The "Green Rush" and Humboldt County, CA Real Estate

The “Green Rush” is on!  People from all over California and  all over the nation are rushing to Humboldt County to buy up “grow properties,” land suitable for the growing of marijuana.  Has it affected the real estate market in Humboldt County?  I teased out some simple statistics to get a broad overview of this issue.

To get a baseline of the real estate market without the influence of “grow properties, “ I pulled up all of the single family homes sold in Humboldt County on city lots over the last 4 years.  These homes, by and large, shouldn’t be affected by the marijuana industry.  What I saw was a 17.6% increase in the average price of a home over a four year period, 2013 through 2016, with the number of units sold between 492 in 2014 and 520 in 2016.  That’s an average annual increase of approximately 4.4%, roughly on par with national trends.

Next I pulled all properties that have sold over the same 4 year period with at least 20 acres, including both homesteads and raw land.  While not all of these properties will be used to grow marijuana, most “grow properties” will fit into this sample.  These properties experienced an increased average sales price of 92% over the same four years, and a 69.6% increase over last year alone!

There’s no question that the “Green Rush” has had a huge impact in the Humboldt County real estate market, but it does seem that, for now, the effect is mostly limited to large agricultural parcels suitable for growing, and not general single family residential homes.

Real Estate Market Stats - Humboldt County, CA , February 2013

The statistics for Humboldt County's real estate market are very, very remarkable. I've had to tweak the parameters of my graph axis to keep the data on the chart!

The inventory of active homes in Humboldt County has literally fallen off the charts! I've never seen less than 500 homes on the market until last December, and now we are under 400! There is a real shortage of homes on the market right now!

But demand is up! We sold more homes in January than any of the past 5 years, and more than the average of the 6 years before that! Folks are buying homes!

With supply low and demand high, we should see rising prices. Well, not quite yet, but they are certainly not falling. We spent most of last year between $240K and $260K. We start this year right at $240K, a $17K improvement over last year!

Similarly, the median home price is up over last January, and right in line with our market performance last year.
 
The bottom line is that Humboldt County's real estate market is poised for some nice price gains. If you're thinking about buying, this might be your last chance to buy "at the bottom." If you need to sell, there is limited competition, so call me and let's jump in!

Humboldt County Real Estate Statistics for November 2012

I'm bragging!  I called the bottom of the market as January 2012 as early as last February! And sure enough, we seem to have hit it and bounced up a little bit! So, where are we going from here?

The good news is that inventory is really, really low! I don't think I've ever seen inventory this low! This usually means buyers fighting over the best listings with multiple offers, maybe even higher than asking price!

The big question is this: Will demand for homes continue? They certainly did through November; we'll see how the Presidential election results and the Christmas shopping season effect the economy, though. Bottom line: if the economy produces jobs, demand will continue; if not, we could be headed for another decline in the number and price of home sales.

When I say that we've bounced off of the bottom, it's not by a ton. The bottom seems to be around $225,000 average home sales price throughout Humboldt County, with the "normal" in the $250,000 range. Low inventory and high demand will certainly push that up; but if the economy falters, we could see prices start to go down...again.

So if you're thinking about selling a home, now is a great time to do it. Call me quickly so we can get your home on the market before the inventory picks back up. If you're secure in your job, low interest rates and prices make now a great time to buy as well. Give me a call at (707) 499-7111 so we can talk about your specific situation.

Was January '12 the Humboldt Co. Real Estate Bottom?

Everyone is wondering when we're going to hit bottom in the real estate market.  I predicted this past February that January 2012 was going to be it!  Why?

The number of active homes on the market has been at normal or below normal levels since December of 2011.

And demand in the form of the number of homes sold has been very solid since August of 2011!  When supply is down and demand is up, it can't help but to support prices!

Humboldt County's average selling pricing had been bouncing around $250K for the last half of 2011, and when it hit a low of $225K in January '12, I thought, "this might be it!"  February's active listing numbers came in low, and the number of sold units remaind strong, and sure enough, our average price bounced right back up to the $250K mark.

The median sales price had been tracking in the same direction as the average price.  All this convinced me that our likely bottom would be January 2012.  So far the fundamentals continue to show support for prices. 

