As I was posting this week’s “Yountville weekly real estate update“, the fact there were 32 active listings is very significant. This is the highest number of listings I have ever seen in 25 years of selling real estate here and since the previous week, the first time this number was ever in the 30+ range. In the past, this number would be normally be around 20. But since this real estate slow-down started in earnest here about 10 months, this number has been constantly creeping higher and higher. Interesting what the number for the most listings will finally be. On a good note, it is now one less for we did have one sale pending this week so far.

If you read the first part of this post, “Napa Valley Real Estate, a Tale of Two Times Two Markets“, you can probably figure out where this continuation is heading. Yes, there are two distinct markets for Napa Valley real estate. Much as it is in other parts of Califonia and the country, lower priced, reasonable valued homes are getting multiple offers, some as many as 20. Now you may get turned off by the fact this is for homes priced under $400,000 here in the Napa Valley, but that is just the fact nof life living here. The upper end is a different creature, nothing is moving and the months of inventories on the market are soaring.

To prove the point, one only need to look at the graphs below from Treadgraphix. I choose the City of Napa and American Canyon for they represent about 95% of all distressed sales. For the upper end, I looked at Yountville, St. Helena and Calistoga. It was no surprise but the months of inventory have come down steadily from January to June 2009  for Napa (8.3 to 5.5) and American Canyon (6.2 to 1.5) and varied in the extremely high range for Yountville (13 to 20+), St. Helena (15 to 74), Calistoga (9.5 to 58+) for the same time period. For Napa County as a whole, months of  inventory has also decreased steadily from 9.5 to 6.1 mainly due to the huge percentage of all sales being in Napa and American Canyon. Remember, 5-6 months of supply is considered to be a balanced market between buyers and sellers and much less or more skews the market in favor of one or the other. And yes, being there are so few sales for the higher priced homes which is 90%+ of the market place in the up Valley areas, it may take a very long time to sale your home in this market especially if it is over-priced. In faact that could be 2-3 years if things don’t change.

Just look at the graphs below and you will see how they prove the above. The graphs are all the properties listed in my MLS, BAREIS (which represents approximately 95% of all sales here) which are For Sale, Pending (have an accepted offer) and Sold in each of these cities/town (Yountville is a Town) and for the Napa Valley. YES THERE ARE DEFINITELY TWO MARKETS HERE and the moral of this story, you better price your home correctly in this market.

Napa County For Sale, Pending & Sold

American Canyon For Sale, Pending & Sold

Napa For Sale, Pending & Sold

Yountville For Sale, Pending & Sold

St. Helena For Sale, Pending & Sold

Calistoga For Sale, Pending & Sold

Especially during these turbulent times, by far the first questions I get asked by any first time buyer or anyone looking to purchase a home for under $500,000: Is it a foreclosure and what type of deal can I get? I then have to explain how things work and how almost every foreclosure and/or short sale, if priced correctly and in reasonable condition, is getting multiple offers and generally selling over the asking price. Even my more sophisticated, upper end buyers want to know if a property is a distressed sale, which is what we in the business refer to for any foreclosure, short sale and REO. I then have to explain how  the Napa Valley is truly two different markets and almost all such properties are in the cities of American Canyon and Napa and there are virtually none up valley.

Being this was the case 4 months ago, I decided to reconfirm this statement and thought my readers would find the facts supporting this interesting. Since approximately 90% of all real estate sales are reported in my multiple listing service, BAREIS, I have used them as my sole data source. What I am calling up valley are the cities/towns of Yountville, Oakville, Rutherford, St. Helena, Calistoga, Deer Park and Angwin. For the cities of American Canyon and Napa I have looked at all properties and those $400,000 and less which is were virtually all the distressed sales action is . For up valley, I used $500,000 since there are so few properties for sale at the lower figure.

