Sacramento Real estate News & Trends
Sacramento real estate market trends and updates on the changing housing market from Realtors and brokers in Sacramento plus surrounding counties.
The Auburn real estate market, located within the larger boundaries of the Sacramento metropolitan area, saw an encouraging performance in the most recent tracking period despite regional weakness and high levels of foreclosure. Although the state of California had been showing encouraging gains in the number of homes sold in recent months, the month of February 2011 (the most recent period for which accurate figures are available) reversed that trend and ventured back into negative growth. For the entirety of California, there were just less than 500,000 home sales in February, a fall of nearly 50,000 from month-ago levels. This broader trend was echoed in the Sacramento metropolitan region, which saw a decline of approximately three and a half percent compared to both month-ago and year-ago levels. The median price figures for the city and state are disappointing, as both fell alongside the volume of home sales. An average home in Sacramento County cost less than $170,000, representing a decline of almost two percent from month-ago levels and a fall of more than six percent from last year. In contrast, Placer County, where Auburn is located, actually saw a month over month increase in median sales price (about three percent) despite a year over year decline (around six and a half percent) for the same metric. There were about three and a half percent more sales in Placer County compared to month ago levels and nearly fifteen percent more relative to the same time last year.
California’s foreclosure levels continue to be among the worst in the country, with Californian cities accounting for seven of the top ten high-foreclosure regions in the nation. In fact, a majority of Placer County’s real estate transactions involved some form of distressed properties. Although this may well have inflated the short term home sale volume figures, it also leads to the question of how much demand will remain after the flood of foreclosures subsides. A full 57% of sales in Placer County were foreclosures and short sales, and market inventory was just over three months (which is lower than usual). This suggests that there may soon be multiple offers for the same property, which in turn may inflate the median sales price of the region.
Sacramento, a part of California’s Central Valley, continues to suffer from widespread foreclosures and declining median prices. Any temporary bump that may have resulted from federal and state tax incentives is certainly gone, as the nation’s home prices fell for the sixth consecutive month and Central Valley properties faired even more poorly. Across the country, median prices plummeted by nearly six percent, following a five percent decline the previous month. Even controlling for the depressing effect of short sales and distressed properties, the average price fell by nearly two percent nationwide. The Central Valley and Sacramento metropolitan area were in an even more abysmal position, falling anywhere from seven to eleven percent compared to month-ago levels. Sacramento itself and the neighboring communities of Arden Arcade and Roseville saw an average decline of just less than eight percent relative to month-ago levels. Controlling for distressed sales and foreclosures, Sacramento still saw a median decline of almost four percent. Broadly speaking, the market still shows a shortage of housing demand, high levels of negative equity, and a struggling employment sector.
Although foreclosures in the Sacramento area continue to be extremely high relative to the rest of the nation, they actually declined significantly in the last available tracking period. Sacramento saw fewer foreclosures relative to both month ago and year ago levels, meaning that about one in every 189 properties received a foreclosure notice. Compared to last month, there were about twenty percent fewer notices of foreclosure, while relative to last year there were approximately nineteen percent fewer. Notices of foreclosure include any document pertaining to the foreclosure process, including notices of default, bank repossession, and notices of sale. Throughout the entire Sacramento area, there were 4,546 foreclosure notices filed in the month of February 2011. Although notices of foreclosure declined overall and in each individual category, Sacramento still remained one of the worst cities in the country in terms of foreclosure volume. Specifically, among the 206 largest metropolitan areas in the United States, Sacramento ranked 10th. Cities in California accounted for seven of the ten worst cities, a testament to a state that has been particularly hard-hit by the economic downturn.
A small community and the county seat of El Dorado County in the greater Sacramento region of the northern portion of the state, Placerville, California, is a modest, mostly middle-class community. Like other California cities, the Placerville real estate market was affected by the prolonged downturn in the U.S. economy, seeing home values shrinking, and troubled and foreclosed mortgage holders on the rise. The market still shows signs of a struggle, though some statistics are beginning to follow what could be a slowly sloping upward trend.
