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.
- Opportunity: 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.
- 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.
- 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.
- More 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).
- 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:
Question: What are you seeing happen in the market?