sacramento housing market
Sacramento May market housing trends 2019 show a continuing seller’s market dominance. There is 18% less inventory than 1 year ago at the same time. With a continuing 1.4 months of inventory with no sign of an inventory increase, The market will continue to squeeze the buyers over the summer. There is no visible trend that inventory is increasing.
Buyers better get realistic on clean offers and doing whatever it takes to win. This is a rude awakening to buyer’s agents. Buyers better get your real estate offer toolbelt on. Sharpen your tool belt and hold on, as it is going to be a rough and wild ride. Buyers who are looking for a deal, it is not going to happen.
There seems to always be good news and bad news in a Sacramento real estate market update for single-family homes. The really bad news (because I always like to get the bad news out of the way first) is we have only 1,318 homes in Sacramento County for sale (not counting condos). That’s pitiful. It’s really low. The only thing that makes it worse is the fact we have so many interested buyers who would like to buy a home and there are not enough homes for sale to satisfy that demand. Which happens to be the good news: there are a lot of buyers out in the April market.
Our pending sales (in escrow, waiting to close) are 1,547 homes. The single-family homes that have sold in the month of March number 1,326. No matter how you look at these numbers, we have fewer single-family homes for sale than the number pending or the number sold last month, which means without new listings, we could shut down the real estate market in about 3 weeks. There’s your Sacramento real estate market update in a nutshell.
Tell me about it. I’ve been closing escrows left and right lately. I can’t keep a home on the market longer than a week to save my life, not that I would really want to make a seller wait any longer than necessary, but geez, I get attached to my listings and then they are gone. I have quite the large number of listings in my lineup right now that I’ve been working on, some for months.
One of my soon-to-be-on-the-market sellers asked me yesterday, how can you do my open house when you have so many properties to sell? What properties to sell? They have all sold. Every single one of them. Sold. S-O-L-D. I have not had zero listings in my inventory for maybe 10 years. OK, says the client, but you’re getting probably at least one a week. Yes, but then it sells. S-E-L-L-S. She was worried I would not have time for her.
You’re my sole focus, I assure her. Get that furniture out of the master bedroom, clean up the house and let’s sell it. She’s already done all the hard work and the repairs that were needed. Let’s get that baby on the market. If I have to be in twenty places at the same time, I can work that magic. Why, I can remember juggling 75 listings about 6 or 7 years ago. I’ve got all of this energy and no place to direct it.
If you’re looking to sell a home in Sacramento and would like to hire a top Sacramento Realtor with more than 40 years of experience, call Elizabeth Weintraub at 916.233.6759. Sellers should capitalize on this momentum.
Where is the Sacramento housing market headed? You might very well sing the answer. Where have all the houses gone, long time passing. Damn, if we couldn’t use a peace-loving force like Pete Seeger right now. I find it disturbing to read pieces by our trusted journalists because all of the articles are loaded with, well, news: Trump did this atrocious thing and Trump did this horrible thing and Trump did this other completely outrageous thing, and it’s disheartening, sad to the point of sobbing, miserable news. Lots of kudos, though, to those who are fighting the right fight, standing up, asking questions, demanding coherent answers, leading the way with progressive values.
But back to the Sacramento housing market. You didn’t come to my blog to listen to me rant, even though with our current state of affairs, it’s almost impossible not to. Our housing market is in big trouble with a capital T. I can’t get away from music today. At least it doesn’t stand for Trump. It’s a capital T that rhymes with C and stands for curtailed. Our housing inventory in Sacramento has been curtailed, diminished, reduced, cut, slashed and fallen off to the extent our pending sales are about to exceed the number of houses for sale.
You can see it clearly in the image above, copyrighted and used by permission from Trendgraphix. Our total number of houses for sale last month was 2,586. Not only is it the lowest number of homes for sale in Sacramento over the past 15 months, to give you a better comparison, it’s fallen about 80% from of our all-time high from August of 2005. Without any new listings, we could sell every house in Sacramento over the next 45 days. A month and a half. That’s tight inventory. So tight it squeaks. It’s a seller’s market.
Almost across the board, everything else is up. Pending sales (those homes that are in escrow but not yet closed) are up over last month by 17.6%; pending sales have increased over the same quarter a year ago, and same month a year ago. More homes closed in December than in January, but that’s because December’s closings were pending sales from October and November. December itself is seasonally a slow month. It’s why I take my annual wor-cation in Hawaii in December.