A quick search in early November showed a total of 258 Placerville homes for sale listed, ranging in price from as little as $65,900 on upward to as much as $5.2 million. The average listing sales price is around $407,000. At the end of the year in 2009, the median sales price for Placerville homes was $210,000. In September, the most recent month for which statistics are available via the Sacramento Bee's monthly zip code sales chart, that figure had fallen even further to $182,500, down 3.3% from last September's prices. Sales volume, too, plunged in Placerville in September, with volume down more than 40%, with just 16 homes sold over the month. The highest-priced home sold in September was a $365,000 one, and the average price per square foot in the month came out to $103, a decline annually of nearly 22%.
The numbers of foreclosures in Placerville has shown some promise, as countywide statistics show that the third quarter of 2010 saw just 504 foreclosures, versus 629 in the third quarter of 2009, a decline of about 20% on-year. According to Placer County Homes and Land realtors, at the end of August, there were 123 Placerville homes for sale, eight condos for sale and one plots of land. Of these listings, 40 were bank-owned listings and 31 were short sales, meaning the home's sales price is lower than the price the owners owe on it. Short sales and bank-owned sales thus make up more than half of homes for sale in Placerville, which suggests that those interested in finding low-priced deals in the community still have plenty of opportunities to snatch up a good find.
A census-designated place in Placer County, California, near the northern Pacific Coast, Granite Bay, California, is a residential suburban community in the Sacramento region. The town is a rather wealthy suburb, with median household income estimated in 2007 to be more than $115,000 in 2007, and higher real estate prices to match. The Granite Bay real estate sector saw home prices rising steadily prior to the U.S. economic troubles that began in 2008 and eventually exploded into the global financial crisis, which took its toll in California, crippling the local market as well as markets across the state and country. More recently, Granite Bay seems to be solidifying its position and seeing only slight annual declines, a sign that the market is steadying.
According to Placer County Homes and Land, as of early November, there were 154 Granite Bay homes for sale, ranging in price from a low of $169,000 to a high of $5.9 million. The average listing price stood at around $1.2 million. Twenty-one of the homes listed were active short sales, meaning the homes were listed for a price lower than what the current owners still owe on it, and six homes listed were bank-owned. There were no condos listed, as this area is more residential and consists mostly of single-family homes.
The Sacramento Bee's monthly zip code sales chart showed that for the month of September, Granite Bay there were 20 homes sold, an increase on an annual basis of 25%. The median sales price for September was $508,000, off just a slight 1.5% from prices a year ago, while the highest price was one home sold at $1 million. September's price per square foot average out to $186, a 3.8% decline from September 2009 figures. September's median price is also down slightly, however, from the annual median sales price in 2009, which was $516,000.
The number of foreclosures in Granite Bay is leveling out as well, matching the trend in the greater area of Placer County, where there were 1,200 foreclosures in the third quarter of 2010, down by more than 15% from the number of foreclosures in the third quarter of 2009, according to DataQuick Information Systems statistics.
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The Folsom real estate market, a primarily residential section of the Sacramento County housing market, has seen a disturbing rise in the number of foreclosures as well as a decrease in the number of new homes sales. An October 12, 2010 report from the Sacramento Business Journal noted that “Bank repossessions of homes during September in Sacramento County climbed to the highest monthly total in more than a year to 1,066 homes, online foreclosure tracker ForeclosureRadar.com reported Tuesday. That’s 34 percent higher than September 2009 and above the previous high mark of 1,035 set in March. However, notices of default and trustee sales notices were down in Sacramento in September compared with the previous month and September 2009. The number of homes sold to a third party at a foreclosure auction was also lower, by about 34 percent, from the previous year. The company noted it had not seen any effect yet in California of the moratorium on foreclosures by some lenders who had used automated processes for completing foreclosures.”
Fewer new Folsom homes for sale were sold in the most recent tracking period, although it seems that the overall market in the capital region may have stabilized somewhat. According to an October 15, 2010 report from the Sacramento Bee, “Sacramento's new home market just keeps getting worse, and that's holding back the region's economic recovery. A mere 288 new homes were purchased in greater Sacramento during the third quarter, according to a report to be released today. That's less than half as many as a year ago, and a further drop from the previous low of 485 homes sold in the second quarter…New housing construction in the six-county region has fallen to its lowest level in at least 40 years, according to the Construction Industry Research Board. The latest numbers offer more grim testimony to the health of the economy – and the problems facing home builders in a buyer's market. The overall housing market has stabilized somewhat, but much of the activity consists of foreclosed homes being sold cheap. With nearly-new homes available at rock-bottom prices – and the job market still weak – there's little appetite for new construction. "For some of these builders, the competition … is product they built a year ago that's now in foreclosure or short sale," said Greg Gross, an analyst with market researcher Metrostudy.”
