Sacramento County Real Estate Market Update
I generally write my first real estate market update of the month on the fourth, since our MLS, Metrolist, gives us three days to enter any sales results. So by the fourth the data is usually about as good as it’s going to get.
However, I don’t want to be in the position of writing a market update on Fourth of July. I may have no life, but I know where to draw the line so that I at least look like I have one!
Unit Volume Continues Strong
Of course there’s the usual bad news about prices and the high foreclosure rate in Sacramento County. We’ll get to that in a minute. On the plus side, unit volume continued its rally. Unit volume was not only a smidgeon higher than May’s (with 1900 units sold reported to date for June, versus 1879 for May). Year on year, however, unit volume is up 75% from last June’s figure of 1086 units. So June was the fifth month in a row where unit volume was up compared to both the year before and the month before.
Prices Down Substantially
Two thirds of the homes that sold in Sacramento County in June were bank foreclosures. With another 8.4% of June’s sales being short sales, distressed sales accounted for 75% of the total sales in June. Not surprisingly with this many foreclosures on the market, prices have been dropping quickly. Homes lost a third (33.3%) of their sold price per square foot value from June to June, going from $218.98 in June of 2007 to 146.07 in June of 2008. The average home sold for $237,900 in June of 2008, down 35.8% from last June’s value of $370,787.
Strong Competition for Better Priced Homes
With foreclosures priced as low as they are, competition for individual properties is fierce. Most of the successful offers I’ve seen come through lately have been over full price, and the average discount on bank foreclosures is growing more razor thin each time I look at it. In June the average bank owned property sold for 99.93% of list price, meaning there was less than $150.00 difference between the asking price and the offered price. (Note, however, that price alone does not include any concessions such as having the seller pay buyer’s closing costs).
As usual, foreclosures account for the bulk of the sales, with non-distressed sales in second and short sales a poor third. Making up only 28% of the active listings, foreclosures accounted for 66.6% of sales in June. In contrast, short sales currently make up 40.3% of the listings, but only accounted for 8.4% of the closed sales in June. Non distressed sales account for 31.8% of the active listings, and 25% of June sales.
