Where Have All the Sacramento Short Sales Gone?
My topic today — where have all the Sacramento short sales gone — brings up a few musical notes rattling around in my brain. Do you remember The Jayhawks and the tune Blue? It starts out: where have all my friends gone, they’ve all disappeared. Turned around maybe one day, you’re all that is here. That’s the song that a lonely Sacramento short sale agent who had not developed any other business is probably singing right now.
I received a chart a few days ago from the California Association of Realtors, which I have inserted above. It clearly shows the direction of foreclosures known as REOs, the short sales in Sacramento and the traditional equity sales. The dark blue on the bottom is regular homes in Sacramento for sale. It’s just about squeezed out the short sales and foreclosures, which is excellent news for our real estate market. Short sales are in red and the light blue on top is foreclosure homes.
It seems like only a few years ago that short sales dominated the market, and I went back to check. Sure enough, if you look at the time frame from November of 2010 through January of 2012, you will see that 36% of the market was short sales. Even more dramatic, 45% of the pending sales were short sales, and 32% of all closed sales were short sales.
The reasons why short sales no longer dominate the market in Sacramento are simple. We’ve had a huge uptick in appreciation. Our median sales prices rose about 45% across the board from the beginning of 2012 (which was the official Year of the Short Sale) to the summer 2013, when price increases leveled off. On top of this, most people who had ever thought about doing a short sale have already closed a short sale. These were the people who bought or refinanced from 2004 to 2009.
Today, those short sale numbers for Sacramento County in January 2014 are . . . are you ready for this? We closed 100 short sales. One hundred short sales. Is this like 100 bottles of beer on the wall? I could sing that song, too. They breakdown like this:
- Active short sales comprise 10% of the market January 2014
- Pending short sales comprise 16% of the market January 2014
- Closed short sales are 11% January 2014
I pulled those statistics from Trendgraphix reports. Fortunately, although I managed to accrue quite a specialty in short sales and even wrote a book about short sales in 2009, I still sold regular traditional real estate, and I’ve sold even more regular homes last year. I sell in the range of 8 to 10 homes a month, in case you’re wondering, so I see a wide spread of activity across our four-county area and move a lot of inventory.
Can’t say I’m sorry to see short sales disappear. They aren’t really my friend or anybody’s friend. They’re a regular pain in the neck but a necessary component of real estate for some sellers. If you’re thinking about doing a short sale, it’s not too late as there are so many good rules about short sales for sellers today that were not in place 8 years ago. It’s not the stigma it used to be, and most sellers pay no tax and have no liability because they are lucky enough to live in California. Our rules are different than other states. I can help. Nobody has sold more short sales than I have over the past 8 years in this region.
If you want more information, call Elizabeth Weintraub at 916.233.6759.
Image: California Association of Realtors