interest rates: Not only is 96% of mortgage debt in the U.S. fixed rate, but 38.5% of homeowners don’t have a mortgage at all. Unlike their homeowner counterparts in countries like the United Kingdom and Canada, the vast majority of U.S. homeowners aren’t seeing their payments adjusted to the new market rates. 

Additionally, the fact that many U.S. homeowners have no debt at all means that if they need to sell and buy a different home, they might be able to roll over the equity, buy it in all cash, avoid spiked interest rates, and avoid having to cut back on their discretionary spending, thus keeping the economy warmer. Between 2010 and 2022, the share of owner-occupied homes without a mortgage jumped from 32.1% to 38.5%. Why did the number increase so much? It boils down to the fact that older homeowners tend to be the ones with paid-off mortgages, and over the past decade, the U.S. population has aged as the massive baby boomer generation has entered its senior years. Indeed, over half of mortgage-free homeowners are baby boomers.

 On a regional level, regions with greater affordability and areas with a higher proportion of older populations tend to have a higher percentage of homeowners without mortgages. Since 2022, all-cash home buying, as a percentage of home sales, has increased, as many of these mortgage-free homeowners carried over equity to avoid taking on these higher rates. In Q1 2022, 25.8% of home purchases were made in “all cash,” according to Parcel Labs. In Q4 2023, 33.5% of home purchases were made in “all cash.” Source: Fast Company

As baby boomers increasingly seek to age in place in their own homes — a scenario supported by both the preferences of older homeowners and the realities brought on by elevated mortgage rates — this is clashing with the desires of millennials who wish to enter the housing market, as the combination of limited inventory and high costs are keeping these buyers on the sidelines of the mortgage market. This is according to a recent column published by Fortune, which examined the dynamics that could contribute to boomers staying in their homes longer while many millennials are challenged to enter the housing market in the first place. Data shared with the outlet indicated that baby boomers make up roughly one-third of all U.S. homeowners. 

They have added incentive to stay where they are — particularly if they have a low, pre-2022 mortgage rate or their home is paid off, the column stated. “In our current environment, where mortgage rates skyrocketed from historic lows throughout the pandemic to a more than two-decade high in October last year, being mortgage-free is like hitting the mother lode,” the column read. “It’s partly why boomers aren’t moving — because why give up no mortgage rate, or a substantially lower one, for one that’s in the 7% range plus a higher monthly payment?” Other factors are keeping millennials on the sidelines. The salary needed to buy a starter home, for instance, has nearly doubled since the start of 2019, according to data from Redfin. Meanwhile, inventory levels remain at historic lows that contribute to a severe lack of affordability across the country. On top of this, baby boomers are holding onto their larger homes that feature three bedrooms or more, according to data published by Redfin in January.

 While these factors combine to incentivize baby boomers to remain where they are, older Americans also may be making the choice to age in place based on comparisons with other options, such as dedicated long-term care or senior housing facilities. By and large, seniors are opting to remain in their homes — and even to undertake significant renovations to them — to avoid moving to such facilities, according to recent reporting from The Associated Press. But not all boomers and millennials are locked into this dynamic. Recent data from the National Association of Realtors (NAR) also showed that millennials recently surpassed baby boomers as the largest homebuying demographic. “The generational tug-of-war between millennials and baby boomers continued this year, with millennials rebounding to capture the largest share of home buyers,” Jessica Lautz, NAR’s deputy chief economist and vice president of research, said in the report. Source: HousingWire

Warmly,
Sharon

— Market Report —

Report Highlights

The Marin median house sales price in Q2 2024 was unchanged from Q2 2023. The median condo sales price ticked up slightly. 

The number of new listings coming on market in Q2 was up about 14% year over year and the number of homes for sale on July 1st jumped 32%. Substantial increases in inventory will typically cool the market and moderate home price appreciation, if there is not a commensurate rise in sales activity. 

Q2 home sales declined about ½ of 1% year over year, while homes selling for $4 million+ rose 3.5%: Generally speaking, very affluent households have been playing a larger role in the housing market since late 2023 (when financial market began their rebound).

The average home sale closed for 1.5% over the list price in Q2 2024, while median days on market dropped to its lowest reading since spring 2023.

The number of price reductions in June 2024 leapt 50% year over year, an indication of some sellers having to readjust expectations regarding what buyers are willing to pay. 

