Sonoma County home buyers signed sales contracts for low-priced short sales and more expensive houses last month at a level reminiscent of the days before the housing bubble deflated five years ago.
Buyers signed contracts to purchase 583 single-family homes in February, up 62 percent from a year ago, according to The Press Democrat’s monthly housing report compiled by Pacific Union International Vice President Rick Laws.
That was the most contracts signed for any month in at least three years. It likely was the best February since 2005, Laws said.
Not all the contracts will result in completed sales. Even so, real estate brokers are taking comfort that more deals are being signed in the price segment between $400,000 and $900,000, where sales have been sluggish since at least 2009.
To date this year, buyers have signed contracts for 277 houses in that price range, up 56 percent over the same period a year ago.
“This activity level has permeated nearly every price range,” Laws said. It’s a contrast from recent years when “people were just not coming to the party.”
In February, the county reported 352 completed sales, up nearly 15 percent from a year earlier.
The median home price fell 3 percent from a year earlier to $314,950. It was also down 3 percent from January.
County home values peaked in 2005 with an annual median price of $595,000. Prices began their slide in 2007 and hit a new low last year of $325,000, a level last seen in 2000.
Last month buyers signed contracts for a record 216 short sales, an increase of 177 percent from a year earlier. For the past six months, the number of short sale contracts has nearly doubled compared to a year earlier.
A completed short sale means the home was sold for less than the amount owed on the mortgage. In the past six months, the county has reported 545 completed short sales, up 33 percent from a year earlier.
Half of all homes sold last month were foreclosures or short sales.
February ended with 1,031 homes for sale, the smallest number in almost seven years and roughly a three-month inventory at the current sales pace.
Many agents and brokers see the increasing number of signed contracts and the declining inventory as signs that the market is stabilizing.
But C.J. Holmes, owner of CJ Holmes Brokerage in Santa Rosa and a leader in the new local group Homeowners for Justice, said it will be difficult for prices to rise with so many foreclosures and short sale properties coming to market.
“I do see lots of strong head winds,” Holmes said.
— Robert Digitale