Archive for 2010

Carmichael Real Estate Market Update: July 2010

As Sacramento home owners wait for a recovery, even a leveling off seems like good news lately. And if you own a home in Carmichael, you should be breathing a sigh of relief. We’re of course not over the real estate slump yet, but there seems to be some sort of end in sight, at least locally. Everything could change if the market does not absorb the short sales currently listed, but at least for now it seems like the long road to recovery has begun, even though it might be uphill.

53 homes sold this last month in Carmichael, almost the same number as last July when 55 homes had sold – that’s a unit volume drop of 3.6% year over year. Foreclosure sales fell 38% while the number of short sales doubled. Non-distressed sales remained almost the same. 64% of all homes sold are now non-distressed as compared with just 56% last year at this time.

Average price per square foot is now $171.24 – an increase year over year of 6.8%. Last July, it was $160.38. Average sales price rose 21.9% year over year – however homebuyers also bought homes on average 14% bigger, so keep in mind that the average price per square foot is the more accurate figure here. Average sales price in Carmichael is currently $339,313. Median sales price rose 14.2% and currently rests at $265,000.

Inventory in Carmichael is currently at 5.1 months.

Land Park Real Estate Market Update: July 2010

Most homebuyers will agree that Land Park is a real estate market all unto its own. It does follow the general trend of Sacramento county but it is unique in its reluctance to absorb short sales month after month, year after year. This July, the decline in sales has been quite drastic and not just including short sales.

Real estate property sales dipped 51.9% in Land Park, with foreclosures dropping 75% and non-distressed sales falling 47.8% year over year. No short sales sold, as with last July. Overall, just 13 homes closed escrow – 12 non-distressed and 1 foreclosure sale.

Average sold price per square foot remained amazingly level. Currently $251.39 it fell just 2.3% year over year from a high of $257.41. Homebuyers however picked out bigger homes and bought on average homes 18% larger this July than they had last July. This affected average sales price which rose 15.3% year over year from $384,867 to $443,615. The more accurate figure here is of course the average price per square foot. Median sales price also rose this month, albeit at a smaller percentage of 8.1% from $370,000 to rest at $400,000.

Land Park currently has 8.2 months of inventory based on the last year of sales.

Federal Reserve Announces Final Rules for Mortgage Borrowers’ Protection

The Federal Reserve Board announced final rules to protect homebuyers needing mortgages to be able to purchase a house from unfair, abusive, or deceptive lending practices that can arise from loan originator compensation practices. These newly released rules apply to mortgage brokers and the companies that employ them, as well as mortgage loan officers employed by depository institutions and other lenders.

Today, lenders commonly pay loan originators more compensation if the borrower accepts an interest rate higher than the rate required by the lender (referred to as a “yield spread premium”). Under the new rule, the loan originator is not allowed to receive any payment that is based on the interest rate or other loan terms. This will prevent loan originators from increasing their own compensation by raising the consumers’ loan costs, such as by increasing the interest rate or points. However, loan originators can continue to receive compensation that is based on a percentage of the loan amount, which is a common practice.

The new rule also prohibits a loan originator that receives compensation directly from the consumer from also receiving compensation from the lender or another party. In consumer testing, the Board found that consumers generally are not aware of the payments lenders make to loan originators and how those payments can affect the consumer’s total loan cost. The new rule seeks to ensure that consumers who agree to pay the originator directly do not also pay the originator indirectly through a higher interest rate, thereby paying more in total compensation than they realize.

Additionally, the final rule prohibits loan originators from directing or “steering” a consumer to accept a mortgage loan that is not in the consumer’s interest in order to increase the originator’s compensation. The rule will preserve consumer choice by ensuring that consumers can choose from loan options that include the loan with the lowest rate and the loan with the least amount of points and origination fees, rather than the loans that maximize the originator’s compensation.

The final rules are effective April 1, 2011. You can find the entire Final Rules Highlights Document here.

