Sonoma County, California “under contract” sales tipping towards “regular sellers” and NOT the “distressed Marketplace”–could bode well for “move-up” market as regular sellers see value and low interest rates as a reason to make a move. See Chart below–I’ll explain this!
The above chart shows sales going back three years and is broken down into “Quarters” of the year. This report breaks out the Non-Bank portion of the marketplace or what Realtors call “Elective or Regular” sellers–those who DO NOT have a gun to their head (short-seller) or who own a property through the foreclosure process (bank owned or REO). If you go back to 2008 you can easily see how the “Distressed” market dominated sales (Q4,Q1 2008-2009). Now look at the last two quarters of 2011. One can easily see how the “regular” buyer market has rebounded. This can indicate a number of things; the distressed properties are NO longer dominating the listing landscape, “Regular” buyers are finding great value in the normal marketplace, consumer confidence is rising as “regular” buyers are once again on the move, interest rates are just TOO darn good! (3.75% FHA!).
Why is this a good thing? The Mid-range marketplace ($400,000 to $750,000) has been suffering as the dominate “Sellers” where “Distressed” meaning they were NOT buying anything when they sold. REO’s or the banks are NOT buying in the marketplace after seller and neither are those selling their homes “Short”. This surge in the “under-contract” marketplace of regular buyers indicates perhaps a move to this “mid-range” marketplace. We will need to watch this category to determine what price point is inherent in these numbers. But this portends of good things to come!