If you’re looking to stay on top of the Sacramento real estate market, here are a few tidbits to check out. I hope this helps give you a sense of what is happening. If you have any questions or insight, feel free to comment below.
1) The Market is Flattening Out: Realtor Doug Reynolds posted a video two days ago about how the market in Sacramento has been flattening out. This is right in line with the way I’ve been describing things. It’s important to watch trends closely so we are empowered to employ the best strategies for business and be on top of our game for clients. This is worth a watch or listen below (or here).
It’s normal in real estate to see the market slow down in Fall and then heat up again in Spring. The only issue is that some locals are shocked to hear this since they have only heard the market is “on fire” or that values have increased by 30%. But when we take a closer look, the trend has shifted. We’re now in a new market, so let’s keep an eye on the past, but focus on the present and future.
2) The Word on Unemployment: If you didn’t catch the recent news, the unemployment rate in Sacramento County is now 8.9% as of August 2013. It’s been hovering around 9.0% for a few months now, while the unemployment rate in California is currently 8.8% and it’s 7.3% in the United States.
Here’s my take on the interaction of jobs with real estate. The recent upward trend in values was very strongly influenced by forces external to the Sacramento market as opposed to our local economy. Now that interest rates are increasing and some investors have begun to exit the market (down nearly 8% over the past few months), the job market will stand out a bit more now that we are missing some of the outside power that gave the market a boost. Remember, there are many factors that impact real estate values, and jobs is just one of the “layers of the cake” so to speak.
3) Forty Pages to Explain the Market: This is the most exhaustive report I know of in Sacramento. It’s worth printing and reading in the bathroom (or wherever you do your reading) to help gain some context for what is influencing the local market. If you want to go green, just download and read it on your tablet or computer. It is 40 pages in length, so it’s not a quick blog style read (many of the pages are graphs). I contributed a page or two to this report as well as some charts, which is always an honor. Visit Joel Wright’s website or DOWNLOAD HERE (PDF).
Question: What are you seeing happening in the market?
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I inspected two fixer REOs this week and those were the first I’ve seen in a looong time so it seems REOs will back in action again.
Got an email offering a 70% stated-income loan for investment properties so those type loans are coming back in action again too (7.99% interest rate.)
Plus they’ve loosened the loan requirements regarding the homeowners’ wait-time since a short sale or foreclosure due to job loss or work slowdown – it’s only a year now, not 2-7 years like they first said.
So I anticipate the gears are in motion working to bring the hot market back around again and that things will change soon…and already people are near-close to camping out for new homes.
Interesting to hear. Since REOs have only been about 5% of the market, there is certainly room for them to increase. Keep me posted if you end up doing more REOs. Years ago the bulk of my work was appraising REOs from an asset manager. Now this same client sends me mostly appraisals that are in the process of a short sale. We’ll see where the market goes. Stated income is a bad idea. 🙂 Thanks Anne.