Antelope Real Estate Market Update: July 2010

The last time we looked at the real estate market in Antelope in April of this year, the market didn’t look much different from this month. 59 homes have sold in the month of July, an overall unit volume decline of 21.3% year over year. Foreclosure sales alone fell 28.6%. There have been falling sales in all categories we track including short sales (which fell 5.9%) and non-distressed sales as well (which fell 18.8%) year over year.

The overall ratio of distressed sales to non-distressed has not change dramatically year over year. Approximately 4 out of 5 homes sold continue to be distress sales in the area of Antelope, the zip code of 95843 in Sacramento county.

Average sold price per square foot is now $111.14 which is 4.5% lower than it was a year ago. Last July, it was at a high of $116.43. Average sales price has risen since we last took a a look at Antelope. However, it is still 3.5% lower than it was last July when it was $202,764. Currently, it is $195,621. Median sales price rose 1.5% for the same period from $197,100 to a high of $200,000.

Inventory has fallen since we last looked to 4.3 months based on the last year of sales.

Elk Grove Real Estate Market Update: July 2010

219 homes sold in the city of Elk Grove this last month, an overall unit volume decrease of 17% year over year. Foreclosure sales alone fell 41% while non-distressed sales declined 8.2% year over year making this one of the slowest years in real estate sales. Short sales in Elk Grove increased however by 31.5% which means that 1 out of every 3 homes sold in Elk Grove is now a short sale – quite impressive if you consider how home buyers were not interested in short sales a little while ago. Sales seem equally divided between foreclosures, short sales and non-distressed homes.

Average price per square foot declined slightly this month from $115.55 last July to rest at $111.82. That’s a 3.2% decline year over year. Average sales price is now $232,070 – a 5% decrease for the same period from a high of $244,430. Median sales price remained mostly unchanged at $228,800. Last July it was $229,500.

Overall inventory in Elk Grove is stable at 3.2 months with foreclosure inventory at half a month.

Folsom Real Estate Market Update: July 2010

Sales volume in Folsom as elsewhere in Sacramento county has dropped considerably. It might be safe to call this year the slowest year in real estate since we started tracking numbers. Overall unit volume declined 31.6% year over year with sales dropping from 76 last July to just 52 homes sold this July. Foreclosure sales and non-distressed properties both dropped – the former fell by 52% while the latter by 29.5% year over year. Short sales increased by a small number – 2 more short sales this July over last July. Almost 3 out of every 5 homes currently sold are now non-distressed sales.

Average sold price per square foot in Folsom declined 6% year over year. From a high of $176.48 last July, it now rests at $166.08 this July. Average sales price fell 4% correspondingly to rest at $350,840 from a high of $365,587. Median sales price is now $351,450. Last July it was almost the same at $355,500.

Inventory in Folsom is around 4 months. Foreclosure inventory is around 1 month. Short sale inventory is the largest at right around 9 months.

El Dorado County Real Estate Market Update: July 2010

163 homes sold in the county of El Dorado this last month, an overall unit volume decrease of 12.8% year over year. The largest decrease was in the category of foreclosure sales where home sales dropped from 69 last july to just 42 this july. That was a decline of 39.1% year over year. Short sales increased by 7.7% while non-distressed sales dropped 1% for the same period.

Average sold price per square foot remained mostly unchanged year over year. It is currently $153.30 which is a 0.4% drop from $153.88 last July. We see the same trend here in El Dorado county that we are seeing all over Sacramento county – price stability and much lower sales volume. Average sales price also remained stable at $357,877. Median sales price dropped 5.3% from $337,750 to rest at $319,777.

Inventory in El Dorado county is at 8.9 months based on the last year of sales and 8.1 months based on the last six months of sales. Foreclosure inventory is at a little under three months.

Sacramento County Real Estate Update: July 2010

If you’re not really interested in real estate and market updates right now, you are in the majority. Definitely a large number of people have lost interest in real estate, including, it seems homebuyers.

Overall unit volume dropped 23.9% year over year in Sacramento county. 1433 homes sold this July over 1883 last July. Foreclosure sales fell 40.4% while non-distressed sales dropped 15.3% for the same period. Short sales on the other hand rose 10% year over year, but not enough to make up for the downward push on home sales.

