Tiburon CA Real Estate Update

December 15, 2011

Filed under: Tiburon — dwdupont @ 11:00 am

Chart Guide: The below charts include a great deal of data. Besides the two charts immediately below title Marin Real Estate Pullbacks & Southern MarinPrice Index, all charts show annual data, business cycle average and trailing 12 month stats. The business cycle average can be considered a  “Intrinsic Value” estimate. The years where the county or town was trading above the business cycle average relates to market conditions dominated by optimism/exuberance and the years where it trades under this business cycle average is more dominated by fear/pessimism/uncertainty & restraint. The trailing 12 year data will eventually meet with 2011 but it is a barometer of which direction the market is heading. If the trailing 12 month number is higher than the 2011 number, it means market conditions were generally better at the end of 2010 then they are today.

Marin Real Estate Pullbacks– shows the severity of the recent real estate downturn, in case anyone had any doubts. There have only been two years since county-wide average data started being compiled where Marin County-wide Real Estate prices decline year on year– after the S&L crisis in 91-92 where Marin County prices decreased a little over 1% each year. Against this back drop of generally stable upward sloping prices the Great Recession obliterated this trend with great volatility:

Mile High: Southern Marin County Price Index is a town-weighted-average by unit sales. Tiburon & Belvedere RESI prices (condo & SFR) are having very difficult years (both off -20%) as the high end of the market is still very slow and is dragging this SOMA index to the lowest point in the trailing business cycle (about 7 years).

The below 2 charts show Tiburon CA homes prices. the first is median price and the second is TDG Price index which is a mixture of average prices, median prices and is a function of the size of the house. Tiburon average SFR prices are off 18% and median prices are off about 10%. This is the worst year on record for Tiburon.

The TDG index is down 11% which is a closer to telling the full story than the 18% SFR average price drop and the 19.7% RESI (condo & SFR) drop. The drop is due to the lack of high end sales. There have only been 2 homes that have traded so far in 2011 above $4m. The average since 2007 is 9 homes above $4m. This trend will very likely reverse itself in 2012.

Interestingly– lot values have actually increased in 2011. The second chart below shows that the amount people are paying for the actual structure of the house has decreased about 4%. The takeaway from both charts is combined with the statistical price drop data above is that people are buying smaller homes in the bottom 2 quartiles of the market and planning to remodel.

The most misunderstood market statistic is the below chart selling: $/sqft. Buyers should never try to compare homes by this barometer especially in locations where architecture and lot/locations vary greatly as they do in Marin County. The greatest repository of home value is lot/location which is not explained well at all by selling $/sqft. It is a very good addition to market wide research however– and by this metric Tiburon CA Real Estate is only down 3% in 2011.

Earning Your Business

The purpose of this Southern Marin Real Estate Blog is to offer greater insight into our local real estate markets than you can find anywhere else– to help you make better decisions for yourselves and your family. The research found in these pages is my competitive advantage in this market. I have yet to find a rational buyer who doesn’t respond to this data; remember most buyers emotionally want to buy a house– they just don’t understand the value proposition. You deserve a agent to represent you on either side of the transaction that has done  their homework.  If you are thinking about listing or buying a home all I ask is that you include me in your interviewing process.

Thank you & Happy Holidays!

Dave DuPont MBA, CFP


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