sacramento housing report
August 2020 Sacramento area housing market report is an excellent and exciting blog and makes you think. Every buyer out there in Sacramento should read this report. Enjoy. — JaCi Wallace
Trends in real estate are ever fascinating. Just as a flock of birds in the sky suddenly move in a different direction altogether, seemingly for no reason. The momentum in real estate is too omnipresent. Some people think greed and emotion have always driven the markets and real life in general. I think the driving common denominator of the two is desire.
As much of the west coast is on fire right now, the Sacramento area real estate market is red hot, meaning multiple offers, sales prices over list price, and more. The August 2020 Sacramento area housing market is making eyes water, much like the horrible smoke that has filled the west coast skies for weeks. The fires burning over 2 million acres, which by the way, is about the size of 10 New York Cities. The desire of buyers and sellers to buy and sell is essentially an effort to better their situation they deem needs to be better.
The Law Of Supply And Demand
Look at the green graph above. For three months in a row, housing inventory (light green) in Sacramento County has been eclipsed by the solds (dark green). That is not supposed to happen. Imagine having 10 people in a store all trying to buy the last package of toilet paper. Wait, that actually happened. Well, you know what I mean. The law of supply and demand says that the price of that package of TP must increase if there is more TP demand than there is TP supply. Whoever desires it the most will get it. Prices either increase or the product runs completely out. Now I don’t think housing supply will run out, but the August 2020 Sacramento area housing market is suggesting a change could be coming. That change could be a reduction in prices OR a spike in the already record-breaking median home price of $425,000 that August gave us.
Median Home Prices
For three consecutive months, inventory was lower than closed sales. For those same three months, the median home price in Sacramento county broke records each month. The latest home price increase is 10% higher than the August 2019 median. We know that homeowners are hesitant to sell because even though many of them have tons of equity right now. The challenge sellers see they would be put into the buyer’s shoes and suffer the headache of trying to find a replacement home amongst all this crazy competition. If homeowners only knew that they could stay in their home until they closed escrow on a replacement home.
Another perc for a potential seller is that if they are 55 or older they could possibly take their base year tax level with them to a replacement home. This property tax adjustment could potentially save them up to thousands of dollars per year. Realtors that are in love with their career know these things and can help people navigate tough markets just as well as they can in more normal markets. The trick is cutting through the noise and gaining the trust of individuals who are looking for a Realtor to trust.
Average Days On Market
Look at the chart above. Trends usually tell us a lot about what to expect about the future, so when we are seeing the opposite happen, you know that change will follow change, for better or for worse. If you see what was happening last year with the Average Days On Market, homes were sitting on the market longer and longer as the months progressed from June 2019 through October 2019, which typically means price reductions.
There was a slight dip in November, but then the OMD (on market days) continued to climb through Jan. August 2020 saw a decline in OMD’s and an increase in the percent of the final sales price vs what the seller was originally asking. Some homes do sell for under asking, but that is because the seller was overpriced, to begin with. A top-producing real estate team can sniff these deals out and on the flip side, make sure your home sells quickly and maybe even over what the comparable homes in the neighborhood sold for.
Will Prices Go Even Higher?
The August 2020 Sacramento area housing market is raging. Will prices go even higher, or will it all fall apart? I think prices will continue to go up in our area, and neighborhoods will continue to change. I know that you don’t need me to tell you that a lot is going on in the world right now. But, don’t forget that Sacramento is two hours away from one of the wealthiest areas (Bay Area) in one of the wealthiest countries on earth.
The most successful businesses in history in the Bay Area have learned this year that many of their employees can work from home now. Why wouldn’t those top earners move to a place that is close enough to commute to work if needed, but far enough away to get what they deem as a bargain on a home?
To meet your home buying and home selling desires, call Weintraub & Wallace Realtors with RE/MAX Gold Real Estate. We have over 100 years of experience in the greater Sacramento four-county area real estate market. Call us today at 916-233-6759.
— Josh Amolsch
July 2020 Sacramento County housing market update written by Josh Amolsch, is a terrific post, very informative, ENJOY!
Come January 2021, we may look back at the year 2020 and conclude that “unprecedented” was the word of the year. I can think of a few more words too, but that would be for a different blog. That word comes in to play for the July 2020 Sacramento housing market update in a couple of areas. But the driving factor here is nothing new. Inventory is the culprit of rising prices. Take a look at the Month of Inventory for July 2020. I could not find one instance in the last 15 years when the Months of Inventory was at .7 months except for July 2020. Unprecedented. This is down 46.5% from July 2019. Sacramento’s real estate has proven to be very strong during the COVID-era. Stronger than ever, in fact.
Did you hear that one about the 30-year fixed-rate mortgages averaging 2.88% for the week ending August 6th, according to Freddie Mac? Yeah, insane. I have talked to a few people over the last week or so who are waiting to buy “when there is a dip in the market.” Well, a dip may come.
But no one I know sees that happening anytime soon, and I hang out and know some of the best Realtors and Lenders Sacramento has ever seen. Check out the Median Home Price in this July 2020 Sacramento county housing market update. Up 8.5% from July 2019 to $423,000. Unprecedented. We have hit four records for Median Home Price in Sacramento county this year.
