Category — Market Trends

What story does this graph of sales tell you? Let’s unpack the Meadowview area of South Sacramento for a moment as we look at sales over the past several years.

I’ve done a substantial amount of work in this neighborhood over the past few years for private appraisals, lenders and investors flipping houses. Overall there was a huge flood of foreclosures on the market in later 2008 as you can see with the dense sales at the bottom left side of the graph. As foreclosures were purchased and inventory decreased during that time period, the market began to improve a bit. The tax credit sure helped as you can see the impact of the tax credit from 11/07/2009 to 09/30/2010 as there was a greater stability during that time period. Its seems over the past year since the tax credit expired values have persisted to decline. Investors were selling standard 3/2 houses for $125,000 very easily a couple of years ago, but now flipped sales tend to range between $100,000 to $115,000 (for 1100-1200 sq ft). Lastly, the interesting thing about this neighborhood is that the graph above includes a newer portion of houses built over the past ten years and the bulk of other units built in the 1960s and 1970s. The newer houses in the larger newer subdivision tend to sell at the top of the market.

Any other insight or comments? I’d love to hear your input. If you invest in the neighborhood, why do you invest in Meadowview? If you live in the neighborhood, what is it you enjoy about Meadowview?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

What’s been happening at the top end of the real estate market in Sacramento County? As you can see in the graph below, there were 809 sales above one million dollars in Sacramento County over the past ten years since March 2002. It’s not much of a surprise, but there were far more million dollar sales before the “bubble” burst and there has been a clear trend downward in recent years too. In fact, the number of million dollar sales has been fairly thin over the past few years compared to earlier in the decade.

I condensed the graph above to include only sales under $2,500,000 and it helps show the trend more clearly. What do you see?

This bar graph shows how the 809 sales above were dispersed on the sales spectrum.

What challenges is the top of the market facing right now in the Sacramento area? Why are we seeing fewer sales above the one million dollar level?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Everyone and their mom has a solution to deal with the housing crisis, but ultimately programs and bailouts that only scrape the surface of the issue are not going to bring us back to “normal” until distressed inventory runs its course and employment in the Sacramento area begins to see significant improvement.

Short-term Market Boost: When I look at graphs like the one below, I’m reminded of what it looks like for a short-term program to enter the marketplace to help boost the economy. Ultimately, the tax credit from 11/07/2009 to 09/30/2010 had a positive impact on the market and surely saved some homes from foreclosure too. Yet the boost it gave to the housing market for a matter of months could not hold back the inevitable decline in property value though either. My point? Every day we seem to hear of new solutions to fix the housing market, but as painful as it is, the market may just need to bleed for a number of years ahead. As much as we’d like a quick fix or program, that’s probably not going to happen because we need time for the market to work itself out of the mess.

The graph below is based on research in the Churchill Downs neighborhood in Sacramento. I could plot out many areas of Sacramento and a very similar trend would be seen: stability during the tax credit and a decline afterward.

What do you think it looks like for recovery to unfold? Do you think we’ve hit bottom? Why are we not seeing a surge in property value right now in light of such low inventory levels?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Is the real estate market improving? While I’m not overly optimistic about the economy, it’s good to see a general trend throughout the market as seen in the table below. The percentage of foreclosures in the Sacramento area has seen a decrease over the past few years, while the level of short sales has seen an increase. Moreover, the overall percentage of distressed sales has seen a decline too.

What do you think this means?

The following graph was added as a result of a great question by Jeff in the comments section. “What were property values doing during this time?” was the question asked. It looks like the 95757 zip code has seen a clear decline in property value over the past three years. Yet at the same time it’s important to note the rate of decline has slowed down from previous years.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

I don’t make predictions about the real estate market, but I’m glad to report unemployment has been trending downward lately – and that’s a good thing!! It’s nice to see that arch on the right side of the graph getting a bit more defined as unemployment is currently at 2009 levels. If we see jobs increase in the Sacramento area, that can only be positive for the housing market, don’t you think?

