The three most important things in real estate have always been location, location, location. As it turns out, those are also the keys to having a thriving business as a real estate agent, according to a recent article in Realtor.com, the publication of the National Association of REALTORS®.
Realtor.com reported on a study by WalletHub that compared the 150 largest cities across 13 key metrics, such as sales per agent and the annual median wage of agents, to find out the best places for real estate pros to practice. The results: Denver came out #1, and Colorado boasted three of the top 10 markets for agents (including Aurora and Colorado Springs). But San Francisco also was in the top 10 at #8.
Here are the top 15 markets for agents:
1. Denver, Colo.
2. Irvine, Calif.
3. Seattle, Wash.
4. Austin, Texas
5. Aurora, Colo.
6. Portland, Ore.
7. Indianapolis, Ind.
8. San Francisco, Calif.
9. Colorado Springs, Colo.
10. Boston, Mass.
11. Grand Rapids, Mich.
12. Boise, Idaho
13. Honolulu, Hawaii
14. Raleigh, N.C.
15. Madison, Wis.
If Realtor.com had gone beyond the top 15 they would have included San Jose (#20), Fremont (#22), Oakland (#35), and Santa Rosa (#43) in the top 50 cities in America to be a real estate agent. And because they only focused on the 150 largest cities in America, they didn’t include a number of hot suburban housing markets in places like Silicon Valley and the East Bay.
Of course, real estate is also intensely local. Researchers found that Knoxville, Tenn. (which ranked 34 overall) had the highest number of sales per agent at 120 – about 20 times more than Houston, which had the lowest at an average of 6 sales per agent. Indianapolis (which ranked number seven overall) had the highest annual median wage for real estate agents at $105,370 – four times greater than in Wichita, Kan., which had the lowest at $24,320, according to WalletHub’s findings.
You can find the full report here.
Below is a market-by-market report from our local San Francisco Bay Area offices:
North Bay – Novato area properties in the $1 M to $2.5 M range have started selling after sitting through the late fall and winter months, with homes in the $1M to $1.5 M range moving more rapidly. There are currently 13 homes in Novato that are active with a price point over $1 M. There is pent up buyer demand at the higher price points in northern Marin. Buyers and agents are anxiously waiting for new inventory to hit the market. There have only been a handful of new listings on the Broker’s Tour the past few weeks. The few homes that come on at the median Novato market price are selling quickly, over asking, with multiple offers. The spring sales season has not started yet, but it appears to be off to a slow start, according to our San Rafael manager. As of March 1st San Rafael has 47 active single-family listings and 33 pending or 41% under contract. Marin County has only 187 active single-family homes for sale and 124 pending or 40% under contract. Inventory is still at a record low. The Santa Rosa area market is still listing short, driving prices higher and buyers crazy. Multiple offers and over asking price is the norm. If a new listing sits on the market for more than a few days there is something wrong and it is almost always the asking price. It’s still early in the year for the luxury market to emerge, but agents are starting to see some movement. We are finally seeing the inventory grow in the Sebastopol area, but it still remains very competitive for buyers. Agents report multiple offers in the teens and it is not unusual to have 30-40 groups come through open houses. There is lots of activity and a few new listings in the Previews luxury market. The Southern Marin market is just beginning to show increased activity as evidenced by multiple offers and overbids, but not yet at the pace of the last two years. The luxury Previews market continues at a slower pace than the last two years. However, it is early 2016 and we expect the pace of luxury sales to pick up and get back to where we were in 2014 and 2015.
San Francisco – Our San Francisco Lakeside office manager says everyone still seems to be waiting for the logjam to break up. Listings are scarce and multiple offers are rampant. Our Lombard manager reports February was a better than expected month for open transactions, but the inventory increase has been disappointingly slow. The entry market is much more robust than the high-end market, where we are seeing more price reductions and longer days on market. A report this week on closed condo sales indicated more than half were at, or under asking – something we wouldn’t have seen 6 months ago.
SF Peninsula – The Burlingame area market has picked up from the seasonal holiday slowdown, our manager reports. Across the hill in Half Moon Bay, properties that have been on the market for some time are receiving multiple offers. Homes priced below $1.2 million are selling quickly with multiple offers. The market is still very tight in Menlo Park and Palo Alto. A new listing that is coming available and was introduced at the Monday meeting is many times sold before hitting the MLS. Agents are stretching to other areas to find listings, which are also scarce. A new Menlo Park listing at about $4 million had 80 people through on this last weekend. The very scarce market from $1 to 1.5 million is still very, very active. Lack of inventory is still causing a lot of frustration for both clients and agents, reports our Redwood City-San Carlos manager. When there are multiple offers there are fewer offers – in most cases just two or three. Unless someone is moving out of the area it is difficult for them to be convinced that they will be able to find a replacement property. The San Mateo area market has picked up. Inventory is low but improving. Woodside is still quiet. The high-end market is moribund right now. There are buyers there but no one buying.
