[caption id="attachment_41484" align="alignright" width="350" caption="The Meritage model homes"][/caption]
NORTH BAY -- In the wake of the annual California Realtor Expo in San Jose, many of the North Bay Area’s real estate experts say that growth in the local housing market stands a good chance of outpacing forecasts for the state as a whole, although the levels of price and sales growth remain subdued.
A somewhat rosier outlook for jobs in the North Bay is helping to drive that trend, with many expecting housing markets to climb higher than the state’s 1.1 percent increase in sales volume and 1.7 percent increase in price forecast for next year by Leslie Appleton-Young, chief economist at the California Association of Realtors.
“It would not surprise me to see 2 percent growth (in price) in the North Bay, simply because we have a lot of good economic forces in the Bay Area that tend to leak over the bridge,” said Robert Eyler, director of the Center for Regional Economic Analysis at Sonoma State University. “I would be surprised if we had negative growth.”
Job markets, particularly at a time when banks are looking for reassurance before lending, have a direct relationship with the demand for homes, Mr. Eyler said. Marin, Napa and Sonoma counties each beat the state’s average unemployment of 12.1 percent in August, with Marin joining San Francisco and San Mateo in having the lowest level of unemployment in California--7.8 percent.
[caption id="attachment_41485" align="alignleft" width="350" caption="Construction continues on the 132-lot Ragle Ranch Development in Santa Rosa"][/caption]
Where state and local outlooks agree, though, is in expecting home prices to climb slowly over the next few years, a trend that is a far cry from the meteoric growth of the bubble years.
“Of course, we want it to be better. It (the forecast) did show that we are actually making some headway. At least we aren’t going backwards,” said Mary Kay Yamimoto, president of the Marin Association of Realtors.
“There’s no denying the fact that these are tough times,” said Marin Association of Realtors CEO Edward Segal, who also attended the conference and emphasized the additional market uncertainty stemming from potential economic policy changes in Washington and California.
Within the North Bay, forecasts differ between counties and at different levels of the housing market.
Many consider Marin to be the next “layer of the onion” to the economic epicenter of San Francisco, benefiting more directly from the area’s activity than the more distant Sonoma and Napa counties, Mr. Eyler said.
Ms. Yamimoto said that Marin was the only North Bay county to see a median price growth last year- up 1.6 percent. It was a positive sign, but the indicator was less useful without a high enough sales volume.
In Sonoma County, the operators of the new Ragle Ranch development said they were “guardedly optimistic” about the demand for their new, energy-efficient homes.
“We started slowly, but we’re really starting to build some momentum,” said Barry Grant, president of Meritage Homes in California.
With homes ranging from $370,000 to above $430,000, Meritage has sold 12 of an planned 132 homes, Mr. Grant said.
It’s a price range where Rick Laws, long-time researcher of real estate data in Sonoma County, has documented a good amount of activity.
“There’s a bifurcated market — one north of $400,000 and one south of $400,000,” said Mr. Laws, who manages the Coldwell Banker real estate office n Santa Rosa. “If that trend of first -time homebuyers and investors continues," in the under $400,000 market, "I expect we’re going to grow beyond the CAR projections.”