An investor called me from the Bay area yesterday to inquire about the real estate market in Sacramento. She asked the familiar question: "Is this a good time to buy?" That's sort of like asking a street vendor with hot dogs for sale if it's a good time to buy a hot dog. What's the vendor going to say? No? He's got product to move.
But I am straight-forward with people. It seems like a good time to be an investor in Sacramento but it's a struggle. It's not easy to buy a house in this market. I suppose Bay area investors read the paper and see foreclosure filings are increasing. This fact would cause them to believe our market is flooded with foreclosures, which is not the case.
I just ran a check in MLS for status on real estate listings in Sacramento. At the moment, we have 3,691 active listings. If you include the active short contingent listings, there are 6,429 total homes, of which 62% are either active short sale listings or active short contingent listings.
According to Trendgraphix for September, regional inventory for the Tri-County Sacramento area has decreased 62% over the record high of 15,302 set in August of 2007.
There is little for sale; removing the short sales, we have 2,420 homes in Sacramento County, to be precise. At the moment, we have more real estate agents in Sacramento County than homes for sale as active listings.
On top of this, the average per-square-foot cost in Sacramento continues to rise, as evidenced by this first chart below:
Below is a snapshot of the number of homes for sale in Sacramento, the pendings and the sold listings for September:
The one thing Sacramento investors have going for them at the moment is very few first-time home buyers are chasing the short sale listings right now. That's because newer short sale listings are unlikely to close escrow by November 30th, when the home buyer tax credit vanishes.
It's a seller's market in Sacramento with buyer's market prices. Multiple offers are the norm because we have many buyers competing for the same homes. The pending sales are increasing and have shot up 9% in the Tri-County region over August. You can get a good deal, but you'll need to hire an experienced Sacramento real estate agent to get it.
Trendgraphix, used with permission.
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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.
The Short Sale Savior, by Elizabeth Weintraub, available at Amazon.com.
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The views expressed herein are Weintraub's personal views and do not reflect the views of Lyon Real Estate.
Disclaimer: If this post contains a listing, information is deemed reliable as of the date it was written. After that date, the listing may be sold, listed by another brokerage, canceled, pending or taken temporarily off the market, and the price could change without notice. It could blow up, explode or vanish. To find out the present status of any listing, please go to elizabethweintraub.com.
Elizabeth: What I like most about your market reports is that you EXPLAIN them. You don't just throw a graph up and expect people to understand it.
I so wish that would happen to the inventory in my area. We still have about 18 months supply. UGH!
It is fascinating to see what percentage of the inventory is short sales, and what percentage is REOs. Like Chris Ann states, you do a great job explaining the trends and market data!
Glad your area is going in the right direction. We see spurts of activity then it slows again.
Elizabeth,
Great post! I love seeing how markets are doing around the country- especially when it looks like they're going the right direction. Thanks for the update.
Your friend in the Cosmic Cow Pie.