East Bay – Berkeley’s inventory is still historically low but this is the lull before the storm, according to our manager. We have many properties coming onto the market in the next few weeks. Berkeley currently has 38 available properties and almost every listing has multiple offers. One agent in the Berkeley office received 15 offers on a 660sqft 1bd condo and sold for almost $1,000 sqft. Another property sold off market for 25% over list price. Berkeley has not experienced the slower market predicted for 2016 yet. The time to sell is now. The market has begun to heat up in the San Ramon Valley after a quiet December and January. We are seeing multiple offers in every price range.
Silicon Valley – Activity is definitely picking up in the Cupertino area, and inventory is increasing as well. Our local manager says homes that recently would have received 10+ multiple offers are now getting 2 or 3. Buyers with limited down payments have a chance, unlike a month or two ago. Los Altos February property sales were 14, down from 29 sales in February 2015 although, 75% higher than the eight sales this January. February 2016 sales were at historically low compared to February of 2014 as well. February YTD sales of 22 are running 54.2% behind last year’s year-to-date sales of 48. The median sales price in February was $2,812,500, down 15.0% from $3,310,000 in February of 2015 but up 10.7% from last month. The total inventory of properties available for sale as of February was 41, up 78.3% from last month and up 51.9% from February of last year. If a home is priced under $3M, and priced right, it’s out the door with multiple offers. Los Altos Hills February property sales were a slim 3, down from 11 in February 2015 and flat compared to the 3 sales in January 2016. There are six YTD, down 62.5% from last year’s year-to-date sales of 16. The median sales price in February was $3,100,000, down 16.2% from $3,700,000 in February of 2015. February 2016 ASP in the middle compared to February of 2015 and 2014. The inventory of properties available as of February was 31, up 55% from last month and 158.3% from last year. Properties priced over $4M are lingering on the market and are taking longer to sell. There were 13 sales in Sunnyvale in February, down from 30 in February of 2015 and 35.0% lower than the 20 sales last month. The median sales price in February was $1,616,000, up 27.0% from February of 2015 and up 23.1% from last month. Inventory in February was 30, up 57.9% from last month and up 15.4% from last year. Again, we experienced robust sales activity for properties priced under $2M, selling with multiple offers. In Los Gatos, buyers are encouraged as more inventory is hitting the market. The beginning February was rather slow in the San Jose Almaden area, but the market really picked up in the 2nd half of the month. The median sales price in Almaden was $1,235,000, down 2.8% from February of 2015 but up 17.6% from last month. The median sales price in Blossom Valley was $755,000, which is up 17.6% from February of 2015 and up 13.9% from last month. The median sales price was $862,000, up 10% from February of 2015 but down 15.1% from last month. Santa Teresa had a median sales price of $735,000, up 12.2% from February of 2015 and up 8.9% from last month. Cambrian had a different outcome from the other 3 markets. The median sales price was $862,000, up 10% from February of 2015 but down 15.1% from last month. Willow Glen was hungry for new listings and the market delivered. There were 57 total active units this past week, a high from last fall. Open house traffic has been consistent but not crazy. We have had some buyer push back on a few properties that agents were anticipating multiple offers well over asking. Saratoga properties over $3 million that didn’t sell last year are selling this year within a week of hitting the market again. Inventory is beginning to grow slightly. Agents are seeing some listings coming on the market (in certain areas) and dropping the offer date dialogue.
South County – The inventory shortage continues in South County. As of March 1 there were only 59 single family homes listed for sale in all of Morgan Hill (and 30 of those were listed for over $1 million). Gilroy inventory was a little better with 68 homes available with only 20 of those listed over a million. There does, however, seem to be some light at the end of the tunnel. During the past several weeks South County agents have been able to bring more homes to the market. These new listings give buyers a few more choices and are helping to meet huge buyer demand. In addition, there are several new housing developments in both Morgan Hill and Gilroy that are adding to the inventory.
Santa Cruz County – The number of homes on the market in Santa Cruz is approximately 33% down from this time last year, with an increase of homes priced over $1 million. Sales activity is only slightly down from last year, as demand is strong and keeping supply down. Previews Properties in Santa Cruz represent nearly half of the inventory on the market. Even with the inventory being much lower this year compared to last, the number of sales for February this year fell just one unit short compared to February 2015.
Monterey Peninsula – The Carmel real estate market is trending the exact opposite of the U.S. stock market. January and February sales in Carmel have experienced a 20% increase in the average sale price with a 10% decrease in unit sales. There were 2 significant sales off MLS that did not add to this increase. In fact if they had been added to MLS the number would be significantly higher. The Pebble Beach market received much exposure during the AT&T Pebble Beach Pro Am and we are still seeing residual inquiries. The $20 million and above price point is seeing more on the market with a significant sale scheduled to close the end of the month. Spring is in the air and the scenic beauty continues to amaze our out of area visitors.
Market Watch is a bi-weekly column by Coldwell Banker San Francisco Bay Area president Mike James. Click here to view past issues.