The Sacramento County Housing Report for December 2019 comes to us from team member Josh Amolsch. Josh is out there every day in the trenches, working relentlessly. He knows the inventory and how to find the homes his clients dream about. As a well seasoned professional Realtor, Josh knows the market pulse and shares his experience with you in his monthly market trends blog. Enjoy. — JaCi Wallace
The Sacramento County Housing Report for December 2019 includes only Sacramento County single-family homes. No other criteria are included in this particular report. This singular focus of sales gives us a deepened understanding of what is happening in our area. If you want to receive updates for a specific area, a ZIP code, multiple ZIP codes, multi-family properties, and / or land, sign up here for your Sacramento housing report by ZIP code.
We start a new decade in Sacramento County with housing stats that are leaving many prospective homebuyers and sellers to wonder: how to proceed? Is it time to buy, sell, refinance or wait? Before we get into the latest numbers that came out recently, I want you to pinch yourself really hard. Do it because the pain that you will feel is not nearly as bad as the pain that you may feel if you go out to look for a home to purchase this year without a rock-solid game plan. This plan should include hiring an experienced exclusive buyer’s agent to help guide your expectations and align them with reality in a seller’s market.
The top graph shows that the number of homes for sale in Sacramento County fell 30.4% from November 2019 to December 2019. This is down more than 45% from December 2018. Look at the light green column compared to the dark green column right above 12/19 in the graphs above. In the last 5 years, we have not seen those metrics been so close. This is a first in the last 10 years that new listings fell so much lower than the pended sales. Along with inventory being so low, buying activity ticked up 10% from December 2018 to December 2019. The perfect storm is brewing. Sellers can put a home on the market and potentially receive multiple offers with very favorable terms on homes priced to sell.
The average cumulative days on the market jumped up to 38 days in December. This was a 15.6% decline from last year at the same time. What is interesting is the sellers are still receiving 97% of the price they originally listed at, which means sellers at first blush often feel they can get more than market. Lowball and unrealistic offers from uninformed buyers are often ignored. Competition from the influx of buyers from surrounding areas won’t allow a poor strategy to bear fruit. The California Association of Realtor’s report shows that housing affordability in Sacramento has been hovering around 65% since the second quarter of 2015. By comparison, our neighbors in the San Francisco Bay Area are averaging 43% in Q3 2019.
We predict that prices will continue to push forward while interest rates are widely expected to remain muted. If you have been unable to pin down a home in an area that you want to live in, then give us a call. We will give you some ideas you may not have thought about. Our team has been at this for many decades and are eager to help! If you want an edge in this extremely competitive market, call Weintraub & Wallace Realtors, with RE/MAX Gold at 916-233-6759.
Are you wondering whether median prices of Sacramento homes have recovered from 2006? If you’ve been watching the housing market in Sacramento for any period of time lately, you’re probably blown away by rising prices. You can’t spin around without finding limited inventory, multiple offers and getting priced out of the market. In fact, many buyers probably wonder just how high can prices go?
Are we back to where started in 2006, at the height of the real estate market? Does this mean the median prices of Sacramento homes have recovered from 2006 to 2018? We’re very close, but the fact is we are not there yet. You might think we’re out of the woods by all of the sales activity and pent-up demand for homes, but the statistics from Zillow tell a different story.
Of interest, there are four communities, upper-end, more affluent areas, which have moved past the median sales prices from 2006. Those areas are El Dorado Hills, Granite Bay, Folsom and the city of Davis. The bounce back rate for Davis is 115%, meaning median prices have surpassed 2006 by 15%.
The chart below shows the percentage of 2006 values that each neighborhood or city has reached in June of 2018. This data was extracted from the Sacramento Bee story and not verified as sourcing from Zillow.
If you’d like to know whether median prices of Sacramento homes have recovered from 2006 to 2018, the percentages below might astonish. As always, feel free to call your Sacramento Realtor, Elizabeth Weintraub, 916.233.6759, for more information.
City and Percentage of 2006 Median Prices to 2018
Rio Linda 89%
South Lake Tahoe 93%
Rancho Cordova 92%
Elk Grove 94%
West Sacramento 96%
Citrus Heights 95%
Fair Oaks 97%
Shingle Springs 100%
El Dorado Hills 101%
Granite Bay 101%
Even a busy Sacramento Realtor has to stop every now and then and look at the Sacramento Housing Report. This report includes the last 15 months of sales. It shows the number of homes for sale in Sacramento County, the number of homes that are pending and the number that closed for each of the last 15 months. Bear in mind that the pending sales in a previous month could very well be the sold sales in the following month, which means there could be a 30-day or so lag.
For example, this past December, we saw an uptick in sold sales but December pendings had fallen. That’s because many loans were delayed due to the new government TRID guidelines put in place last October. The homes that closed in December most likely rolled over from the pendings in October. I know I had four closings in December that were delayed yet managed to close in 2015, thank goodness.
The bottom line, no matter how you look the numbers, and I have laid them out below for you, we have little inventory in Sacramento. Not very many homes for sale. Which makes this a seller’s market. And prices are going up. The sold prices have appreciated 10.2% over the past year. Our median sales price, one of the best indicators of market movement, has shot to $297,000 from a low of $255,000 a year ago.
If you’re thinking about selling your home, you might want to call top producer who will pull out all the stops to market your home everywhere possible in the Internet world and real-life world — a veteran broker with 40 years in the business — Elizabeth Weintraub at Lyon RE. Call 916.233.6759. California BRE # 00697006.
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