The Sacramento numbers aren’t good way to spin it.

Thanks for your note. Was I spinning the numbers? I thought I was just publishing them.

Sure, the numbers are down from last year, but I’m not sure you can call the market “bad” yet, just normal. As someone remarked, “It’s not a bad market when there are nice homes to sell and single digit interest rates.”

Compared to 2002-2004, any kind of normal market is bound to look lackluster.

There. NOW I’ve spun the numbers.

Okay, Maybe that was harsh. I just thought you picked an interesting month to “zoom out.” The median price in Sacramento County is down 2%, in the past month, which you failed to mention.
There is also no mention of the 6433 home inventory for sacramento county, 2.5x that of last year. Thats a lot of scared people.
Asking prices have gone down 2% per month for the last 4 months. Some areas such as Placerville and Davis are seeing significant price reductions in the past month(more than ten percent). Percentages increases seem to be the only changes that realtors publish.
I’d appreciate some consistency, from the real estate industry as a whole, in the manor in which statistics are reported.

I look forward to participating in this blog ,but I will use an alias from now on. I would appreciate my name being removed from the previous post and replaced with “skeptical.”

Thanks, skeptical, for your note. I’ve gone ahead and changed the name on your first post as you’ve requested.

I’m gratified that someone’s actually reading my market data and that you took the time to respond.

You say I “failed to mention” that the median price is down 2% in the past month. Actually, it’s worse than that — I didn’t look it up. Now that I have, I do indeed see a dip in the median selling price of for all sold homes from August of 2005 to September of 2005, from $380,000 to $375,000.

I’m not sure what data you’re looking at, but I usually look at calendar month to calendar month data for properties that have actually sold (so “last month’s” data is usually as current as I get).

I don’t see a 2% difference in that data set, but I do see a 1.3 % drop. However, once adjusted for square footage in the monthly samples, the drop is .8% (8/10ths of a percent).

Well, anyway, perhaps we’re looking at different data and one might say that now that I’ve looked at it I’m quibbling, because either way prices are in fact going down in the short haul. Well, a lesson perhaps from your comments is that I should be looking at and reporting more month to month prices. I haven’t gotten into that more as yet because I don’t have a long history of dealing with seasonal fluctuations and didn’t want to suggest a trend that in fact might be partly seasonal. I only recently got my degree from Pundit University, so bear with me.

I have not yet found a method I like for looking at asking prices of active properties from month to month. Looking “active” from / to in our MLS software (Rappatoni), I do seem to see the short term decline you’re describing, but I also see two other problems with the data returned that lead me to suspect it.

As for the accusation “Percentage increases seem to be the only changes that realtors publish”, a few things. First and foremost, no one to date has read my blog and raised their hand to buy or sell a house through me, so to be accused of being disingenuous on a part of my web site that isn’t even really a profit center except in SEO terms is a bit of a stretch, I think. Secondly, I have been mainly publishing year to year numbers, and the price numbers have gone up during that time. Lastly, I have repeatedly published numbers that show both the strength of the market and its weaknesses. For example, I’ve shown inventory numbers as a monthly figure in more than a dozen reports so far for various communities, and I’ve shown how days on market has increased from year to year in almost all cases. (The only exception I’ve found to that rule so far was in the Bay Area, and I reported on it on my web site there). Also, I believe in some instances I’ve reported how the swing (difference between asking price and list price) has gone down.

No mention of the 6433 home inventory? Correct, because the number by itself is meaningless. At the end of the article I give the inventory in months. Is it 2.5 times what it was last year? How did you arrive at that?

6433, that’s “a lot of scared people”. Is it? Are they afraid they won’t make a killing on equity that they never really had until it came time to sell anyway? Afraid they can’t continue to price their homes $50,000 to $100,000 higher than any of the sold comparables and then write counter-offers to negotiate terms with buyers who write full price offers?

Last month 1998 homes sold in Sacramento County through the MLS, 1,232 of them (61.66%) within 30 days of being put on the market. The sellers of these are probably the same type of sellers whose homes sold within 15 days or less a year ago — people who showcased their homes for showing, had an agent who did a good job on the exposure and marketing side, and priced their home correctly for the market. I’m sure some of these are in the ranks of the 6433 as well, and they’ve nothing to fear, for their homes will sell quickly. Many of the others are trying to sell a five dollar bill for six dollars — yes, I suppose that’s cause for alarm, especially if you already spent that extra dollar.

Thanks again for participating! I know some of my “rebuttals” may seem a bit paranoid, but I really do appreciate the thinking you’ve gotten me to do about what numbers I publish. I’ll try to work some of that into what I write going forward, since it’s a fair criticism.

The data I used is from dqnews.com, Sacbees source. The month to month reduction is from $372,000-$365,000, a 1.88% reduction. The inventory was from golyon.com

From what I’ve gathered you do expect price declines. What kind of declines do you expect.

Excellent sources — I didn’t know dataquick had publically available data — I’ll have to check into that. I’m doing my work with our MLS system and some of the statistical reporting functions available there.

I believe the dataquick data is in some ways slightly more comprehensive, because it deals with all sales (including FSBOs) as opposed to just MLS sales, but it probably speaks to why we’re coming up with slightly different numbers.

As for predicting the size of future price decreases, short answer is, “I don’t know”. I’ll try to incorporate the long answer into a new post over the next day or two.

Cheers.

If you can I’d like you to address the following.

What price to income level do you feel sustainable?

What influence do you feel the large number of No Doc,I/O,or even simple ARMs will have?

Please don’t use any “expected Sacramento growth figures.”

Here’s a couple more topics.

Who are the major homebuilders in the area?

What are their holdings(lots owned or optioned)?

What is the minimum they can build for(per square foot)?

Do you have any info on:

The percentage of sellers who are empty nesters/baby boomers?

For the greater sacramentoarea the inventory/ population ratio is about equal to that of 1995, two years after the last peak. This being based on mls.

You mention the 6433 inventory level doesn’t mean much alone,the months of supply being the critical figure. Being that we are indeed at the cusp of this cycle, shouldn’t we expect dramatic increases from this point on?

How do you feel about David Lareahs recent comments.

http://originatortimes.com/content/templates/standard.aspx?articleid=1544&zoneid=1

Like I need to move on to new posts. Perhaps I’ll start doing some open threads if you want to get the discussion going. Thanks for posting them, though.