Nevada County Market Metrics-2012 Inventory Update
In December 2011, we took a look at monthly inventory of single family residences (SFR) over the previous 3 years and discussed the effect of declining local inventory on demand and pricing. Here is the data from that article:
| Month/Year | Total Residential | Total Single Family |
| 10/09 | 833 | 745 |
| 10/10 | 878 | 801 |
| 10/11 | 688 | 618 |
Let’s take a look now at the data for 2012 and the continuing trend:
| Month/Year | Total Residential | Total Single Family |
| 12/11 | 588 | 532 |
| 01/12 | 568 | 513 |
| 02/12 | 549 | 500 |
| 03/12 | 532 | 487 |
| 04/12 | 550 | 505 |
| 05/12 | 586 | 540 |
After significant continuing decreases in the first quarter, there has been a modest rebound in SFR inventory, yet it is still 13% below the level in October 2011.
From December 2011 to May 2012, median sale price of SFR has risen from $222,500 to $229,000, and increase of 3%, for an annualized gain of over 7% if the trend holds. In the same period, monthly units sold have risen from 74 to 119, an increase of 60%.
Typically, seasonality will cause these trends to taper off in the second half, and continuing unpredictability in global economic factors may also play a part.
While some areas of California and many in the US have excess inventory, here in Nevada County, we continue to face a situation where we have buyers who have been in the market for many months and have not been able to acquire the property they desire. In our local market, well over 80% of the sales are under $350K, and this is where we are really feeling the inventory crunch.
Multiple offers, overbids, rising median sale prices and units sold. These are all strong trends indicative of a significant under-supply of suitable properties in the current market.
For property owners who are in a position of equity and have been waiting for a time when they can market and sell their homes without having to chase a falling market, this is a good time. The combination of low interest rates and steadily rising prices is putting the fire under ready buyers. Well-priced properties are selling in a matter of days or weeks, sometimes above list price.
Locally, we are blessed by a uniquely high quality of life and an increasingly global exposure as a destination-type market. Not to mention as a refuge from an increasingly stressful and dangerous urban environment as our nation faces a crisis of unprecedented significance. Our little island of relative peace and serenity is a magnet and a haven for people with the wherewithal to pull it off. This is especially true at this time for younger people, families with children, and those who wish to actively engage in a strong local economy where we are able to take care of many of our own needs without leaving the area.
Paul Sieving is a Realtor® with MacLeod Sierra Realty, a former Director and MLS Chair of NCAOR, was Board Chair of the Grass Valley Chamber of Commerce in 2004, and has served our community as a real estate professional for 14 years. Comments, questions and thoughts are welcome at Paul@PaulSieving.com or (530) 274-0906.