The El Dorado Hills real estate market, a subsidiary of the larger Sacramento real estate metropolitan area housing market, saw a few discouraging signs in the most recent tracking period, including a dearth of new homes being sold in September, August, and July. The recent controversy over foreclosures has also added more uncertainty to an already unstable market. According to an October 18, 2010 report from the Sacramento Business Journal, “Homebuilders sold a record-low 288 homes in the six-county Sacramento region during the three months that ended Sept. 30, another indication that the new-home market won’t bounce back this year despite initial hopes to the contrary. Builders had been scooping up finished lots earlier in the year, but those lots appear to be sitting unused as buyers lost interest after tax credits designed to spur home sales expired. “This is no shock to anyone,” said Greg Paquin, founder of The Gregory Group, which released the report today.”
The controversial practices of several national lenders have resulted in considerable uncertainty for El Dorado Hills homes for sale as well as regional homeowners. According to an October 21, 2010 article in the Sacramento Bee, “The foreclosure mess that's roiling the real estate market from coast to coast is causing plenty of uncertainty here in Sacramento. Those who've lost a home to foreclosure wonder if they'll get their house back. Sellers are in limbo. Ditto would-be buyers. And those who've recently bought a foreclosed property now worry whether their purchase was properly documented. "There's a lot of confusion about what this means," said Pam Canada, CEO of the nonprofit NeighborWorks Homeownership Center in Sacramento, which gets dozens of calls daily from folks in various stages of foreclosure. So what does it mean? Despite disclosures of sloppy documentation by nationwide lenders handling foreclosures, the situation is largely a "paper shuffle" that's not going to change things for struggling homeowners, Canada said…All the uncertainty stems from allegations that banks and mortgage servicers including Bank of America, GMAC, JP Morgan Chase and others were improperly rubber-stamping untold thousands of foreclosure documents…The impact has rippled throughout the real estate foreclosure community nationally and in California.”
The city made famous by the song sung about it by country music legend Johnny Cash, Folsom, California, is a city in the Sacramento region. It's a mostly upper-class area, with a 2007 median household income for residents of around $87,000. The market for Folsom real estate, like so many other Sacramento real estate markets, has felt its share of pain since the financial crisis began to grip America and housing markets across the country began to fall.
According to statistics from the Sacramento Association of Realtors, which regularly compiles sales figures and numbers, in August, there were 51 homes sold here. This was a decline from 68 in July and a decline from 64 a year ago. So far this year in the first eight months, there have been 438 homes sold in Folsom. Of the 51 August sales, eight were short sales, 10 were repo homes and 33 were conventional homes for sale in Folsom closed.
The median sales price for homes sold in Folsom in August was $350,000, down from $377,500 last month and down from more than $454,000 a year ago. The median price for conventional homes sold was $371,500, while the median price for foreclosures in Folsom was $278,000. The number of new homes listed in August was 68, down from 81 in July and 79 a year prior. The total number of inventory stood at 246 in August, down from 267 in July and 277 in August 2009.
The Roseville real estate market, part of California's Central Valley and a subsidiary of the larger Sacramento real estate housing market, is seeing substantial weakness despite some inklings of strength after the expiration of the federal housing tax credit. An article from the Sacramento Business Journal noted that this trend was mirrored at the state level as well. According to the August 23, 2010 report, "New-home sales in Sacramento and statewide continued their downhill slide in June, the California Building Industry Association reported Monday. The monthly report by CBIA/Hanley Wood Market Intelligence showed statewide new-home closings in June were off 36 percent from a year ago. During the month, 2,454 new homes and condominiums were closed across the state, compared to 3,848 a year earlier. Closings of single-family homes were down 17 percent, while sales of townhomes were off by 57 percent. Condo sales were 67 percent lower than a year ago. The sale of new single-family homes in Sacramento fell 17.8 percent in June compared to a year earlier, but the 203 closings still represented a 16 percent rise from May’s 175 sales. The median price of Sacramento-area new homes, meanwhile, rose year-over-year 2.2 percent to $312,700. That’s down $1,000 from May. Statewide, compared with the same period last year, the median base price of homes sold was 3 percent higher than a year ago."