Prices seem to have stabilized – at least for now. Average sold price per square foot is now $122.47, which is 1.3% higher than it was last July when it was $120.93. Average sales price rose 4.4% in Sacramento county up from $196,323 to rest at $204,995. Median sales price remained unchanged year over year at $175,000.

Inventory in Sacramento county is currently at 4.5 months. Foreclosure inventory is at 1.4 months.

Condo Sellers – Put Condo on FHA List

If you are the seller of a condo unit, you should be aware of the list of condo associations on the approved list for an FHA mortgage loan. You should also do your best to add your association to that list. Individual condos do not go on there – only the entire association does. Even if you are not selling your condo but just refinancing it, it is important you do the same.

This is important to do because a third of all mortgages today are backed by the FHA. Compare this with only 3% of all mortgages three years ago which were FHA-insured. So chances are good that if you bought a condo three years ago, it was not on the FHA=approved list. If you don’t get it added today, you’re missing on a major chunk of homebuyers that would be potentially interested in purchasing your home due to lack of financing. In this painfully slow real estate market, I doubt any seller can afford that.

You can check the information site http://www.CheckFHAApproval.com to see if your association is already approved.

Rosemont Real Estate Market Update: June 2010

62 homes sold in the area of Rosemont this past month, an overall unit volume increase of 19.2% year over year. Unlike elsewhere in Sacramento county where foreclosure sales have been falling, Rosemont shows an increase in foreclosure sales year over year – an increase of 38.1% to be exact. Short sales remained largely unchanged year over year as well as non-distressed sales. Roughly 1 out of every 3 homes sold is a non-distressed sale.

Average price per square foot increased by 1% year over year, another indicator that the real estate market might finally be leveling off. Average price per square foot is currently $120.42 up from $119.19 last June. Average sales price rose 3% for the same period from $164,227 last June to rest at $169,101. Median sales price dropped a little – 3.5% from $171,050 to $165,000.

Inventory in Rosemont is currently at 5.5 months (based on the last year of sales). Foreclosure inventory is currently at 3.1 months while short sale inventory remains high at 14.3 months. Nondistressed inventory is at 3.3 months.

Greenhaven Real Estate Market Update: June 2010

Well, well, well… it’s been a while since we looked at the real estate market in the Greenhaven or Pocket Area as it is sometimes referred to around here. This is the 95831 area code and during the happy real estate times, it was hard to find a house here that stayed on the market longer than a few days without multiple offers. Today the scenario looks quite a bit different but not hopeless.

Volume has not changed much year over year. 32 homes sold this June – almost the same as 31 last June. Foreclosure sales have fallen 33.3% while short sales have increased somewhat. Non-distressed home sales also remained almost the same – a 10.5% increase year over year. 65.6% of all homes sold in the pocket area are now non-distressed sales.

Average price per square foot rose slightly from $165.88 last June to rest at $167.71 this June. Homebuyers however bought homes markedly larger than they did last year. The average square footage of homes sold was 12.6% more year over year. Average sales price rose accordingly from $289,644 to $329,747 – a 13.8% increase. However, the more accurate number in terms of prices is the average sold price per square foot. Median sales price has also risen 11.2% from $272,000 to $302,500.

Inventory in Greenhaven is at 6.3 months.

New Guidelines for Home Appraisals

Having just met a friend who went through the maddening scenario of an appraisal coming in too low, the feeling is still fresh in my mind. But on the heels of consumers complaining of artificially increased appraisals of homes now comes the opposite – house valuations are coming in too low. The typical scenario goes like this: a home is in escrow, agreements signed and then during the transaction, an appraisal is conducted and it comes back about $50,000 lower than the agreed-upon price. Now, keep in mind that the asking price is usually not arbitrary. Gone are the days when home sellers inflated their home because “it simply must be $10,000 higher than their neighbor’s house!” Today, asking prices are decided by bank-owned homes selling as comparables in the same neighborhood. So when an appraisal comes in that low, everyone is distraught. Sometimes the transaction falls apart.

