....and it looks like buyers a coming back into the market. Even the Sacto Bee had a positive Real Estate Article last week.
It's true, new home buyers who have been waiting for prices to come down, are figuring out that homes are now affordable, and mortgage rates remain great along with first time home buyer programs.
This activity, along with investors now discovering they can earn cash flow with 20% down on rentals in certain markets (Elk Grove, Natomas, and others, soon) is creating a great market for homes selling under about $350k. Many of these being REO (Bank Owned) Homes, and a good amount of short sale homes. Many homes are getting multiple offers and selling above list price.
This is great news, and this is a great first step, but we are still a little while away from the entire market recovering. With some many of these homes in the lower price ranges (say under $500k) being bank owned homes, the owners of those homes have already been evicted or vacated in some way, and probably are not in a position to buy a home. So, the REO purchase transaction does not trigger another purchase by the seller (who is a bank). Are market will begin to get healthy again once this REO inventory decreases significantly, and a majority of the transactions are individuals buying from other individuals, who in turn go buy something else, and the process repeats itself.
Sources indicate there is a large amount of foreclosed homes that have yet to hit the market. Places like El Dorado Hills, should still see a bunch of these homes come on the market this summer, which will probably drive prices even lower.
Bottom line, if you are entering the market, or looking to move up, have good credit and steady employment, it is great time to consider a move.
I am here to help if you need it.....
Thursday, May 22, 2008
Monday, January 14, 2008
More ARMs to reset in March...
Look for a whole new batch of homes to come on the market in the spring and summer after another large number of home owners see their adjustable rate mortgages go up. Many mortgages are due to reset in March of 2008, keep a lookout in some of Sacramento's middle to upper end communities where many stretched themselves to buy over that last few years.
Many experts are predicting some communities to get hit pretty hard this year, like El Dorado Hills. With bank owned properties selling for about 80 cents on the dollar compared to similar homes on the market this should drive prices down in these areas.
A quick check of www.realtytrac.com can give you a great idea of the # of homes in pre-foreclosure and are currently bank owned. Keeping an eye on this can give you a great idea of what is going on and about to happen by zip code.
If you would like a detailed analysis of any particular area, just let me know, I am glad to help.
Many experts are predicting some communities to get hit pretty hard this year, like El Dorado Hills. With bank owned properties selling for about 80 cents on the dollar compared to similar homes on the market this should drive prices down in these areas.
A quick check of www.realtytrac.com can give you a great idea of the # of homes in pre-foreclosure and are currently bank owned. Keeping an eye on this can give you a great idea of what is going on and about to happen by zip code.
If you would like a detailed analysis of any particular area, just let me know, I am glad to help.
Wednesday, October 10, 2007
Most Recent Real Estate Trends for Sacramento, Placer and El Dorado Counties
Included above are the latest statistics for the Placer, El Dorado and Sacramento Counties combined through the end of Sept 07.
The first graph is average price per square foot across the region and the second is total inventory vs. pending and sold properties.
Inventory for the three counties combines hit an all time high this summer in August, which many predicted it would with the number of distressed owners and bank foreclosures. Certain areas really skew these numbers as well, like Elk Grove, El Dorado Hills and Natomas.
Price per square foot is down 12.1% from 9/06 to 9/07 with the average price per foot going from $239 to $210 per foot.
If you would like these same statistics for you city, area or zip code, please let me know, I am happy to provide.
Friday, August 24, 2007
URL for Folsom Development Presentation
As mentioned in my previous post, here is the link for the Folsom Development Stuff:
http://www.folsom.ca.us/civica/filebank/blobdload.asp?BlobID=6682
Erik
http://www.folsom.ca.us/civica/filebank/blobdload.asp?BlobID=6682
Erik
Thursday, August 23, 2007
Current and Future Folsom Projects
Some very cool projects are underway in Folsom that should make life easier for most of us who live and/or work here.
Construction on the bridge being built just below the Folsom Dam is underway, and hopefully will be completed in 2008 or early 2009. The plan also shows a modified intersection at Natoma and Briggs Ranch drive, aimed at allowing proper traffic flow and decreasing the number of cars entering Briggs Ranch.
In the Historic Downtown district, a new parking garage is well underway. Initial plans had it being completed by the end of 2007. Slated for the near future is a complete renovation of Sutter Street starting from the new Folsom Lake Bank all the way through Riley St. to Scott St. The proposed redevelopment of the street and storefront area includes removing the median and current trees, making way for larger sidewalks, with many trees, and maintaining a two lane Sutter Street. The City and Historic District's goal is to 'beautify' the street and maximize the customer/patron experience with the increased walking access.
I will get the direct link to the city's website up in a future post.
Construction on the bridge being built just below the Folsom Dam is underway, and hopefully will be completed in 2008 or early 2009. The plan also shows a modified intersection at Natoma and Briggs Ranch drive, aimed at allowing proper traffic flow and decreasing the number of cars entering Briggs Ranch.
In the Historic Downtown district, a new parking garage is well underway. Initial plans had it being completed by the end of 2007. Slated for the near future is a complete renovation of Sutter Street starting from the new Folsom Lake Bank all the way through Riley St. to Scott St. The proposed redevelopment of the street and storefront area includes removing the median and current trees, making way for larger sidewalks, with many trees, and maintaining a two lane Sutter Street. The City and Historic District's goal is to 'beautify' the street and maximize the customer/patron experience with the increased walking access.
I will get the direct link to the city's website up in a future post.
What the heck has happened?
