5 things that are increasing in the Sacramento real estate market

Real estate markets constantly change, so it’s important to watch them closely so we can adjust our business plan or prepare clients for what is happening or is coming. Here are 5 things that are increasing right now in the Sacramento market. Any thoughts or further insight? I’d love to hear your take in the comments below.

  1. Image purchased at 123rf dot com and used with permission - 14688774_s - smallerOpportunity: Buyers are gaining power since housing inventory has been increasing. More homes for sale has led to a slightly longer marketing period too, which also helps buyers have a greater selection as well as more power to negotiate. The local market had only one month of housing supply for a long stretch, but is now up to two months. The difference between only one month of housing supply and close to two months has been striking.
  2. FHA Uptick: If you didn’t know, FHA loans have seen a 3% increase over the past 75 days in Sacramento County. The increase has been 6% under $200,000 for the same time period.
  3. The Price is Right: We are in a market where sellers really need to price their properties correctly. For the most part it seems like sellers are starting to get in tune with the market beginning to shift (though certainly not always). It’s crucial to be “in the market” rather than “on the market” like Jay Papasan says.
  4. Real estate insight - image by Sacramento Appraisal BlogMore Owner Occupants: Having less cash purchases has helped create more opportunity for owner occupants to purchase in starter neighborhoods. There has been an 8% decline in cash purchases in Sacramento County over the past several months compared to the previous quarter (and a 10% decline when looking at all sales under $200,000).
  5. The Return of Closing Costs: As a real estate market gets more competitive it is common to see buyers begin to request a little something back from the sellers to help cover closing costs (particularly at the lower end of the sales spectrum). Requests for closing costs disappeared or felt irrelevant for quite a while when the market was insanely hot, but they will slowly creep back as the market “normalizes”. In fact, I have already been seeing quite a few requests for credits or closing costs in FHA deals and lower-end flipped properties.

The latest real estate market stats in Sacramento County:

real estate market trends in sacramento - cash - conventional - fha - by Sacramento Appraisal Blog

Question: What are you seeing happen in the market?

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Comments

    • says

      Thanks Ray. I appreciate your perspective. I think you’re right too that there is more opportunity, but it’s still not easy. In coming months I suspect it will become a bit easier. That’s what the trend seems to point toward anyway.

Trackbacks

  1. […] Fear & Market Trends: As investors gutted the market over the past year, FHA buyers really struggled as they lost about 10% of their market share. The truth is as cash came knocking on the door in mass, many sellers became leery of working with FHA buyers since cash was simply easier and generally came with fewer headaches. But now the tide is beginning to shift as inventory is on the rise, values have begun to cool off and investor cash has been on the decline. The stats alone tell us all we need to know since FHA has seen a 3% increase in Sacramento County over the past 90 days (and 6% under $200,000). […]

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