However, this industry practice may soon change. In guidelines issued on June 30, 2010 Fannie Mae said lenders must contact appraisers to resolve discrepancies between the valuations, rather than simply reducing the appraisal. If it is not possible to contact the appraiser, the lender should order a second appraisal. Borrowers and/or sellers who believe a home valuation is too low may appeal the valuation or request a second option. It’s important to note that the second valuation must be more than five percent higher than the first—anything less is considered an acceptable difference.

Also, effective Sept. 1, Fannie Mae is prohibiting the purchase of loans from lenders who change appraisers’ numbers.

East Sacramento Real Estate Market Update: June 2010

Homebuyers didn’t seem as interested in buying houses in East Sacramento this month as they usually are. Just 28 homes sold in the entire month of June in the area as compared with 41 a year ago. That’s a unit volume decrease of 31.7% year over year. Foreclosures alone fell 66.7% year over year in sales followed by non-distressed sales which fell 22.2% for the same period. Short sales remained mostly unchanged in number as last June – 3 this June as compared with 2 the last.

Average price per square foot is now $230.61, which is now up 7.1% year over year from $215.40. Homebuyers still preferred houses on average 2.5%. However, average sales price remained above the $300,000 mark at $301,693. That was an overall increase year over year of 4.4% from $289,099. Median sales price is currently $291,000 down 6.1% for the same period from the high of $310,000.

Inventory in East Sacramento is at 5 and a half months. Foreclosure inventory still hovers around 2 months.

Fair Oaks Real Estate Market Update: June 2010

39 homes sold in all in the city of Fair Oaks in June 2010. That number was an overall unit volume increase of 18.2% year over year. Of the 39 homes, 11 were foreclosure sales, 9 were short sales and 19 were non-distressed homes. Overall, it seems as if the market is relatively unchanged from last June. Roughly 1 out of 2 sold homes is not distressed. The increase in unit volume was evenly dispersed over all three categories we track.

Average price per square foot is currently $155.92 which is on overall drop of 4.8% year over year. Average sales price fell 6.9% from a high of $288,042 last June to rest at $268,253. Median sales price also fell but not very far from $241,000 to currently $237,000. That is a drop of 1.7% year over year. Home buyers also preferred houses on average 2.2% smaller this June over last June.

Inventory in Fair Oaks is at 5.8 months based on the last year of sales and 6.1 months based on the last six months of sales. Foreclosure inventory is at 1.2 months no matter how you look at it.

Home Buying Applications Lowest in 13 Years

Homebuyers seem to be uninterested in buying homes lately or so says the Mortgage Bankers Association. Of course, we all know people personally buying or looking for a house to buy but mortgage applications have fallen to a thirteen year low. The Association claims that the last time volume was so low was back in July of 1996.

Most of the homebuyers seem to be taking a break after the deadline for the tax credit passed so it may be that anyone who was considering buying a home this year definitely pushed for the tax credit which ended April 31st., 2010. The deadline for closing on a home purchase transaction which is already in escrow by April 31, 2010 has now been pushed to September 2010.

Mortgage rates for a 30 year fixed hover around 4.5% this week.

Carmichael Real Estate Market Update: June 2010

This month we saw an increase in unit volume sales in the city of Carmichael. 52 homes sold in the month of June – an increase year over year in real estate sales by 18.2%. Foreclosure sales remained at almost the same number, which is an oddity in a county where elsewhere foreclosure sales are falling at a rapid rate. Short sales more than doubled year over year while non-distressed sales fell 21% for the same period. Overall, home buyers seem to be gravitating towards short sales more than non-distressed homes or foreclosure sales. 1 out of 3 homes sold today is non-distressed.

Average price per square foot is now $152.92 which is 1.2% lower than it was a year ago when it was $154.82. Home buyers also seemed drawn to smaller homes – the average sold home in Carmichael this month was 7.5% smaller than it was a year ago. Average sales price is currently $257,227 which is 8.7% lower year over year from a high of $281,637. However, keep in mind that the more accurate figure here is the average price per square foot. Median sales price fell 10.9% year over year from $248,450 to $221,250.