Roseville homes for sale actually fared better than the rest of the country, although the declines in the region were still substantial. According to an August 23, 2010 article also from the Sacramento Business Journal, "California’s existing home sales — including the Sacramento region — fared slightly better. The Golden State’s existing home sales fell 20.8 percent in July, compared to June. Despite the drop in sales, the state’s median home price increased 10.4 percent to $314,850 in July, compared to a year ago, according to the California Association of Realtors. Statewide, home prices have increased nine consecutive months — including seven straight months with double-digit gains compared to a year earlier... Home prices dipped 3.6 percent to $285,000 last month in the county, with Granite Bay and Rocklin homeowners suffering the largest declines at 12.1 percent and 7.6 percent, respectively."
The Rocklin real estate market, found in the Central Valley of California part Sacramento real estate market, is showing signs of slowing and continued trouble. The expiration of the federal tax credit likely played a role in this stumble, and foreclosure rates have also started to increase. According to an August 3, 2010 report from Rocklin and Roseville Today, “Not surprising, according to the National Association of Realtors (NAR), pending home sales are down with near-term sales expected to be lower in comparison to the spring surge when buyers were rushing to take advantage of the home buyer tax credit. Lawrence Yun, NAR chief economist, said lower home sales are expected in the short term. “There could be a couple of additional months of slow home-sales activity before picking up later in the year, provided the job market continues to improve,” he said. “Over the short term, inventory will look high relative to home sales. However, since home prices have come down to fundamentally justifiable levels, there isn’t likely to be any meaningful change to national home values. Some local markets continue to show strengthening prices.” Yun expects mortgage interest rates to remain historically low for the balance of the year, with very modest growth in employment. “We really need to see stronger job creation to have a meaningful recovery in the housing markets,” he added.”
A higher proportion of Rocklin homes for sale are the product of foreclosure, according to a report by KXJZ News. According to the July 19, 2010 piece, “Daren Blomquist is with RealtyTrac. He says Stanislaus, Merced, San Joaquin and Sacramento counties are among the top ten regions with the highest foreclosure totals. The latest figures reflect the first six-months of the year. “…although those counties are showing for the most part decreases in foreclosure activity over the same time period a year ago. If you go down to San Francisco, it’s very low in terms of foreclosure rate. However, the San Francisco foreclosure numbers are actually up 35% from a year ago. So, it’s kind of a mixed bag.” Blomquist says a new wave of foreclosures could be coming, especially if the jobless rate stays high; mortgage-assistance programs end; and the economy doesn't improve fast enough to lift home sales.”
The county seat of Placer County, Auburn, California, is located in the north eastern part of the state and was estimated in 2009 to be home to a population of just over 13,000. The city is considered a part of the Sacramento–Roseville Metropolitan Statistical Area, and lies only about 30 miles northeast of Sacramento.
The Auburn real estate market saw mostly signs pointing to steadiness in the most recent quarter of 2010. According to the Placer County Homes and Land report regularly compiled by local real estate agent Patrick Hake of Re/Max, the second quarter, which includes the three months of March through May, saw 94 homes sold, unchanged from the 94 homes sold in the area during the first quarter of 2010 and up nearly 50% from the second quarter of 2009. The second quarter saw slightly fewer condos sold, with 18 sales versus 21 in the first quarter. Land sales, however, were up in the second quarter, with 10 sales over six in the first. The median sales price fell slightly year-over-year, coming in at $316,950, down less than 0.2% from $317,500 in the second quarter of 2009.
The Auburn homes for sale that closed in this quarter included 40 bank-owned Auburn foreclosures and 26 short sales. Those figures represented a drop in the number of bank-owned properties sold (there were 49 in the first quarter), while short sales remained steady (the first quarter saw 25). The Auburn homes sold during March, April and May ranged from a foreclosed condo $38,000 and a $1.34 million home.
In mid-April, there were 188 Auburn homes for sale, and by mid-June, that figure had fallen a slight 2% to 184. The average asking price in mid-April stood at around $464,000, a figure that had fallen to around $457,700 by mid-April. The median asking prices, meanwhile, rose in June to $375,000 from $365,000. The number of pending home sales rose 13.6% from mid-April to mid-June, from 44 to 50.
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