Every Monday morning, the Sotheby’s Wine Country office holds a meeting, to express community announcements, buyer and seller needs, feedback, corporate news etc. It allows most of the Sotheby’s agents to gather around some pastries and coffee, to share ideas on projects, new contracts and help the office move forward. On Monday 26th of February, the subject of the meeting evolved around two things. Starting with the housing crisis that is affecting the valley and then the intervention of an Agent from the Beverly Hills office, specialized in Senior citizens.
Housing Crisis in Sonoma county.
For the past couple of years, a housing crisis has been affecting the valley’s available housing, due to sprawling vacation rentals like Airbnb, increasing flow of tourists, and an increasing number of secondary homes bought by people living in the city (San Francisco).
In October 2017, in the middle of the night, a fire raged throughout different cities making it the most devastating in the State’s history, burning more than 5200 homes in Sonoma County. Adding to the housing shortage, the burned down properties will have to be rebuild, along with development housing for labor coming in.
Existing crisis + fire victims + labor = 25.000 – 30.000 houses needed
Urgency, several problems arise.
· Fire victims are still staying in vacation rentals which were transformed into short lease in order to put a roof over their heads, but with the tourism picking up slowly and the high demand for weekenders, the fire victims will more likely be pushed. Thus the problem of housing all those people also arise.
· The rebuilding process will be a long and difficult one, creating a labor and a resource shortage, making house projects (fixers uppers) less attractive for buyers that will focus more on ready to move in.
· House project can involve remodeling like installing new windows, moving walls, doing the electrical and plumbing etc. The crisis will be "decade long process".
· Because of the fires, the county of Sonoma will have trouble raising property tax due to the fact that the houses burned. Around 10 million $ are expected to not be raised.
"The county needs more than 8000 homes to provide for the projected growth and another 12000 to avoid over crowding.”
Intervention of Alison Whitaker MacCraken from Sotheby's Beverly Hills office
First specialized in commercial Real Estate around Asia, Alison went on to specialize in Senior Real Estate (SRES), and created a non-profit organization serving the interest of senior citizens. Interesting for the statistics, baby-boomers are causing a Silver Tsunami, seeing waves of the latter retiring, needing assistance, and more specifically needing downgrading. She sees in Beverly Hills that it is too hard for them to downgrade because of high prices of the local market. Therefore the 65+ are sitting on untapped inventory of large houses not serving their purpose, that could be freed up for larger families needing space, instead of seniors in a 3000 square feet house.
Another caveat is that these properties are occupied by those aging seniors for many decades, and getting older involves less care given to these houses. "They can't see the dirt anymore" or "can't bend over to clean up the spills" making some properties look outdated and in need of a serious remodel.
But this doesn't affect the value of the property as proven on video sent with the meeting's minute. For example, a house not taken care of for 7 years was sold for 1.7 million $ instead of an original listing price of 1.3 million $ in the Beverly Hills area.
The solution for these wealthy seniors would be to downgrade from a 5 million $ house to a 3 million $ house, giving them less real estate to worry about.
Having the intervention of such a specialist is interesting for a new inspiring agent like me, as it proves that standing out by specializing is beneficial for the one involved, as a real impact can be done (for example with an non-profit) and an leading the way in a respectful and passionate way can lead to success.