Real estate inventory in Carmichael is currently at 5 and a half months.

El Dorado County Real Estate Market Update: June 2010

196 homes closed escrow in the month of June in El Dorado county. While parts of Sacramento county are beginning to level off and even have some price gains, El Dorado county is lagging behind in this area.

196 homes selling was an overall unit volume increase year over year from 176 home sales last June in the area of 11.4%. Foreclosure sales increased slightly t 8.2% and short sales gained a whopping 114.3% year over year. Non-distressed sales continued to fall by 9.6%. In fact, non-distressed sales now make up 43.4% of all sales while last year they made up 53.4% of all real estate sales.

Average price per square foot is now $151.80 which is a 4% decline year over year from a high of $158.16. Average sales price in El Dorado county for a house is $365,469 down 3.4% from a high of $378,291 last June. Median sales price is now $335,000 down slightly (1.5%) from $340,000 last June.

Inventory in El Dorado county is now at 8.7 months based on the last 12 months of sales and 8.4 months based on the last six months of sales. Foreclosure inventory is at 2.6 months.

Elk Grove Real Estate Market Update: June 2010

The Elk Grove real estate market, following the trend of the larger Sacramento county real estate market as well as other local smaller markets, is mostly unchanged from last year about this time. 283 homes sold in Elk Grove in the month of June, over 280 in June of 2009. However, foreclosure sales fell 27.7% while short sales gained 25% in sales. Non-distressed home sales rose the highest in Elk Grove at 52.8% year over year.

Average price per square foot continued to stabilize and currently rests at $114.93 up 2.3% year over year from $112.38. Home buyers bought homes on average 2.7% larger this year than in last June. Average sales price reflects this slight increase in the size of homes bought and sold and is 5.1% higher than it was a year ago. Average sales price now is $248,063. Last June it was $236,078. Median sales price is currently $235,000 which is 2.2% higher than a year ago when it was $230,000.

Overall inventory in Elk Grove is at 3.5 months, foreclosure inventory is less than 1 month while short sale inventory hovers around 10 months.

Folsom Real Estate Market Update: June 2010

Home buyer interest in real estate in the city of Folsom continues to peak with 81 homes sold overall this month. That is a unit volume increase of 19% year over year from just 68 homes selling last June. Foreclosure sales fell 19% year over year while short sales increased 41.7% for the same period. Non-distressed property sales also increased – albeit at a lower pace – 27.5% year over year. Currently, 63% of all homes sold are non-distressed as compared with 58.8% last year at this time.

Average price per square foot is now $169.44 which is a 3.2% decline year over year from a high of $175.02. Interestingly, home buyers also bought homes exactly 3.2% larger this year than they had last year at this time, leaving average home prices almost the same at $357,318 in Folsom. Last June, the price for an average sized home in Folsom was $357,483. Median sales price however has fallen again to $341,500 – that’s a 7.1% decline year over year from $367,500.

Inventory in Folsom is at 4.3 months.

Sacramento County Real Estate Market Update: June 2010

The Sacramento county real estate market is exactly where it was a year ago! How’s that for stability? (I mean that a little tongue-in-cheek, of course.) 1853 homes sold this June – almost the same number as last June. However, foreclosure sales fell 33% while short sales increases 62.3% and non-distressed sales increased 26% year over year. 37.4% of all sales are now non-distressed homes, a better number than last June when 29.7% of all solds were non-distressed.

Average price per square foot has now risen by 2.9% year over year. It is currently $123.96 from $120.49 a year ago. Average sales price currently sits at $208,360 up 5.9% from $196,672 last June. Median sales price has also increased 5.7% to rest at $185,000 from $175,000 last June. Home buyers afforded themselves houses on average 3% larger this June than June 2009.

Overall inventory in Sacramento county is currently at 4.5 months, foreclosure inventory is at 1.3 months. Short sale inventory remains at pretty high levels at just under a year at 11.7 months.

Considering Buying a Home this Summer?

