T
he North Bay real estate market is poised for improvement in 2025, with both increased inventory and closed sales expected. According to BAREIS MLS data, Sonoma County buyers entered into purchase agreements for 200 single-family homes last month, a 13% increase over the same period last year.

    In December, property owners listed only 111 new homes on the market, a 28% decrease from the previous year's numbers and a new historical low. However, buyers completed purchases on 248 homes, an 8% increase over the 229 units that transferred ownership in December 2023. This has left around 550 homes available for sale in Sonoma County, a 28% bounce above the 30-year low seen in December 2023.

    As the new year begins, buyers are likely to reignite their searches and new prospective buyers will start looking, leading to an increase in the absorption rate. A high absorption rate indicates that the supply of available homes will shrink, making it more likely for owners to sell their properties quickly. With a current absorption rate of 45% in Sonoma County, prices are likely to experience an uptick unless a robust amount of new inventory comes on the market.

    In Marin County, property owners listed only 27 new single-family offerings in December, another all-time monthly low and 29% less than last year. This will continue to create a competitive environment for buyers in Marin County, with an absorption rate of 92% indicating that buyers will face greater competition with each new home they come across.

    Napa County has been a balanced market until now, but December brought 33 new offerings to the marketplace, leaving 236 homes available for buyers. Buyers placed 54 new deals into escrow, while sellers completed 80 transactions in December, resulting in an absorption rate of 34%. Looking ahead, we can expect 10% more sales volume by the end of the year and potential price escalations of 2-5%, depending on the market.