Developers are building new homes in the Hollister area, but not enough to meet a continually strong demand, according to a local real estate broker.
That sentiment from Marilyn Ferreira is reflected in recent data showing significant year-over-year gains in county housing prices. Figures released from MLS Listings showed an 18.6 percent increase in the median price – $400,000 in the most recent data tracking home prices between February and April – of single-family homes in the county over the prior year. In Hollister, there was a 17.5 percent increase in the same period.
As a whole, the Hollister area is continuing to show signs of recovery. Hollister-area agents interviewed by the Free Lance talked about buyers with pent-up demand fueled by low interest rates in a slowly recovering economy, though younger generations are continuing to remain priced out of the market.
For those in the market, the main theme developing in 2014 is a lack of inventory, which keeps prices on the upswing despite the number of bidders leveling off in the early part of the year.
The MLS numbers showed an increase in the county’s median value from $330,000 to $400,000 for the three-month period between 2013 and 2014. For just April year over year, median prices jumped from $396,000 to $485,000, a 22 percent gain.
The report also pointed out an increase in the median value from $235,000 in the same period of 2009 to the current $400,000 figure – representing a 41.3 percent increase over those five years.
Builders are responding in trying to meet demand, but not fast enough, said Ferreira and others. In 2013, Hollister’s building department issued permits for 34 single-family homes. So far in 2014 through May 30, the city department had issued 26 building permits. That means residents can expect to see even more building activity in 2014 than they saw in 2013.
As for the home sales market at the start of this week, there were 180 Hollister houses listed on Zillow.com, a popular national search site for homebuyers. That compared with 204 homes listed in neighboring Gilroy, according to the data.
“There’s a pent-up demand, and buyers get frustrated,” Ferreira said. “Interest rates are very low. It’s a great time to get into the market. We’re more fortunate here with the price point a little lower.”
Hollister’s situation is playing out for the most part throughout California, with a healthy building market and continually solid demand from buyers. San Benito County – at one point in 2008, the community ranked No. 2 statewide in per-capita foreclosures – has been more on the volatile side in its collapse and recovery.
Agents such as Ferreira noted that cash investors are still in the market, though not as fervently as in prior years, and that younger Millennials aren’t generally buying homes yet.
With fewer young residents having the ability to buy, or choosing not to, the local market is making up for it with a strong demand for more luxurious properties.
“We’re selling million-dollar homes again, which is good,” Ferreira said.
On the opposite end, while lower-end homes aren’t selling as much, the foreclosure market has all but disappeared.
“That market has pretty much dried up at this point,” said Julie Bonnet, president of the San Benito County Realtors Association and an agent at Bertao Real State Group. “There are almost no short sells. Government programs helped a lot of homeowners.”
Although the single-family housing market has picked up, the rental market has remained strong as well, Bonnet said. The number of bidders for each home, meanwhile, has simmered some as well, she said.
The county has had low inventory for about two years, with a slight inventory uptick in 2014, she said. She said agents were seeing more than a dozen offers when the market heated up a couple years back.
“Last year, that started to be like five or six offers,” she said. “This year, we’re still looking at maybe one or two, and our houses are staying on the market a little longer.”
NUMBERS FOCUS:
• Aromas values have experienced the biggest local jump since 2009, a 43.4% hike from $245,000 to $685,000 in the 3-month period, though there are relatively few sales there.
• The “average days on the market” figure in Hollister has gone from 92 in 2009 to 24 in 2013 and now 59 in 2014.
• North San Benito County values have gone from $373,500 in 2009 to $600,000 in 2013 and $827,450 in 2014. Over the 5 years, it represents a 54.9% gain.
