The city once considered the butt of Bay Area jokes is apparently getting the last laugh.
The national phenomenon of a sellers’ market has reached Vallejo — big-time. Homes are selling for significantly more than the asking price — great for the seller, not-so-great for the buyer, and a dogfight for roughly 400 real estate agents scrambling for the meager 44 single-family homes available in Vallejo.
“It’s just a hot, hot market,” says Todd Willis, real estate agent with Coldwell Banker/Solano Pacific in Benicia, where just seven single-family homes are up for grabs.
In the last 30 days, Willis has sold one Vallejo house for $25,000 over the asking price and another $20,000 over the asking price, plus a “little condo” for $5,000 over the asking price.
Willis compared the home-buying activity to the “toilet paper buying frenzy” at the start of COVID-19.
“I’ve never seen anything like this in Vallejo,” Willis said.
A non-pandemic year? Probably 100 homes typically for sale, said Pippin Dew, Realtor for Re/MAX Gold in Vallejo, adding that the average house on the market here is an “even more surprising” $545,000.
Dew’s latest sale — 1165 Azuar Drive on Mare Island — sold this week for $765,000, some $65,000 more than the asking price. Dew said she’s had one home sell for $150,000 over asking.
The past year has been the hottest for sales activity nationally in 14 years, according to Zillow Group Inc.
It’s basically a combination of mortgage rates dropping, new-home construction lagging behind demand, homeowners holding onto houses longer, millennials aging into prime-home buying years, and, thanks to the pandemic, many now working remotely seek more space, reported the New York Times. And many who delayed relocation because of COVID-19 post-vaccination feel safer to pack up and move.
Dew agreed with most of the assessments.
Because of the pandemic, “the broad acceptance of work from home with large employers has allowed people to be less bound by the physical location of their employer,” Dew said. “This has allowed people to begin considering areas farther away from their employer as places they may wish to live.”
Many families have had to create “classrooms” in their homes to accommodate distance learning and “between the need for classrooms and work from home office space, people are looking for larger homes with more bedrooms,” Dew continued, adding that “with the stay-at-home orders, many people decided they wanted their home to be a more pleasant place to be, which has increased demand for larger yards. Broadband connectivity with access to high-speed internet is a must.”
Vallejo is the No. 3 hottest real estate market in the country, said Tim Hiemstra of Napa River Realty based in downtown Vallejo.
“I’ve been a real estate broker and agent since 1998 and I’ve not experienced anything like it,” Hiemstra said, with the “bigger story” being the “overwhelming demand.”
Last Friday, Hiemstra put a house on the market for $700,000. Four days later, the house was in escrow without an appraisal contingency for $775,000. The same property sold less than five years ago for $506,000.
“Buyers are competing for limited inventory,” Hiemstra continued. “I’ve noticed many of the buyers are millennials moving from San Francisco and the Silicon Valley.”
Willis agreed, with the pandemic-caused you-can-now-work-from-home aspect allowing people to live anywhere.
For Sarah Rennison, that meant Fairfield after she decided to sell the 1915-built Azuar Drive home across from St. Peter’s Chapel
After Rennison’s mother, Jane, died in 2018, and her father, Douglas, died in 2019, it was “time to move on,” she said Thursday afternoon.
“As much as I loved this house, it was too emotional for me to stay,” Rennison said.
So she, her 10-year-old son and 9-year-old daughter moved to north Solano County.
“I’m excited,” Rennison said, grateful that, as Hiemstra and Dew point out with numerous other Vallejo homes, the sale wasn’t contingent on appraisals.
“It’s a beautiful house. It’s too unique to put a number on it.” Rennison said.
For married couple Harvey Gonzalez and Gina Berard of Vallejo, it was all about timing.
“It’s a good time to be on the selling side rather than buying,” Gonzalez said.
The couple’s home on the 600 block of Carolina Street was on the market less than a week when an offer for $820,000 — some $20,000 more than the asking price — arrived. The home, including two rental units, is in escrow.
Gonzalez said he’s not surprised at the value increase since the couple bought the house for $295,000 in August 2009.
“I’ve always been optimistic about Vallejo knowing how far it fell after the bankruptcy” when the global economy collapsed in 2008, Gonzalez said. “The only way to go was up. I’ve always believed in the potential of Vallejo.”
Gonzalez said it’s more nerve-wracking than thrilling to sell their home — huge profit or not.
“It’s not exciting. It’s daunting,” he said. “I’ve never done this before. There are a lot of unknowns. We’ll figure it out along the way and work through them, I guess.”
It definitely helps relieve some pressure knowing he’s selling by choice and doesn’t have to relocate.
“We’re definitely not strong-arming anyone to buy the place,” he said.
Gonzalez said they want to be closer to his wife’s work in San Francisco and they plan on renting until it becomes closer to a buyer’s market than seller’s.
“It’s bittersweet,” said Berard. “I really love our house. It’s going to be sad.”
Gonzalez said he’ll miss Vallejo’s weather, the waterfront and the city’s character. hoping Vallejo is able to build a better reputation and image.
“It’s like the hot girl who doesn’t know how to dress,” Gonzalez said.
