GREEN REALTOR NEWS | Vol. 34
Market Update - Year in Review | Accessory Dwelling Units and SB9 | Photo Contest
2023 Year in Review
In 2023, the market grappled with significant challenges, including elevated interest rates, uncertainties in the financial markets, unfavorable media portrayals, and a noticeable scarcity of property listings in the majority of neighborhoods, resulting in a marked decrease in sales volume. Despite these obstacles, December data reveals a positive shift, with the median sales price for both single-family homes and condominiums surpassing the figures from the same period in the previous year. One key factor contributing to this positive trend is the significant decline in interest rates, dropping more than a full percent since their peak in October. Currently hovering in the mid-six range, these lower rates are expected to motivate potential sellers, particularly those previously discouraged by the mortgage lock-in effect. The prospect of the Federal Reserve lowering its benchmark rate in response to falling inflation adds to this optimistic outlook. Media coverage is also exhibiting a positive trend, indicating a shift towards a more favorable market sentiment. Looking ahead, these positive shifts paint a brighter picture for the real estate landscape in the coming year.
It’s interesting to take a look at year over year trends in different communities. The graphic above on the left shows the number of homes sold, days on market, and sale prices broken down by different communities in Marin. While county-wide property values were down by 7% from the previous year, we see in popular communities like Mill Valley where demand exceeds supply, the decrease was only 1% in value despite the highest mortgage rates in over 20 years. In San Francisco, while the city-wide average sale price for single family homes was 6.9% over the list price, hot neighborhoods like Hayes Valley and NOPA were averaging 12 - 15% over asking.
Click the buttons below for the full market reports
Accessory Dwelling Units and California Senate Bill 9
One of the top things on my list of 24 Things I’d Like to Accomplish in 2024 is purchasing another investment property. I’ve been busily concocting spreadsheets, surveying rental prices, and searching for just the right combination of condition, location, and income potential. I want something that has immediate income plus the possibility of adding additional units, either through building an accessory dwelling unit or subdividing a home into a duplex, or both. Due to the passage of Senate Bill 9, The California Housing and Opportunity and More Efficiency (HOME) Act in August, 2021, subdividing existing properties and adding units became easier to accomplish. The goal of SB9 is to develop solutions to the state housing crisis and create positive change toward equity, inclusivity and affordability for our communities.
The law went into effect on January 1, 2022 and all California cities must comply with allowing increased density. Despite this, local governments are allowed to impose objective design standards and limitations as long as they don’t directly conflict with state law. Local governments and private companies are developing resources to help homeowners or interested buyers assess the possibility of additional units. For example, Homestead is a design/build company that developed a scorecard for over 78 communities in California to determine the city’s openness to SB9. San Francisco is one of just 4 communities to get a A “Very Friendly” rating. San Rafael is close behind with an A-, also “Very Friendly.” Click the buttons below to see Homestead’s SB9 City Guides for San Francisco and San Rafael.
Accessory Dwelling Units are increasing in popularity. New laws passed in 2021 also impacted ADUs. Click here to view the California Department of Housing and Community Development’s handbook from July 2022 that details the changes to the ADU laws and the impact of SB9. For those living in unincorporated areas of Marin County free feasibility and project management support is provided through a partnership with Hello ADU. ADUMarin is another resource for those living in cities and towns in Marin. San Francisco residents can check out the SF Planning Department webpage for more resources.
Are you building an ADU or adding units at your property? I’d love to hear from you. The resources make it look easy, but I’d love to hear real world experiences of how it works in practice. I’ll keep you all updated on my investment property search and let you know how it goes!
And now…our January Photo Contest!
All of the beautiful photos in our contest are provided by Green Realtor News’ Artist-in-Residence, Esther Vermeer. Esther is a Mill Valley resident with a background in branding and graphic design. Originally from the Netherlands, she moved with her family to Montreal, Canada for a while and came to the Bay Area 14 years ago, where she has since established herself in the world of interior design. She loves to journey around California and discover the lush natural beauty the state has to offer. You can reach her at esther@prevalentprojects.com.
If you know the location email me at lucinda@lucindaotto.com. The first person with a correct guess wins a $25 gift card to Sports Basement.
I hope you enjoyed the Green Realtor News! If you know anyone buying or selling, or if you are curious to hear more about the market, please don’t hesitate to reach out. I’d love to help you or your friends make moves. As one of my happy clients loves to say:
Everyone Needs A Lucinda!
