Sacramento Real Estate Blog

Like many established neighborhoods, Sacramento’s Pocket Area is a one that has been less hard hit by foreclosures than other areas in Sacramento County.  As a result, price declines have been moderate in this area, but we’ve yet to see a recovery from last year’s sales numbers in terms of the number of units sold.

This year’s average home in the Pocket area fetched $352,207, down 12.8% from last year’s average of $403,729.  Sold price per square foot fell just slightly more, 14.2%, from $231.39 in May of 2007 to $198.47 in May of 2008.  While short sales and foreclosures comprised 72% of sales overall in Sacramento County, in the pocket area these sales made up only 43% of sales.  Unlike the rest of the county, where unit volume rose more than 70% in May, in the Pocket area unit volume fell by 36% from May to May, with 33 units selling last May compared to only 21 this May.  Nevertheless, active inventory in the Pocket area is currently low at 4.4 months, compared to 8.3 months overall for Sacramento County.

Several months ago the East Sacramento (95819) market was holding its own quite nicely compared to the rest of Sacramento County.  In April and May, however, East Sac started to take a share in some of the depressing news, with prices falling and inventory rising to almost the six month mark.

The average home sold in East Sac in May for $299.79 per square foot, down 16.3% from last year’s average of $358.29.  The average sale price fell less sharply, 6.1%, from $488,908 in May of 2007 to $458,834 in May of 2008.

In both years, total distressed sales (REOs plus short sales) were one sale — less than 10% of the total.

Unit volume is down this year 38.5% in East Sac, from 26 units last May to 16 units in May of 2008.  Inventory has been creeping up, but is still fairly low at only 5.8 months.

Sales picked up somewhat in the Rosemont area of Sacramento in May.  Fifty units sold in this area, up 19% from last year’s unit volume of 42 units.  On a sold price per square foot basis, homes lost 25% of their value from May to May, with the average home fetching $204.55 in May of 2007 versus $153.38 in May of 2008.

This year’s average home sold for $205,083, down 31% from last year’s average of $296,469.  Of the fifty homes that sold in the Rosemont area in May, 21 of them (42%) were non-distressed, 14% were short sales, and 44% were bank foreclosures.

Compared to Sacramento County as a whole, Rosemont experienced less sharp price declines and a lower rate of foreclosures.  Also, Rosemont currently has 6.5 months of inventory, compared to a county-wide average of 8.3 months.

Our Market Data summary for Rosemont (95826, 95827) for May is below:

Unit Volume Data

Price Data

Inventory

The area made up of North Sacramento and Del Paso Heights (95815 and 95838) is an one that has been clobbered hard by the market downturn.  Homes in these areas have lost about a half of their value in a single year, with foreclosures making up almost all the sales.

The flip side of that?  Buyers are seeing bargains, bargains, bargains, pushing unit volume up to more than twice last year’s figure.

This May’s average sold price per square foot of $99.77 in North Sacramento / Del Paso Heights is down 48.9% from last year’s average of $195.40.  The average sale price has fallen 55.9% during this time, from $271,082 in May of 2007 to $119,104 in May of 2008.

Unit volume has cranked up dramatically in May, with 97 units selling this may versus 40 last may, an increase of 142%.  However, this development is too recent to make a serious dent in the inventory.  With only 44 units per month selling over the last year, inventory is currently very high at 13.3 months.

This market update covers the zip codes 95841, 95821, 95864, and 95825.  This area saw much fewer foreclosures than the Sacramento County average, yet still experienced steep price drops.  94 units sold in Arden Arcade in 2008, up 10.6% from last year’s volume of 85 units.  37.2% of this year’s crop were REOs, 6.4% were short sales, and 56.4% were non-distressed — comparing favorably to Sacramento County, where only 28.6% of the properties sold were non-distressed.

The average home sold in Arden / Arcade Creek for $299,109 in May, down 32.3% from last year’s average of $422,108.  Sold price per square foot fell 27.9% over the period, from $246.71 in May of 2007 to $177.90 in May of 2008.

Inventory in Arden/Arcade is slightly better than the county-wide average, at 7.5 months.

Well, it’s almost the end of the month.  As most of you know, sometime around the third of July or thereabouts, it’ll be time to take a look back at June and give you a bunch of Average this and Days-on-the-Market that.

However, I know there are a few dedicated Sith Lords who like to read me so they can catch me making a mistake about the future, and I hate to see anyone want for entertainment, so I thought I’d tell you how the Summer’s going to go. 