Low inventory is beginning to hold us back a bit on volume, which will continue to support prices.  So if we can get loan underwriting standards back into a "normal" mode, we should see some home prices rising back to levels where they were purchased in the last several years!  This will enable more homeowners who need to sell to do so, increasing our inventory.  We should then see prices start to stabilize, hopefully sometime next year!

So, should you buy?  Is now the time to sell?  Call me at (707) 499-7111, and we can make a plan to accomplish your real estate goals!

Great Humboldt County 3rd District Supervisorial Forum!

Mark Lovelace

Humboldt Association of Realtors had a great candidate forum tonight between two great people, incumbent Mark Lovelace and challenger Karen Brooks, who are both running for Humboldt County’s 3^rd County Supervisor seat!  Both candidates did a great job of fielding some tough questions and communicating many similarities, but also some key differences in how they would respond to upcoming issues in the County.

• Karen Brooks said that she would like to take the county housing element “back to the drawing board.”
• Mark Lovelace noted that “infill only works if that’s what the people want.”
• Brooks, when asked about the issue of  “shaded parcels,” said that the shading that the county did was “unethical and illegal.”
• Lovelace is working to allow landowners to file “non-industrial timber management plans” at less expense to enhance their ability to manage resource lands.
• Brooks is open to the idea of outsourcing many of the planning department’s permitting processes to local agencies.
• Lovelace believes that a key government role in the planning process is to “balance the property rights of an owner with the property rights of his neighbors.”

Karen Brooks

I am thankful that both candidates came out on a rainy night to give us their thoughtful, sometimes provocative answers to some tough county problems.  It was an entertaining and informative forum!  Thank you, Mark & Karen, for your thoughtful responses and willingness to serve!

Tacky Neighbors Can Cost You Money!

The three biggest factors in real estate values are 1) location, 2) location, and 3) location.  So the old saw goes, but this photo proves that the quality of neighbors has to fit in there somewhere.  I drive by this pick-up truck on my way home from our local grocery store, and cringe every time.  And when my children are with me, I often think about pointing out some feature in the clouds on the left side of the street.  Fortunately, our home is another half mile or so away, so this pickup doesn’t affect us directly.

I got a call recently from a friend who owns the property just across the intersection from this pickup.  They live out of the area and have been renting their home to tenants for several years now, and are thinking about selling.  We talked about a lot of the neat features they built into their home, and the extra large lot, and the huge amount of privacy, especially considering the location in the middle of town.  But she had no idea what was on the tail gate of her neighbor’s truck!  She was mortified!

When the home hits the market, I will be sure to give directions for other agents to approach from the opposite direction; at least the offending neighbor has the consistency to park on the same side of the street, all the time. But eventually some potential buyers will drive by and see the tail gate, and will instantly be turned off on the neighborhood, and consequently the home. 

How much of a price hit will we take on this otherwise delightful cottage?  Fewer interested buyers means fewer offers, which means more downward pressure on the price.  Is it a $5,000 hit?  $10,000?  $25,000?  It might even be worth it to “buy out” the tenant’s lease and make it worthwhile for him to move into someone else’s neighborhood.  Maybe yours?  Maybe mine.

Why I Love Humboldt County, California!

I Love Humboldt County, California!

A picture is worth a thousand words!

But just in case you missed some of them, let me repeat.  The mountains trail down right to the ocean, so we Eurekans can walk on the beach, often in the warm sun, and see snow in the mountain peaks inland a few miles.  I love the way big waves crash against our rocky coast and spray foam everywhere.  I love to walk the docks and quiz my wife about the different types of rigs on the sailboats.  I love buying fresh crab or fresh tuna off the fishing boats in the marina.  70% of the oysters grown in California are grown in Humboldt Bay! 

And the Victorian seaport of Eureka is a fabulous place to wander and look.  The architecture is epic!  The Carson Mansion is widely considered to be the most prominent example of Queen Anne Victorian architecture, and there are so many gorgeous examples of Victorian architecture in the Old Town area!  There are tons of cute little stores for shopping.  Great food in a wide variety of restaurants.  And lots of interesting people!  I truly love Eureka!