Marin County real estate statistics for the 1st quarter of 2009 indicate that we have hit the bottom of the market. I say this because prices have declined for one of the few times since we began keeping records in 1965. From 1965 through 2008 prices have appreciated every year except 1992-1993 and 2008. The 1st quarter of 2009 shows a sharp decline in both average and median prices in some of our most desirable communities (i.e. Tiburon/Belvedere and Mill Valley) compared to the 1st quarter of 2008. This price depreciation is offset by an increase in sales volume. For example, Mill Valley had a 25% decline in average price but a 13% increase in the number of homes sold. Historically, when this happens, it typically represents the bottom of the market. Prices decline to a point where qualified buyers recognize prices are at a level they have not seen for several years. Consequently, buyers start making offers and we get some momentum in our market. For all of Marin County, prices declined by 44% and sales volume increased by 17%. This phenomenon started at entry level prices which are up to $500,000. That market is currently very active with multiple offers occurring often. The $500,000 to $1 million price range has picked up significantly in the 1st quarter. The $1 to $2 million price range is improving slowly. The $2 to $3 million range is still stagnant. The over $3 million price point has held its own in this real estate recession. The number of sales over $3 million has been relatively steady since 2003.

This chart shows average prices from 1965 through 2008. As you can see, prices have declined very few times during the last 43 years. 1992-1993 declined minimally (less than 1%). The 2008 drop was fairly steep (about 12 %) and so far 2009 looks like another decline. Historically, when prices have declined or remained flat (see 2001), this short downturn has been followed by a long steady rise in prices (appreciation). Given the fact that demand for Marin real estate is always strong and that our supply is limited, I believe our time at the bottom of this downturn will be short lived.

Therefore, if you are a qualified buyer and you are fortunate enough to find a home that meets your criteria, you should buy it. If not, there could be somebody right behind you ready to submit an offer.

Posted by:Andy Gellepis