Here then are some predictions:

1) June unit volume is going to be higher than it was in 2007.  Oh, alright, I cheated.  This is an easy one, because June’s unit volume as of now is already higher than last year’s, and we have several days left to go.  Last June 1,086 units sold all month — so far this June 1,105 units have sold.

2) The year-on-year unit volume increases for June, July, and August won’t be as high as they were for May, but they’ll be substantial — let’s say more than 25% in each month.

3) We won’t see big drops in inventory for Sacramento County for the next few months.  I’m thinking we’ll stay pretty even in the Summer, and then start rising a bit in the fall.  I hope I’m wrong about that and we get down to about six months by late Summer, but I don’t think it will happen.

4) Real Estate prices will continue to fall, though not as fast as at the beginning of the year.

5) Gas will reach $5.00 per gallon.  Sorry.

6) Purva Brown, the Sacramento Real Estate Gal, will have a baby girl.   She will be 7lbs 12 ounces at birth.

7) Hungry Parisians, tired of the Johnstradamus gag and out of bread, will riot in the streets.

Homes in Sacramento’s Northern Land Park / Curtis Park area (95818) enjoyed a fairly high price tag of $311.37 per square foot, down only 5.6% from last year’s average of $329.82. With this year’s buyers also picking off the smaller homes, however, the average sold price drop appeared more dramatic. Last May’s average home in 95818 sold for $547,833, while this May the average was $385,126, a 29.7% drop.

With price per square foot still above $300, this area also enjoys a high rate of non-distressed sales 73.7%. Unit volume this year is down about 10%, from 21 units last May to 19 this May. However, inventory is still low in this area at 3.8 months.

The Natomas area of Sacramento encompasses 95833, 95844, 95835, 95836 and 95837.  This is an area of Sacramento that has seen a dramatic rise in the number of foreclosures over the last year, with correspondingly steep price drops.  As a result, demand is now quite strong in Natomas.

This year the average home sold in Natomas for 272,810, down 29.8% from last year’s average of $388,821.  Sold price per square foot fell 29%, from $201.59 in May of 2007 to $143.08 in May of 2008.  In May of 2007, only 15.4% of the homes sold were either short sales or foreclosures.  By May of 2008, that number had risen to 79%.  As a result, unit volume more than doubled during this period, from 65 units in May of 2007 to 138 units in May of 2008.

Even with all that activity, however, there remain 8.4 months of inventory in Natomas.  Another strong month or two could easily put a dent in that, however.

The tables below have the numbers for May 2007 and May 2008 and the change during this period.

Unit Volume Data

Price Data

Inventory

There is no simple and straight answer to this question. Some Realtors have a number beyond which they will not show any more homes to their clients. While I have been known to limit the number of homes I show if I am unsure of my client’s motivation to buy, I doubt any one of us at Elite Properties has a preset number of homes we will show.

Usually, in one day it is best not to view more than a handful. The reason for this being that homes will converge in your mind and just become one big mess of backyards and bedrooms. So by that definition, calculate how many weekends you want to devote to looking at houses. (Most people shop on the weekends - you can consider about six homes as a day of shopping.)

It also takes clients about 10 - 15 minutes to look at each home. And then unless the houses are all in one community, there is also drive time between houses. So plan on about three hours of home shopping in a day - more if you’re up to it. But your Realtor might insist on a break at this point.

Happy Shopping!

No, that’s not two homes for the price of one — sorry — but you do have the opportunity this weekend to visit two of our most beautiful recent listings in Cameron Park.  Vicki Agregado-Babcock will be holding these two listings of hers open this weekend.  These great homes are within walking distance of one another, so you can easily compare features.

The homes are :

• 2701 Sandhurst Drive in Cameron Park  (See the map, photos, or the listing details).
• 3262 Sandhurst Court, Cameron Park  (Map, photos, listing details).

We have more information about these homes today!

Please visit the Open House, Sunday 1-4 PM or call Vicki Agregado-Babcock at (530) 409-1100 for more information.

I sometimes wonder about some of the ways the Metrolist MLS describes certain areas.  Let me go further.  Learning Sacramento area geography through the Metrolist MLS is like learning about climate science or who attacked us on September 11, 2001 from Fox News.  After a long period of head scratching you find you’ve imbibed more of a political agenda than scientific or historical fact.

For example, in some mysteriously inspired bit of geographical legerdemain, someone somewhere along the line decided to take Del Paso Heights, which everyone else seems to think is not in Natomas, but minding its own business to the east in 95838, and spread it out across all of Natomas.  Or perhaps some clever geo-linguistic civil engineer decided that the levy troubles of Natomas would be less threatening if the whole area could become elevated to the (obviously) lofty Heights of Del Paso.