The real estate market has changed pretty dramatically in the Sacramento Region since mid 2005. A market that saw appreciation nearing and exceeding 20% a year for the 4-5 years preceeding, has sinced cooled, with prices adjusting downward, and in some neighborhoods, pretty dramatically.
Areas that had seen the largest growth from 2001-2005, especially those that included lots of new home construction, with inventory and open lots left in 2005 seem to be getting hit the worst. These areas include Natomas, Elk Grove, Rocklin and Roseville, and El Dorado Hills to name a few. With so many people purchasing in between 2001-2005, often times with very aggressive financing, and with builders still sitting on excess inventory they do not want to hold, prices have come down pretty significantly, 20-30% in some cases because of the amount of supply in inventory.
In addition, the Sacramento market had been influenced so greatly by an influx of investor money and equity rich buyers from the San Francisco Bay Area, that the median home price far outpaced what a median income here in Sacramento could afford. It was only a matter of time before that scenario contributed to an 'adjustment' in the market.
A large percentage of mortgages being issued to buyers over the last 4-5 years are adjustable rate loans, with many buyers having taken second mortgages at the time of purchase or at some time since, having run their debt ratio on their homes up to or near 100% are now finding themselves in trouble, and not being able to afford their mortgage, and also not being able to refinance, because the home will not appraise at a value high enough.
My advice to people in this situation: Make some lifestyle changes if at all possible. Cut back on your cable or satelite tv charges, cell phone usage, downsize your car, anything else you can do to save money elsewhere. Call your mortgage lender if you payments are more than you can afford and see if you can work something out.
If you have the savings to bring to the table, and refinance, then do it. It is money you should have probably put down originally, or money you took out on a second mortgage to buy a boat, car or something else.
If you simply cannot make payments any longer, talk to your lender immediately and explain the situation.
What does this mean for home buyers and sellers:
For sellers, it varies based on where you live. While the values have come down across the region, some communities have held up better than others. Folsom and Granite Bay, for example, along with the internal areas of Sacramento (Downtown, East Sacramento) with not a ton of new construction over the last couple of years, have held value fairly well. And regardless of where you live, the well maintained, nice homes still sell, pretty quickly if priced right. Pricing is the key. You don't want to be sitting in this market heading into the fall and winter, because I believe it will get worse (maybe much worse) before it gets better.
For buyers, patience is the key. With the number of homes available at an all time high in Sacramento, the options out there for you are many. New home builders are offering great incentives (landscaping, window coverings, even cars and boats in some cases!). Distressed sellers are offering homes at great prices, and/or willing to consider offers well below ask price or recent comparable sales. And, if you don't narrow yourself to a single home, there is a good chance of getting a bargain; if you narrow your choise to 3-4 homes, there is a good chance one of the sellers is willing to bargain.
New homes buyers: There are still some terrific programs for you, and the benefits of home ownership still apply in terms of tax savings, etc. Call or email me and I will introduce you to a lender who can help you today.
Areas that had seen the largest growth from 2001-2005, especially those that included lots of new home construction, with inventory and open lots left in 2005 seem to be getting hit the worst. These areas include Natomas, Elk Grove, Rocklin and Roseville, and El Dorado Hills to name a few. With so many people purchasing in between 2001-2005, often times with very aggressive financing, and with builders still sitting on excess inventory they do not want to hold, prices have come down pretty significantly, 20-30% in some cases because of the amount of supply in inventory.
In addition, the Sacramento market had been influenced so greatly by an influx of investor money and equity rich buyers from the San Francisco Bay Area, that the median home price far outpaced what a median income here in Sacramento could afford. It was only a matter of time before that scenario contributed to an 'adjustment' in the market.
A large percentage of mortgages being issued to buyers over the last 4-5 years are adjustable rate loans, with many buyers having taken second mortgages at the time of purchase or at some time since, having run their debt ratio on their homes up to or near 100% are now finding themselves in trouble, and not being able to afford their mortgage, and also not being able to refinance, because the home will not appraise at a value high enough.
My advice to people in this situation: Make some lifestyle changes if at all possible. Cut back on your cable or satelite tv charges, cell phone usage, downsize your car, anything else you can do to save money elsewhere. Call your mortgage lender if you payments are more than you can afford and see if you can work something out.
If you have the savings to bring to the table, and refinance, then do it. It is money you should have probably put down originally, or money you took out on a second mortgage to buy a boat, car or something else.
If you simply cannot make payments any longer, talk to your lender immediately and explain the situation.
What does this mean for home buyers and sellers:
For sellers, it varies based on where you live. While the values have come down across the region, some communities have held up better than others. Folsom and Granite Bay, for example, along with the internal areas of Sacramento (Downtown, East Sacramento) with not a ton of new construction over the last couple of years, have held value fairly well. And regardless of where you live, the well maintained, nice homes still sell, pretty quickly if priced right. Pricing is the key. You don't want to be sitting in this market heading into the fall and winter, because I believe it will get worse (maybe much worse) before it gets better.
For buyers, patience is the key. With the number of homes available at an all time high in Sacramento, the options out there for you are many. New home builders are offering great incentives (landscaping, window coverings, even cars and boats in some cases!). Distressed sellers are offering homes at great prices, and/or willing to consider offers well below ask price or recent comparable sales. And, if you don't narrow yourself to a single home, there is a good chance of getting a bargain; if you narrow your choise to 3-4 homes, there is a good chance one of the sellers is willing to bargain.
New homes buyers: There are still some terrific programs for you, and the benefits of home ownership still apply in terms of tax savings, etc. Call or email me and I will introduce you to a lender who can help you today.
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