                                                                       Amer Cyn  Napa  Up Valley  % distressed

All for sale, pending, sold 2 months   207          706         274

              Distressed Sales                             154           275         19           74%  39% 7%

All to $400,000                                          159          284

               Distressed to $400,000            135          211                           85%  74%

All to $500,000                                                                             31

               Distressed to $500,000                                               12                                39%

Thus, based on the numbers my statement is only partially correct and I now have to qualify it for even up valley, lower end properties are being affected by this market. Granted the number of $500,000 up valley homes  is very small when compared to the number in American Canyon and Napa to $400,000, 31 vs 380, but the percentage, 39%, compared to 14% only four months ago is a definite increase.  Thus the meaning of my title “Two Times Two”; by far the vast number of distressed sales are still in American Canyon and Napa, but the percentage of lower priced homeowners feeling the pinch are everywhere.

One new area of concern is for homes priced $800,000 to $2,000,000, especially up valley. In all sales meetings and discussions I am involved in concerning distressed properties, this price range is mentioned most often as the new crack in the dam. Even the news headlines are beginning to point to homes priced in this range as the “new wave of foreclosures which will be going to sale over the next few months.”. Thus I am beginning to track  this for up valley properties. Today, there are only 2 distressed sales of 110 in this price range. Tune back in for I think I will begin adding this as a new monthly blog article. It will be interesting to see if does really happen here in the Napa Valley.

photo from www.napavalleylodging.biz for Napa Co. vacation rentals

Napa County is preparing to crack down on “illegal” or non-conforming vacation rentals in unincorporated area of Napa Valley by preparing a new ordinance.

A report prepared for yesterday’s study session of the Napa County Planning Commission by Planning Director Hillary Gitelman asked for discussion and direction on the development of an ordinance “clarifing the difference between single family dwelling units and short-term commercial guest accommodations, specifying uses and ownership or rental arrangements associated with each and analyzing extremely large residences to determine if they should require environmental review.”

This action falls in line with the implementation of the new Napa County General Plan.

“In the unincorporated County, there are about 10,090 dwelling units, with the median household income of $99,200. Very little new housing development occurs in unincorporated Napa County due to land costs, minimum parcel sizes of 40 to 160 acres in most of the County and the small supply of land available for multi-family housing,” said Gitelman in her report.

“At the same time, Napa County’s agricultural economy is supported by tourism, and some residents and business entities have discovered they can reap substantial profits by renting their homes, second units and/or guest cottages to tourists or by selling memberships or using other creative ownership/rental arrangements. It is difficult to estimate precisely how many dwellings in unincorporated Napa County are being used in a manner inconsistent with the County’s definition of a dwelling unit…. Many people have the impression that this has become a serious problem, and both a policy and an action item to address this issue were included in the General Plan adopted June 3, 2008,” she continued.

The County’s General Plan states, “The County will promote development concepts that create flexibility, economy and a variety in housing without resulting in significant environmental impacts and without allowing residences to become timeshares, resorts, hotels or similar tourist-type accommodations.”

Gitelman asked the Planning Commission for specific direction on whether the new ordinance should define what a residential dwelling unit looks like, potentially modifying the definition of “kitchen” contained in Napa County Code and addressing residences in which bedrooms are designed as stand-alone structures.

The Town of Yountville addressed a similar problem in February when it sent letters to the owners of seven Yountville residences advising them to stop using their homes as short-term rental units.

In Yountville it is illegal to rent private homes for 30 days or less.

Yountville’s crackdown was precipitated by public complaints and recognition of Yountville homes being advertised as vacation rentals on popular websites.

“Preventing the intrusion of short-term rental businesses into residential areas preserves the residential character of our neighborhoods and ensures that hotel uses are conducted within the commercial areas of Town designated visitor accommodation,” explained a Town of Yountville assistant planner when the enforcement letters were issued.

The above story is by Sharon Stensaas, Editor of the Yountville Sun, September 18, 2008

This has always been a problem in the Napa Valley. As far as I understand, only the Town of Yountville and St. Helena have ordinances on their code books prohibiting rentals for less than 30 days and each has taken action against illegal vacation rentals. St. Helena did so about three years ago and the only steps the County has taken that I know about was to contact  three owners who were very blatant in how they operated their rental operations and the County received numerous complaints from neighbors. To the best of my knowledge, Napa County doesn’t have a written prohibition against vacation rentals and this new ordinance will be a first.

All that one needs to do to see how many vacation rentals are out there is simply do a Google search on the term. Many, including several in Yountville, have changed the wording on the various websites they advertise on to “only rented by the month” but upon calling the owner, find it is miraculously available for a shorter time-frame.