Thus, Metrolist MLS identified the following areas:

95833 - North Sacramento Natomas Del Paso Heights
95834 - North Sacramento Natomas Del Paso Heights
95835 - North Sacramento Natomas Del Paso Heights
95836 - North Sacramento Natomas Del Paso Heights
95837 - Sacramento International Airport & Vicinity
95838 - North Sacramento Natomas Del Paso Heights

That’s all well and good, except it’s wrong.  When you try to overlay these zip codes on Sacramento County’s Maps of Natomas, and other published maps of the area by zip code, you come up with a scheme more like this:

95833-  South Natomas
95834 - South Natomas
95835 - North Sacramento / North Natomas
95836 - North Natomas
95837 - Sacramento International Airport & Vicinity / North Natomas
95838 - Del Paso Heights

So there you have it.  Del Paso Heights is now back in 95838, where Google places it.  Four out of five of the schools in Del Paso Heights school district are in 95838; one is in 95834. Del Paso Heights Elementary is in 95838.

Do we know where we all are?   Natomas?  Del Paso Heights?

You’re back in the saddle again. 

Woopee-Tie-Yie-Yo!

Your welcome.

This is a summary of the real estate market for Downtown Sacramento, 95814 and 95816. 

This is also a good time to make the following three points:

Real estate is local.

Real estate is local.

Real estate is local.

Yes, all over Sacramento County, foreclosures made up more than 60% of the sales this May, up from only 15.8% last May.

In downtown, however, a total of 1 foreclosure sold in May.  That’s one less than last year’s 2 foreclosures, with no short sales either year, so foreclosures are down 50%, downtown.  Eighteen homes sold overall — no short sales, so non-distressed sales made up 94.4% of all sales.

Overall in Sacramento County, prices fell like a rock.

Downtown, from May to May, the average sold price rose 9%, from $472,170 in May of 2007, to $514,753 in May of 2008.  The average sold price per square foot rose 8.5%, from $325.44 in May of 2007 to $353.26 in May of 2008.

As healthy as downtown is, however, in terms of price and the low number of foreclosures, you can’t exactly call the downtown market a seller’s market.  Inventory amounts to 8.1 months, and this year’s unit volume is down 10% over last year’s.  Still, with rising prices and low foreclosures, the makings of a very strong market are there, even if some of the indicators point the other way.

One of Sacramento County’s pricier areas, Fair Oaks, has experienced less price change than other areas in Sacramento County, and — perhaps partly as a result — did not witness a resurgence in buyer demand this year as most areas did.  Homes in Fair Oaks lost “only” 16.9% of their value — as compared to 34.4% county-wide.  Yet unlike Sacramento County as a whole, where sales are up 74.7% from May to May, in Fair Oaks, sales are down in May by 27.5%.  Last May 40 units sold in Fair Oaks, versus only 29 this year.

So we have prices holding up well and weak demand.  Those of you who are avid readers can probably already predict that foreclosures make up a lower proportion of sales in Fair Oaks than elsewhere.  In Fair Oaks, 31% of sales in May were bank foreclosures, 6.9% were short sales, and 62.1% were non-distressed.  This is almost a mirror image opposite of Sacramento County as a whole — where 64.2% of sales are bank foreclosures, 7.2% are short sales, and non-distressed sales make up only 28.6% of all sales.

This year the average home in Fair Oaks sold for $399,362, or $189.64 per square foot.  There are currently 7.3 months of inventory, somewhat less than for Sacramento County as a whole.

I’m tired of typing that Realtor® trademark symbol.

Here’s the plugin, if you want to get it.

In May of 2008, the average home sold in Citrus Heights for $202,869, down 30.3% from May of 2007’s average selling price of $290,931.  Sold price per square foot fell somewhat less sharply, 25.3%, from $204.81 in May of 2007 to $153.01 in May of 2008.

With average prices poised to drop below $200,000 (though remember this is for all residential units — including condos), Citrus Heights has seen a good resurgence in demand from year to year.  This year’s unit sales volume of 92 homes is up 42.6% over last year’s volume of 65 homes.  Although Sacramento County overall posted a higher unit volume increase of 74.7%, Citrus Heights boasts a lower inventory, at 6.2 months versus 8.3 for Sacramento County as a whole.