How far have property values declined? Generally speaking, property values in Sacramento are at a level near 2001 right now. Some areas like Pocket / Greenhaven show a trend in 2002, whereas other zip codes in East Sacramento are closer to 2003, while still other zip codes or property types are definitely before 2001. Generally, the areas with higher values tend to sell near 2002 or maybe 2003 levels when considering the overall market median sales price by zip code. At the same time, many areas that we’d think of as “challenged” due to crime or other issues are definitely before 2001 in many cases. Keep in mind the median sales price by zip code encompasses an entire geographical area and may or may not represent a certain niche or neighborhood within that zip code (that’s the problem when looking at data for an entire area).

DOWNLOAD HERE: Sacramento Area Median Price Graphs for sales between 1997-2011 (PDF) from the Sacramento Association of Realtors. This may be helpful to glean some context into some of the aforementioned bits I mentioned above.

Any thoughts about unemployment or how the real estate market is doing?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Here’s a glimpse of what’s been going on in the duplex and fourplex real estate market in Sacramento County. Have a look at the graphs below and let me know what you see. There is quite span in price level of course because there is a big difference between areas such as Del Paso Heights, Land Park, Pocket/Greenhaven, South Sacramento, Midtown, etc… If you’ve been paying attention to the 2-4 unit market, what trends have you been seeing lately? If you are an investor, what price range and/or area do you target most often?

By the way, I have a few videos coming up in the next month or so with a local real estate investment specialist. The videos will highlight 2-4 unit trends in more detail. Be on the lookout.

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Don’t you love unique landmarks? I sure do. While driving on Wilton Road today on my way to an appraisal inspection, I decided to actually stop and snap a few pictures of this “cannon/mining” motif in the front of a property in Elk Grove (literally next to the border of Wilton). I always get a kick out of this one each time I pass by. My lot size is far too small to have this theme in my yard. Well, my neighbors would probably flog me too due to the principle of conformity in real estate. But if I was on acreage…. What do you think?

While we’re on the subject of Wilton, here are all sales in Wilton over the past five years. What do you see? Does anything stand out to you? The trend in many other areas of Sacramento tends to have a much sharper decline, but that’s less of the case here. What makes Wilton different in your mind? If you live in Wilton, what do you find desirable about the community?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

How is the real estate market doing in the Greater Sacramento Area? Let’s feel out one aspect of the market’s health today by looking at the level of distressed sales in multiple counties such as Sacramento, Placer, Yolo, El Dorado, San Joaquin and more. As you can see in the chart below, most counties in the Sacramento Region have a combined percentage of distressed sales (bank-owned and short sales) between 60-70%. Does it shock you to think that 6 to 7 out of every 10 sales are distressed? Data within a specific neighborhood or city may of course not reflect the trends listed in an overall given county (as in the clear case of the City of Davis in Yolo County), but the countywide panoramic picture is still important to keep in mind when keeping tabs on market health since regional or countywide trends can tend to impact smaller neighborhood markets over time.

What stands out to you about the figures below?

If you have any questions or Sacramento area real estate appraisal or property tax appeal needs, contact me by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Do you remember how hot the market felt when the first-time homebuyer tax credit hit the streets? If you recall, the tax credit went into effect from November 7, 2009 to April 30, 2010 (but then the deadline was extended to September 30, 2010 – but you had to be in contract by 4/30/10).

I just finished up an appraisal in North Highlands and I know the market really well in this particular neighborhood. I’ve been doing appraisals consistently over the past few years in a particular tract for an investor, so I’ve watched the market decline, seemingly stabilize during the tax credit season, and then decline again. The image below includes all of North Highlands as an example of the impact the tax credit appears to have had. There was an uptick in sales and the decline in property value seemed to stop while the credit was alive.

