Sarah, not her real name, is retired and just sold her home in the Bay area. She is in a position to pay all cash for a home and prefers to live around other seniors in Sacramento. I suggested an area of Natomas called Heritage Park. This is an active adult community for people over the age of 55.
We toured 5 homes yesterday, one of which was a foreclosure. Now, Sarah really doesn't want to buy a bank-owned home. The problem with foreclosures is many of them need repairs. She also does not want to wait for short sale approval on a short sale.
After tour, Sarah's daughter asked me if there were any single story homes for sale in Natomas, near Heritage Park. I ran a search on that ZIP, looking for homes priced under $350,000. I found 5. Two we had already toured. Two were not yet built. One was not suitable. I looked in Gold River, too. But none of those was newer homes.
It pained me to advise Sarah that she either choose among the 5 we toured or rent for a while. This is the reality of the Sacramento real estate market.
Above is the Trendgraphix chart for August of 2009, covering all areas in Sacramento County over the past 15 months. You can easily see that inventory is continuing to drop. In June of 2008, we had 8,524 homes for sale. Today, that number is 3,281. Here is the percentage breakdown of homes that sold last month by price point:
- Under $200,000: 54%
- Between $200,000 and $400,000: 41%
- Over $400,000: 5%
I'm seeing a bigger increase in the number of homes selling between $200K and $400K. For most of the year, the pressure was on the under $200,000 market, but now it is shifting to a higher price point.
Another buyer called me last night to say she wants to buy a home in a certain Elk Grove ZIP code. Nothing fancy, just a two-story with four bedrooms. Needs to close soon, so no short sales. Do you know how many homes she has to choose from in her price range? Two. Exactly two.
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Certified HAFA Specialist
My Sacramento Real Estate Listings
Elizabeth Weintraub is an author, home buying columnist for The New York Times-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout the four-county Sacramento area. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you. Broker-Associate at Lyon Real Estate. DRE License # 00697006.
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Elizabeth - We are seeing the same activity in price ranges as your market. It is getting harder to find homes in the $300-$400,000 range that meet a buyers critieria. Lets hope private sellers come back to the marketplace soon.
Elizabeth - You're singing to the choir girlfriend. We're seeing the same numbers down here in LA & Ventura county too and all of the lower end ones are being scooped up my all cash investors. So far this month, I have had three of my clients who have been looking for most of the year tell me that they are probably going to be renewing their leases.
They have become so disgusted with the whole process that they simply can't do it anymore. Best of luck to you and your clients. :)
Very tight inventory in your market there Elizabeth making it tough on buyers. We are moving almost to a balanced market here from a fairly strong buyers market. Good luck to your buyers. They have to make up their minds.
That chart certainly demonstrates the entry level through mid-level housing market in our area is becoming a challenge for Buyers.
I have another buyer who came to me after working with an agent with whom he had offer after offer declined. We haven't made an offer yet because none of the homes / listing terms were suitable. That's probably why his offers were previously rejected. He shouldn't have been writing them in the first place. But I am confident that I'll find him the right home.
We have plenty of inventory here I'm hopeful we will get some of them off the books soon.
Wow, that inventory has been coming down for sure! The under $400,000 price range is moving pretty good here as well but especially $250,00 and under. Almost all that we are putting in an offer for the buyers there are at least 10 offers in. ~Rita
It's a good news/bad news snooze ya lose story 'Lizabeth...and should encourage buyers to move it more quickly....! Have a prosperous weekend !
Elizabeth: Beggars can't be choosers...why does that phrase come to mind? :) It's a rough thing to try and explain that what you see is what you get. I think some buyers honestly think we are withholding some wonderful listing. They go home and type franticially on Realtor.com to search for the house you can't find. I think we are well beyond the buyer's market in terms of equity. Pricing still seems to be good though.