I am not certain of exactly how I feel about vacation rentals here in the Napa Valley. I only know it was sure nice to have them available when I went somewhere on vacation, but then, would I want one next door to me? That seems to always be the question I come back to. Let me know how you feel.

This is a weekly feature to keep you informed about the real estate happenings in Yountville. Besides just real estate info, I hope to give the readers of my blog some insight into the heart of Yountville using a variety of media including photos, tidbits, gossip and other fun things. If this is of interest to you, I would love hearing from you. If there are other cities here in the Napa Valley, such as St. Helena or Calistoga, you would like this feature expanded to, let me know. 

STATS

last 7 days acivity     new listings  1    sale pending  0    sold  2    expired  0    withdrawn  0

new listing(s)          1510 Yountville Cross Road, $3,400,000, 4 br, 4 ba, 3,417 SF 1.35 acre

new sold(s)               35 Forrester Lane, $515,150, 2 br, 2 ba, 1,069 SF

                                5 Redwood Drive, $950,000, 4 br, 3 ba, 1,880 SF

          Facts, numbers, SF from BAREIS and/or Napa County tax records, not guaranteed

current active listings for sale    23      average price  $1,291,557   average days on market  108

current sale pendings                1       average price  $550,000   average days on market 340

sold in last 6 months                 12       average price  $644,179   average days on market 138

FACTS ETC

This week in FACTS ETS, I have decided to tell a bit of the history of Yountville: About the Town of Yountville from the Yountville Chamber of Commerce website:

In 1831, George Calvert Yount saw the Napa Valley and declared, “In such a place I should love to clear the land and make my home. In such a place I should love to live and die.”

As the first non-native settler in the Valley, Yount enlisted local Wappo Native Americans to help him build a Kentucky blockhouse and a mill. In 1855, he commissioned a surveyor to lay out the city. The new community was christened Sebastopol, even though there was a town with the same name in nearby Sonoma County. George Yount planted the first grape vine cutting into the fertile soil of the Valley. In 1867, two years after Yount’s death, the town was renamed Yountville in honor of its founder.

Gottleib Groezinger established a massive brick winery, wine cellar and distillery in 1870, and the community was soon planted with grapes. In 1884, the Grand Army of the Republic established the Veteran’s Home to honor and care for those injured in service to their country. The Home was given to the State of California in 1897. Gradually Yountville became a quiet residential town. In 1965, it was incorporated as an official California city, and shortly thereafter, the old Groezinger property was revitalized as Vintage 1870, a complex of shops, galleries and restaurants which turned Yountville into a charming visitor attraction.

Through the years until the present day, Yountville has retained its rural charm and residential character while encouraging the commercial centers to retain the charm and taste that has become synonymous with Yountville. Today’s visitor will find a variety of gourmet restaurants, charming lodgings, exquisite retail shops, antiques and art galleries, and world-class wine tasting opportunities. Sunrise hot air balloon rides, an afternoon of golf, a historical walking tour, a set of tennis or a bicycle ride down a quaint vineyard lane are just a sampling of what Yountville has to offer.

In Yountville, the seasons come to life with festivals, celebrations and events! In March Yountville celebrates the Napa Valley Mustard Festival with “A Taste of Yountville!” This all-Yountville showcase features traditional samplings of gourmet restaurant fare, olive oil, vinegar and mustard as well as fine wine and micro-brew tastings. A cornucopia of lifestyle demonstrations by retailers and innkeepers, including fashion shows, tours, furniture restoration demonstrations and celebrity chef mini-workshops awaits visitors.

Christmas past comes to sparkling life the day after Thanksgiving with the kick-off of Yountville’s “Festival of Lights,” heralding a joyous month-long celebration of holiday events and entertainment through New Year’s Eve. Strolling musicians, jugglers, face painters and artists join Yountville’s restaurants and wineries along Washington Street. Vendors offer sumptuous samplings, holiday treats and the wine that makes the Napa Valley famous. That evening join Santa as the entire town is set aglow with thousands of sparkling white lights.

A holiday in the Napa Valley isn’t complete without a stopover in Yountville, the unique wine country community with a heart.

For more information on Yountville or for events info, call 707.944.0904 or click here.