Sacramento housing sales up again
Business – Home sales up for 2nd month – sacbee.com
I wrote on this subject last month, when the Sacramento real estate market had it’s first year-over-year (YoY) increase in houses sold in several years. I read and write about the Sacramento market for a couple of reasons. First, I lived there for about 5 years (until last fall) and I am very familiar with the market and area. Second, outside of possibly Las Vegas (lived there before moving to Sacramento!), the Sacramento region was one of the hottest markets before the recent melt down and may be a leader in the recovery.
For May, the Sacramento region had its 2nd month in a row of year-over-year home sales. Total sales of 3,420 were 6.3% higher than May 2007 and 8% higher than April 2008. The peak May sales occurred in 2004 with 6,761 homes sold. As would be expected, there are some positive and negative numbers in the month’s results. Here are a few of the more interesting facts:
- 51% of the closed sales represented previously foreclosed residences. 10,224 homes have been foreclosed on year to date and 5,448 repossessed homes have been sold.
- The for-sale inventory of 12,366 is the lowest in 14 months, representing a 4 month supply based on the May sales. Last month I reported 12,606 homes listed for sale.
- Median home prices were down, by county, 12% to 35%, directly proportional to the percentage of repos sold. Sacramento county, with 61% sales of foreclosed homes had the biggest median price drop.
- New home sales totaled 476 compared to 726 sold in May 2007.
- Investor purchases were 19% of sales, compared to 27% at the peak of the real estate boom.
It appears the region is working it’s way out of the real estate boom/mortgage meltdown hangover. I think the next step is getting to the point where repo sales are a small portion of total sales (maybe less than 25%) and find out where the “real” housing prices settle. I will close with this quote from a local real estate agent:
“There are so many investors and first-time buyers out there. … I don’t see that changing. I’m getting multiple offers on many of my good listings,” she said.
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The number of sales had increased in the last 2 months comparing to prior months but prices keep dropping, I still find it mysterious that many people are over-bidding on properties and the market keep going down and we will have more and more foreclosures in the market because of the huge amount of loans that will be reste in the next 2-3 months