The second biggest story about the Sacramento housing market, apart from low inventory, is the whopping increased number of pending sales in the first two weeks of February. We are up 44.8% in pending sales over the first two weeks of January. That means demand is extremely high. Buyers are off the fences and ready to buy. Multiple offers are more the norm than not. Our inventory dropped another 8.5% since January 1. And prices are relatively stable at $208 per square foot, as it has been for the past half year.
If you’re looking to buy or sell a home in Sacramento, call the Elizabeth Weintraub Team at 916.233.6759. We can make sense of what’s going on and guide you.
We can talk about low inventory until the cows come home in Sacramento, but the biggest news in the Sacramento housing market report is that prices are slowly creeping up. You can clearly see this reflected in the average price per square foot above. What you don’t see is January 2017 average price per square foot, which is $203. Why is this relevant?
It’s important because we rarely see a price jump in January, usually it is the opposite, and January starts off a little bit slower. Our inventory is relatively the same in December as it was a year ago in December, standing at 1.1 months of inventory. This low inventory is so low if you were trying to dance the limbo under that bar, you would fall flat on the floor and likely break your back.
It’s a seller’s market in Sacramento real estate, in full fury.
This means if you are a seller, put your home on the market. Do not shuffle your feet. Get that lovely home into MLS as soon as you possibly can and start showings. Every new listing, even the ugly homes, is like tossing bird seed to starving pigeons in the park. Buyers come running from every direction to feast on table scraps. Elbowing each other.
We are seeing multiple offers on almost every listing as well. It’s not as crazy as it was at the bottom of the market, like in 2011, where we could receive 20 or 30 multiple offers on a single listing. I’m seeing more like 2 to 4 offers per listing. That seems much more manageable. If it’s a fixer property, the number of multiple offers tend to be higher.
But what difference does it really make how many offers a seller receives? As long as there are two offers, a seller can negotiate with the Seller Multiple Counter Offer, which has been known to bump up the price. Everybody wants what somebody else wants. And hey, bottom line, we only need one committed, strong and qualified buyer anyway. While it’s nice to tell your friends how many buyers fought over your house, it’s much better to say you got top dollar and no hassles.
If that’s your objective, call a top producer Sacramento Realtor with more than 40 years in the business. Call Elizabeth Weintraub at 916.233.6759.
Low inventory in the Sacramento housing market tends to generate multiple offers for the super desirable homes but there can be unintended consequences for sellers. Now, even homes that are not super desirable or maybe have some sort of drawback that makes potential home buyers pass it by are receiving more than one offer, as compared to the slower activity in the 4th quarter of 2015. But this year’s start on the Sacramento housing market is very different from last year’s. What is making the difference in the low inventory this year is the low number of comparable sales available for an appraisal.
Of course, this is dependent upon area and the individual micro markets but if an agent, for example, bases sales on the last 6 months, predicting an upward swing will carry the momentum, an appraiser will use only the last 3 months. That means a February appraisal will use comps from November, December and January. Our January inventory is 27% less than our inventory from January 2015, which was mind-blowing low to start with. Low inventory can drive higher prices as buyers outbid each other. However, not every home will appraise if the number of comps available in that neighborhood are very low.
You can already see this formula at work in the median sales price in our Sacramento Housing Market, which has now dropped to $282,000. It has basically held steady from last May, around $290,000, jumping to $296,000 in December, but our January median home price has plunged by 5%. Our pending sales are rising due to the low inventory but will those homes appraise at value? What happens when pending sales outnumber the homes for sale?
Sellers sometimes don’t realize that February sales will be based on Nov-Jan comparables, and if those numbers don’t add up, it doesn’t matter which way the market is moving or how much a buyer will pay if the home won’t appraise. You can’t go to Zillow, pluck random sales and hope an appraiser will use those same numbers because they are probably too old.
Now, more than ever, you need an experienced Sacramento Realtor to help you navigate the market and to determine an appropriate course of action for you. There is a profit for sellers in a Sacramento housing market with low inventory, but it is all dependent on marketing strategy, negotiation skills and the last 3 months of comparable sales. You probably won’t find a more experienced agent than Elizabeth Weintraub. Call today at 916.233.6759.