If one of your financial goals this summer is to buy a home (and you’re tired of me talking all the time here) you should make it a priority to go to the official Fannie Mae website. If you are a first time homebuyer, this is especially helpful to you, full of information beginning at the basics of home purchasing. If you’re a current homeowner and considering a home refinance, you might want to head over there anyway to protect yourself from loan modification scams.

Whatever your goal, make sure you do your research and homework regarding a purchase. If you have started searching online and have a general idea of what you would like to buy but don’t know what payments you might be comfortable with, we can put you in touch with mortgage professionals. Give us a call!

Top Credit No-Nos During a Home Purchase

An associate sent me this in my email and I think it’s important that every home buyer know these top ten no-nos when it comes to their credit during the home buying period. I had earlier shared that Fannie Mae has adopted a new loan initiative to ensure that only qualified borrowers receive mortgages, a post that may be worth reading again. And if you’re in the process of buying a home or in escrow, remember these top ten no-nos.

1. DON’T DO ANYTHING THAT WILL CAUSE A RED FLAG TO BE RAISED BY THE SCORING SYSTEM. This would include adding new accounts, co-signing on a loan, changing your name or address with the bureaus. The less activity on your reports during the loan process, the better.

2. DON’T APPLY FOR NEW CREDIT OF ANY KIND. Including those “You have been pre-approved” credit card invitations that you receive in the mail or online. Every time that you have your credit pulled by a potential creditor or lender, you lose points from your credit score immediately. Depending on the elements in your current credit report, you could lose anywhere from one to 20 points for one hard inquiry.

3. DON’T PAY OFF COLLECTIONS OR CHARGE OFFS during the loan process. Unless you can negotiate a delete letter, paying collections will decrease the credit score immediately due to the date of last activity becoming recent. If you want to pay off old accounts, do it through escrow – at closing.

4. DON’T MAX OUT OR OVER CHARGE ON YOUR CREDIT CARD ACCOUNTS. This is the fastest way to bring your scores down 50-100 points immediately. Try to keep your credit card balances below 30% of their available limit at ALL times during the loan process. If you decide to pay down balances, do it across the board. Meaning, pay balances to bring your balance to limit ratio to the same level on each card (i.e. all to 30% of the limit, or all to 40% etc.)

5. DON’T CONSOLIDATE YOUR DEBT ONTO 1 OR 2 CREDIT CARDS. It seems like it would be the smart thing to do, however, when you consolidate all of your debt onto one card, it appears that you are maxed out on that card, and the system will penalize you as mentioned above in 4. If you want to save money on credit card interest rates, wait until after closing.

6. DON’T CLOSE CREDIT CARD ACCOUNTS. If you close a credit card account, you will lose available credit, and it will appear to the FICO that your debt ratio has gone up. Also, closing a card will affect other factors in the score such as length of credit history. If you HAVE to close a credit card account, do it after closing.

7. DON’T PAY LATE. Stay current on existing accounts. Under the new FICO scoring model, one 30-day late can cost you anywhere from 50-100 points, and points lost for late pays take several months if not years to recover.

8. DON’T ALLOW ANY ACCOUNTS TO RUN PAST DUE — EVEN 1 DAY! Most cards offer a grace period, however, what they don’t tell you is that once the due date passes, that account will show a past due amount on your credit report. Past due balances can also drop scores by 50+ points.

9. DON’T DISPUTE ANYTHING ON YOUR CREDIT REPORT once the loan process has started. When you send a letter of dispute to the credit reporting agencies, a note is put onto your credit report, and when the underwriter notices items in dispute, in many instances, they will not process the loan until the note is removed and new credit scores are pulled. Why? Because in some instances, credit scoring software will not consider items in dispute in the credit score – giving false data to the lender.

10. DON’T LOSE CONTACT WITH YOUR MORTGAGE & REAL ESTATE PROFESSIONALS. If you have a question about whether or not you should take a specific action that you believe may affect your credit reports or scores during the loan process, your mortgage or real estate professional may be able to supply you with the resources you need to avoid making mistakes that could drop your credit scores or possibly, cause you to lose the loan.