This year, of 92 units sold, short sales made up only 13%, while non-distressed sales accounted for 28.3%, and bank foreclosures accounted for 58.7% of all sales.  The chart below shows how that compared to last year:

Citrus Heights Residential Real Estate Unit Volume

The chart below shows the total number of homes that sold in approximately the last sixty days.  (I say “approximately” because there’s usually some lag time between the sale and when the sale is entered in the database.) 

For each area, we then break the total number of units down to show the percentages of foreclosures that sold (these are bank foreclosures, or REOs).  Then we show the number of short sales that sold.   Finally, we show the number of non-distressed sales — where the seller was not in foreclosure and had enough money to pay off their loan.

At the risk of once again grinding our favorite ax, note that in almost every case, short sales are the smallest category.  Their failure to close in any significant numbers relative to the offers written on them is why we often refer to them as fake listings.  What’s especially telling is how they compare to the non-distressed category, which typically are priced much higher yet outsell the short sales by a wide margin.

Sacramento County

Placer County

El Dorado County

One of the figures you should pay attention to when you’re buying a selling a home is the inventory for the area you’re interested in.  Inventory simply means how many homes are for sale now, divided by the average number of homes that sell every month.  If 5 homes sell every month, and 50 homes are available, that means there are ten months of inventory.  Inventory numbers over 6 months are considered signs of a “buyer’s market”, while inventory numbers under six months are considered to mean the area is in a seller’s market.  Low inventory means buyer demand is high and prices are probably rising (or in this market, falling more slowly).  High inventory means prices are likely to fall more quickly, and there are not enough buyers to purchase the homes that are on the market.  The higher the inventory, the more aggressively a seller needs to price their home to make it sell.

Another important number you should keep in mind are the total number of homes that sell every month.  If not enough homes sell, the statistics for a given area may not be very significant.  For example, in the table below, Courtland shows 4 months of inventory, but since only .3 homes per month sell, the statistics don’t tell you much.  In contrast, Citrus Heights has 5.6 months of inventory, and the figure is somewhat more reliable since 36.9 homes sell every month.

The report below includes tables for Sacramento County, Placer County, and El Dorado County.

Sacramento County

Placer County

El Dorado County

Here are some market snapshots for the three counties in our service area.  As you can see, Sacramento County was the biggest loser on price, experiencing a 34.3% drop in sold price per square foot from May to May, but posted a correspondingly strong 74.7% increase in unit volume from May to May, with 1,812 units selling this May versus 1,037 last May.  El Dorado County held its value best, but even with that lost almost 20% on a sold price per square foot basis.  Unit volume rose faster there (31.3%) than in Placer County (19.1%), yet this was not enough to bring inventory down substantially.  At 8.1 months, Placer County’s inventory looks like Sacramento’s (8.3), while El Dorado County still has some 12.6 months of inventory to work on.

Sacramento County

Unit Volume

Prices

Inventory

El Dorado County

Unit Volume

Prices

Inventory

Placer County

Unit Volume

Prices

Inventory

A lot of the times, clients see something that might be a potential red flag. Ants, for instance, can be an indication that there is moisture around the house (an issue with flooding or mold) or just that the place has ants in the lawn. When they see this, the first thing they do is assume the worst. While this might be a good way to stay away from any trouble, it is also a way to miss out on some of the best priced real estate. Something that looks like a potential problem in an REO say might not be one.

The best way to know is to get a home inspection. If you suspect some aspect of the house to be a concern, it is also a good idea to get a specialist in that area. For example, if you suspect something wrong with the roof, get a roof insection done. Roof inspections are usually free. If you suspect something wrong with the plumbing, see if the home inspector can tell you. If not, hire a plumber.

Sometimes you might find the best deals just because other potential buyers worried and ran at the first sign of trouble that later might turn out to be nothing!

Elk Grove (95758) was the area with the most sold units in May of any area in Sacramento, Placer, or El Dorado County.  112 units sold in May, 77 of which (68.4%) were bank foreclosures, while 23.4% of all sales were non-distressed.  Though short sales make up 54.3% of current active inventory, they accounted for only 7.2% of sales in Elk Grove in May.

With an additional 23.5% of active inventory being bank foreclosures, short sales and foreclosures together make up 77.8% of the active inventory.  Not surprisingly, prices in Elk Grove are down.  Overall the prices have fallen about a quarter from last year.  At $263,700, the average home sold in Elk Grove in May for 25.5% less than last May’s average of $354,152.  At $250,000, the median price is down 28.8%, while the sold price per square foot is currently averaging $146.34, down 27.7% from last year’s average of $202.37.

With prices falling and so much REO inventory, many buyers are taking advantage of the bargains.  As a result, unit sales rose 143% from year to year, from 46 in May of 2007 to 112 in May of 2008.  There are currently 6.1 months of inventory, but based on May’s absorption rates the numbers are less than four months.