Now that the credit has been expired for over a year, how would you say it impacted the real estate market? Do you see this trend below in other neighborhoods or maybe just in markets under $200,000? What were the positives and negatives of the credit?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

Just because a model match sells at a certain level does not necessarily mean it’s a good comp, right? Obviously model match sales are great for comparison because they have the same layout, but there are so many factors  why model matches do not always sell at a similar level. This point is particularly evident in the graph below of all MODEL MATCH sales in the Lincoln Crossing neighborhood. Isn’t it amazing to see nearly a 25% difference in price level for the same floor plan?

Here are my observations:

1. There is a vast range of prices among model match sales.
2. The neighborhood has seen a decline in value over time.
3. The range of sales is about $85,000. This range has been seen more or less over the past few years, which is important to note.
4. The sales at the top tend to back the greenbelt and have premium upgrades, while the ones at the bottom tend to be short sales. In this neighborhood short sales are tending to sell for less than foreclosures (for this model anyway).
5. The appraiser could botch the value if simply using model match short sales as “comps” while ignoring traditional sales at the top. At the same time, there could be money left on the table if the property is marketed against the lowest sales in the neighborhood. Also, the home owner could use all the wrong comps in a tax appeal too, right? This brings up the importance of working with local professionals and sifting through bank-owned, short sales and traditional sales to establish market value.
6. Having such a large range of sales means it may prove challenging for online valuation websites like Zillow and Cyberhomes to render a credible value. Granted, a reliable value is not always easy for human appraisers either to be fair, but actually seeing the property and understanding the market makes all the difference.

What stands out to you about the graph? What scenarios have you seen cause a huge difference in price among model match sales?

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

This is a great example of what happens when a home owner purchases a property, the real estate market has a major shift, and the home owner does not pay attention to property taxes. This is a real scenario and unfortunately it’s all too common.

I just finished a tax appeal report for a home owner in Fair Oaks. His property is assessed at $281,873 and has been assessed at that level for the past three years. He originally purchased the property in 2003 for $292,000. All things considered, after a detailed analysis, market value on January 1 was actually $150,000, which is $130,000 less than the assessed value. This means the owner was scheduled to overpay by $1,648 this year (he easily overpaid these past two years also by $2,500).

Life is full and there are so many things to stay on top of, so it’s understandable to not pay attention to property taxes. However, think in terms of the exodus of greenbacks from your wallet that should be staying comfortable in your pocket. This home owner easily overpaid $2,500 over the past two years and was scheduled to overpay another $1,648 this year had he not contacted me. How does giving the county $4,000 of YOUR money sound to you?

Remember the deadline to dispute property taxes in Sacramento County is November 30, 2011. Contact me and I’ll be glad to explain how the process works and take a preliminary free look into your property to give a professional eye to your situation. By the way, you can look up your property HERE to see how the county has assesed you (your value should be based on January 1). The tax appeal world often feels like foreign territory for many home owners, so let me at least give you insight into what to do and how to do it. I typically charge $99 for a very solid appeal report that includes multiple trend graphs of your neighborhood, a market analysis, the best comps and the worst comps too if need be. You should only hire me or someone like me if there is a savings to be had though. Don’t waste your money on a report that is not needed. Whatever you do, pay attention.

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.

This graph illustrates perfectly why it’s important for some home owners to dispute their property taxes. Can you see how the Assessor’s value is truly a “lone ranger” among similar sales? A Sacramento area investor contacted me to prepare an appeal report for him to demonstrate market value on January 1 (date of assessment). As you can see, there is an enormous difference between assessed value at $167,154 and market value at $95,000 in the case of this halfplex in Citrus Heights. The savings in taxes per year equals $901, which works out to $75 per month. What would you do with an extra $75 each month in your pocket? (money that should be there in the first place)

If you have any questions, or real estate appraisal or property tax appeal needs in the Greater Sacramento Region, contact Lundquist Appraisal by phone 916-595-3735, email, Facebook, Twitter or subscribe to posts by email.