East Sacramento Real Estate Market Update: May 2010

It’s been a while since we took a look at our favorite real estate market – East Sacramento. The last time we took a look in the month of February the market was busy on its road to some sort of stability and recovery. I’m happy to report that it seems fairly stable and recovering still.

46 homes sold in this last month, an overall unit volume decline of 11.5% year over year. Foreclosure sales alone fell 62% for the same period while short sales and non-distressed property received buyer interest to rise 60% and 15.4% respectively year over year. 65.2% of all sales are now non-distressed up from just 50% of all sales last May.

Average price per square foot has risen to $232.13 – up 6.8% year over year from a low of $217.45. Average sales price has also gone up from $288,529 to $303,203. That’s a rise of 8.1% since last May. Median sales price has jumped 19% in the same period from $250,000 to $297,450.

Real estate inventory in East Sacramento is now at 4.6 months based on the last year of sales and 5.1 months based on the last six months of sales.

Fair Oaks Real Estate Market Update: May 2010

The Fair Oaks real estate market continues in its painfully slow steadying. 31 homes sold this month, an overall decline of 24% in unit volume from a year ago when 41 homes had sold that May. Foreclosures alone declined 50% year over year and even non-distressed sales didn’t get as many homebuyers as they did a year ago. Non-distressed home sales declined 10% for the same period. Short sales remained the same at 6 total sales – the same as last May.

Average price per square foot remained almost unchanged at $146.44 – a decline of 0.3% year over year. Average sales price rose by 4.1% year over year from $278,519 to rest at $289,848. Median sales price in the meanwhile fell from $285,000 last May to $274,000. That’s a drop of 3.9% for the same period.

Inventory in Fair Oaks is at 6.5 months based on the last year of sales and 6.8 months based on the last six months of sales. Foreclosure inventory is at 1.7 months no matter how you look at it and short sale inventory is at a year and a half.

Home Listing Prices May Be More in Line with Homebuyer Expectations

Well, maybe. Or home sellers and banks are just waiting to see how aggressive (or passive!) home buyers will be this year. With the hottest months of the year arriving, both in real estate and in terms of the weather, listing prices have steadied. According to Trulia, 22% of homes on the market today in the United States as of June 1, 2010 have had at least once price reduction since they went on the market. This is a decrease from 23.6% of all homes that had a price reduction as of June 1, 2009. The average discount however continued to hold steady at 10% off the original listing price.

Cities in the Western United States experienced the largest decreases compared with the previous year with Las Vegas leading the way. Vegas had a 67% decrease. Yes, our very own Sacramento tops the secondary list there along with Oakland, San Jose, Los Angeles, San Francisco and San Diego with a price reduction of 24% or more.

Price reduction levels for luxury homes priced at $2 million of more held steady with 21% experiencing a price reduction and an average reduction of 14% off the listing price.

Arden-Arcade Real Estate Market Update: May 2010

Real estate sales in the Arden-Arcade area have picked up since we last took in a look in February of this year but we have yet to see if this is because of the summer/spring bounce in sales or it is sustainable over the year. 88 homes sold in the month of May, an overall increase in sales by 22.2% year over year. Foreclosure sales on the other hand fell by 25%. Short sales jumped 260% (they went from 5 to 18) and non-distressed home sales increased 31.4% year over year. 1 out of 2 homes sold are now non-distressed.

Average price per square foot fell slightly by 6.1% year over year. It currently rests at $164.12 down from a high of $174.73. Average sales price followed the same trajectory to settle at $251,671 from a high of $268,815 last May. That’s a decline of 6.4% year over year. Meanwhile, median sales price gained a miniscule 1% from $179,000 to $180,750.

Overall inventory hovers around 6 to 7 months in the Arden-Arcade area, foreclosure inventory around 2 to 3 months.

Where’s the Balance?

