Money and Investing Thoughts

Home Front: Roseville new-home market looks robust – Sacramento News – Local and Breaking Sacramento News | Sacramento Bee.

I have a couple of quick articles today about the Sacramento housing market. The one linked above from the Sacramento Bee had a couple of items about new home sales in the region that caught my eye.

First, new home sales for the region totaled 1,670 for the first half of 2009 compared to 4,695 for all of 2008. Extrapolating puts the 2009 sales at about 70% of the previous year. Less new home sales and inventory does help the absorbtion of existing home inventory.

Second, the average selling price for a new home was $376,679. The number is quite astounding when the median price for existing homes is around $180k. It shows how much of the repo sales market was at the bottom the regions housing picture. It also gives a peak at how bad the condition of some of the repo houses must be. Finally, the price differential shows how much money the bankers are leaving on the table in their rush to unload bank owned inventory.

California home builders are on pace to build and sell less than 50k new homes compared to the 20 year average of 140k. This will eventually help get inventory of all homes back in line with demand. California right now has some serious employment problems but this to shall pass.