Sonoma Housing Bubble

Pulling the cork out of Sonoma's bubbly housing foolishness

Friday, December 15, 2006

Sonoma County Affordability is the Worst

Home prices fell more sharply in Sonoma County last month than anywhere else in the Bay Area, except Solano County, according to a report issued Thursday.

Steve Cochrane, an analyst with Moody's who tracks Sonoma County's economy, said he wasn't surprised by Sonoma County's drop.
"I've always felt the Sonoma County housing market was at fairly considerable risk," he said.
"It seems like Sonoma County is one of the weakest economies in the Bay Area. There's hardly any job growth to speak of. That's essentially the basic building block of the economy," Cochrane said.
YAWN! we've been reporting on the state of the economy for the past 8 months. This should not come as a surprise to anyone. Plus who cares about the reporting on this... if you live here you KNOW this because you live it every day.

A weak economy, combined with home prices that remain out of reach for many residents, continues to dampen buyer demand in the county, Cochrane said.

The county has lost 3,100 jobs over the past year, putting the brakes on what had been a sluggish economic recovery from a recession that was longer and deeper than expected.

Sonoma, Solano and Contra Costa counties, which are the farthest from the core of Bay Area jobs and have the region's least-expensive homes, suffered the largest rate of decline in November, according to Data-Quick Information Systems, a real estate research firm.

In Sonoma County, prices have dropped 7.7 percent to a median of $530,000, while sales have declined 22.5 percent, according to DataQuick.

An expanding labor market is critical to housing's health because that draws workers and can boost incomes.

Another disadvantage for Sonoma County is being on the edge of the Bay Area and far from major job centers. That limits the number of commuters willing to move here and first-time homebuyers drawn to where jobs are forming, Cochrane said.

"Income growth has been sluggish as well, so we haven't really seen enough of an improvement along with lower housing prices," he said. "The affordability of housing in Sonoma County is probably the worst in the Bay Area."

Even if prices level off next year, the county's housing market could remain weak through the middle of 2008, according to the latest forecast by The correction in home prices will be deeper in Sonoma County compared with the Bay Area as a whole, Cochrane predicted.

"It may be until the middle of next year until things settle down," he said.


At 12/15/2006 06:57:00 PM , Blogger sf jack said...

athena - You're back!

"In Sonoma County, prices have dropped 7.7 percent to a median of $530,000, while sales have declined 22.5 percent, according to DataQuick."


Ah, probably more of that to come!

At 12/15/2006 08:27:00 PM , Blogger Athena said...

Great to see you Jack! How have you been?

The day job has me completely buried so I have tried to peek out from under the piles now and then. If the news wasn't earth shatteringly new I passed on just regurgitating the news everyone is seeing now.

Even today Michael Coit was on my nerves as this is not new in the slightest. It is going to get a whole lot worse... and yet we can anticipate the PD being more pollyanna about it than Pollyanna herself.

Anyway... lately I peek in at the headlines over at Ben Jones' place and sometimes get 15 or 20 comments actually read. :-/

Today he was reporting on Sonoma County at the top of the page and I felt like a complete slacker. I also checked the email today and good heavens... thank you to the readers who have been checking in and sending stories and thoughts. You are terrific! I will get to work getting some of your stories posted this weekend.

At 12/16/2006 12:27:00 AM , Anonymous Anonymous said...

I just shot-up the Q3:2006 reports for Orange County, Inland Empire, Ventura, DC & New York

They join prior FREE reports on Bakersfield, Boston, Chicago, Denver, Las Vegas, Los Angeles, Miami, San Diego, San Francisco and Seattle.

At 12/19/2006 06:39:00 AM , Anonymous tom stone said...

love the numbers from dataquick,peak median $619k,current median $530k,and this is reported as a 7.7% betcha,and the market will bounce back after the raiders win the superbowl in golly,if you can't trust a realtor (tm),who CAN you trust?


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