As with all other cycles, this real estate cycle of excesses will end. So says – in paraphrase – David Crowe, chief economist of the National Association of Home Builders. The Los Angeles Times reported that it may seem odd to talk of shortages in this era of foreclosures and excess inventory, but the cycle will change someday and when the market returns to “normal” we may see more homebuyers and not enough homes. As a result, the multi-family category will be hit hardest, in other words, apartments may get harder to find. Also, since so many homeowners have had foreclosures or other credit/financing problems today, mortgages might get harder to acquire as well. He suggested that apartment builders need to “start now” if they want to be ready when the shortfall comes.

What interests me while watching this entire market go up and down and all around as it has lately is how what we call balance and “a good real estate market” always lasts such a short while. What exactly is a good real estate market? A seller’s market? A buyer’s market? I tend to believe it’s when most home buyers with good credit or decent credit qualify for a home purchase that they can afford and inventory in most areas is not more than 3 – 6 months. Such a balance though is going to be hard to find today with the foreclosures and short sales and also because as sellers and buyers we’ve gotten spoiled by easy credit and quick sales. Today the pendulum has swung to the other extreme where borrowers with good credit are still having a hard time closing escrows they worked so hard to put together.

We’re just going to have to wait and see where this market goes. As a real estate teacher once said, it may be a buyer’s market or a seller’s market but it’s almost always an interesting real estate market. Not a dull moment.

Land Park Real Estate Market Update: May 2010

Some interesting changes year over year in the real estate landscape of Land Park – I’m glad I took a peek! 16 homes sold in the neighborhood liked by quite a few homebuyers. This number was 15.8% lower than it was a year ago in May. 3 of these sold homes were foreclosure sales, 2 were short sales and the rest 11 were non-distressed properties.

When dealing with such small numbers of sales, statistics can sometimes seem to jump very high and very low as we see with prices. Average price per square foot is now $274.63 up a whopping 29.8% year over year from a low of $211.64. Homebuyers for some reason also picked up homes 26.3% smaller than a year ago, a glaring difference that makes the average sales price (not based on price per square foot) a little inaccurate. It is now $378,125 down 4.3% year over year from $395,126. Median sales price is now $349,750 down 9.2% for the same period.

Land Park has an overall inventory of 6.2 months based on the last year of sales and 7 months based on the last six months of sales. Foreclosure inventory still hovers around 3 months, one of the largest in Sacramento county.

Homebuyers in Escrow: Federal Tax Credit Extended!

I received this “hot off the press” in my mailbox yesterday, so technically it is not breaking news, but I know so many homebuyers who are upset about delayed escrows and extended timelines lately in the real estate process that this is good news for those worried about waiting on banks. Read on!

The Senate has approved a plan to give homebuyers an extra three months to finish qualifying for federal tax incentives that boosted home sales this spring. The move by Senate Majority Leader Harry Reid would give buyers until Sept. 30 to complete their purchases and qualify for tax credits of up to $8,000. Under the current terms, buyers had until April 30 to get a signed sales contract and until June 30 to complete the sale. The proposal would only allow people who already have signed contracts to finish at the later date. About 180,000 homebuyers who already signed purchase agreements would otherwise miss the deadline.

Remember this only applies to home purchases already in escrow with a signed and executed contract from on or before April 30th, 2010.

El Dorado Hills Real Estate Market Update: May 2010

Since we last looked at the El Dorado Hills real estate market in March, prices have dipped a little again. The price dip probably accounts for the increased unit volume of sales. 60 homes sold in the area, an overall year over year increase in real estate sales of 7.1%. Foreclosure sales dipped 31.6% for the same period whereas short sales increased by 33.3%. Non-distressed sales also gained ground by 25% for the same period. 58.3% of all homes sold are now non-distressed as compared with 50% last May.

Average sold price per square foot has risen 1.9% year over year from $158.65 to rest at $161.60 currently. On average however, homebuyers bought smaller houses – 6.2% smaller than last May, to be precise. Average sales price is currently at $506,593 which is a small-ish drop of 4.5% year over year from a high of $530,385. Median sales price now rests at $438,875, also a decline of 5.6% year over year.

Inventory in El Dorado Hills has remained steadily at 6.9 months.