As of early July, mortgage rates continue to hover around 7%, though hopes remain for at least one reduction in the Fed's benchmark rate in 2024. Stock markets have sustained their extraordinary rise. The homeowner's insurance situation remains challenging, with policies often difficult to locate and increasingly expensive. The latest Census estimates revealed the Bay Area is growing older, with fewer children and a rising number of residents aged 65+.

— Cleaner California Coast —

— Success Story — 

Sharon lead us through the process of selling our home, from beginning to end, with patient professionalism. Calling upon her many years of experience, representing buyers and sellers in this area, and her contacts with local businesses, she helped us prepare our home for sale with efficient and meticulous precision. 

She carefully orchestrated renovations that would aptly add value without overspending and she managed the entire process for us, while carefully communicating along the way. And this was all before we were ready to market and sell the home! She achieved a remarkable sale price for us, through her thoughtful pricing, her thorough, effective and beautiful marketing efforts, her on-site presence and her keen eyes and ears, plus much, much more! We are so glad that we chose Sharon to be in our corner representing us on our sale. 

The results were outstanding and I would not consider working with any other realtor again. Who you choose to represent you really does matter and  I can assure you, if you choose Sharon, you will not regret your choice!

- Lisa Preger, Mill Valley Home Seller

— National Network —

Looking for a primary residence, second home, or investment property outside of Marin? I am connected to some of the best agents in the country and would love to make an introduction!

Mill Valley
95 Eldridge Avenue

5 BD 4BA 3,186 SF $6,200,000

This beautiful Blithedale Canyon home was listed at $4,995,000, received multiple offers and sold at $6,200,000.

My sellers are delighted to have sold for 24%,  $1,205,000 over asking!

For more information on the anatomy of this sale click here
.

Mill Valley
11 Elma Street

4BD 4.5BA 3,277 SF $6,000,000

11 Elma Street in Mill Valley, sold swiftly and quietly in an off market sale.

We listed this spectacular downtown home at $5,495,000, and I secured a buyer at $6,000,000, 9% over asking, in just 2 days.

My sellers are delighted to have made 54 % appreciation in just 6 years!

Mill Valley
170 Bayview Drive

2 BD 2BA 1,440 SF $1,075,000

This modern home was designed in 1974 by renowned architect Steve Wisenbaker. 

Offering a unique design, views and privacy, my talented buyer snapped up the opportunity to take on this exciting project, which provides her with the template for a stunning remodel to transform the space.

I cannot wait to see her work in progress!

Larkspur
21 Bayview

4 BD 3 BA 2,623 SF $3,295,000

Nestled in the highly sought after Lower Palm Hill neighborhood in Larkspur, my buyers are delighted to have snapped up this wonderful family home to raise their young family in. 

Offering a perfect blend of traditional charm and contemporary finishes, a wonderful back garden and indoor outdoor flow and such a convenient walk/bike to town or school community.

Mill Valley
2 Chaucer Court

3 BD 2BA 1,356 SF $1,225,000

Newly renovated Shelter Ridge townhome featuring vaulted beam ceilings, 3 decks, and a 2-car carport with storage.

Shelter Ridge complex offers a fantastic community with pool, spa, tennis courts, playground and club house and in a convenient location near Hauke Park.

— Available Homes —

Want to be in the know?

Visit my website to see my current listings and sold homes, as well as many testimonials, my newsletters, 
and more!

Check out Coming Soon properties in 
Marin

Check out Compass Luxury Curated 
Magazine

I am extremely proud and honored to have been named as one of the verified Real Trends top 1.5% of real estate agents in the Country again. 

I am deeply grateful for the trust and support of my amazing clients, colleagues,  family and friends. I owe this achievement to you all and thank you for choosing me to represent you in your real estate journey.

Compass is a real estate broker licensed by the State of California operating under multiple entities. License Numbers 01991628, 1527235, 1527365, 1356742, 1443761, 1997075, 1935359, 1961027, 1842987, 1869607, 1866771, 1527205, 1079009, 1272467. All material is intended for informational purposes only and is compiled from sources deemed reliable but is subject to errors, omissions, changes in price, condition, sale, or withdrawal without notice. No statement is made as to the accuracy of any description or measurements (including square footage). This is not intended to solicit property already listed. No financial or legal advice provided. Equal Housing Opportunity. Photos may be virtually staged or digitally enhanced and may not reflect actual property conditions.