When you decide to buy a house and then write a purchase agreement, you are to show you commitment to buy with what is called a “good faith deposit.” We usually recommend that a good faith deposit be between 1 and 3% of the purchase price, the higher the better. The reason we say the higher the better (and banks will counter to increase it anyway) is because it shows your commitment to buy the property.

This good faith money (usually a check made out to a title company) will go into escrow the day an agreement is reached between you and the seller. The title company will deposit it and hold it under your escrow number and file and address of the property. It will be tracked on the net sheet and only released to the seller at close of escrow.

However, you are usually given an inspection and contingency period to complete all inspections on the property. The default on the purchase agreement is 17 days, however it may be anywhere between 5 and 17 days. You must complete all inspections and approve all related disclosures within this period. If you find anything amiss, the contingency period is when you get to back out of the transaction and get your good faith money back.

If however the contingency period passes and you sign a removal of contingency form, your good faith deposit is essentially the seller’s. After this point if you decide you do not want the property, your deposit will get sent to the seller as “liquidated damages” for the time they stayed off the market in escrow with you.

I can’t tell you how many times I have heard this question. The implication always seems to be “…… or is the Realtor lying?” I am always inclined to believe the Realtor. First off, it would highly unethical for the Realtor to say that there is multiple offers on a property when there are not and secondly, it shouldn’t deter you from doing what you intended to do in the first place: Write your highest and best offer, as if you really wanted to buy the house!

In today’s market, in spite of the bad news you hear all around you, when homes are priced right (or as the REOs are - priced so cheaply) most home buyers know about them being screaming deals. Even the Sac Bee called bank-owned homes the new Gold Rush. So it is not uncommon for there to be multiple offers, sometimes way over asking price.

Believe your Realtor. Or find one you can trust. We’re happy to help!

All Real Estate is local.  Several months ago there was a big debate among some real estate bloggers about whether real estate bloggers should engage in the cultural crime of “localism”, or whether they should do whatever else they would be doing if they weren’t doing that.

I had to laugh, because, as I said:  all real estate is local.  If you doubt me, try buying a house that isn’t where it is.  Let me know how that works out.

You can say “the real estate market” is an oxymoron, or you can say “the real estate market” is an abstraction that often breaks down at the local level. 

Here’s an example.  Overall, area-wide, nation-wide, yes we’re all in a panic, the sky’s falling, oh my goodness, yada yada yada.  That said, for several months in row, East Sacramento was going through a serious seller’s market.  They didn’t get the memo. 

The seller’s market in East Sacramento later stopped.   I haven’t checked out the numbers this month yet, so we’ll find out later — maybe it’s back.

Meantime, owners in Folsom may with some justice declare that the seller’s market has traveled east of Hazel Ave and has landed squarely in 95630.  Yes, prices have come down from last year — albeit to a lesser degree than the averages for any of the counties that surround Folsom on three sides.  Sold price per square foot fell 14.9%, the median price fell 10.6%, and the average sale price — at $437,332 — was down 11.9% from last year’s average of $496,302.

However, inventory is down below the six month figure that traditionally defines the border between a buyer’s market and a seller’s market.  Based on unit volume for May, it’s down to 3.8 months, and even using the absorption rate of the last year, it’s at 5.06 months.  Best of all, the inventory figure for non-distressed homes — you know, those poor people who actually continued to pay their mortgage before they sold — stands at 4 months.

Unit volume is up 17.9% from last May, and the expired to sold ratio is down, from 38.8% (already a low figure) in May of 2007, to 15.2% in May of 2008.  The only fly in all this sweet smelling ointment is the figure for average days on market, which is up to 52 days (compared to 34 days last May).

It’s a good idea to read the entire contract - and although it seems like a lot, it’s not that bad. I usually send over a blank copy beforehand to my clients so they can read it at leisure and don’t feel overwhelmed by the size of it when it’s time to sign.

However, it is a good idea to especially read the parts of the contract that have been typed in or written by your Realtor. These are the negotiable parts - the rest is California policy for home purchases.

Pay special attention to the numbers on page one - this will include the purchase price, down payment and good faith deposit. Sometimes it might also include cash back to buyer for closing costs. Also pay very close attention to page two and the check boxes. This will specify who pays for what inspections and clearances and title and escrow. Currently, most Realtors in and around Sacramento split escrow costs 50-50 between buyer and seller, but make sure you know approximately what those costs are.

Other important things to consider are how long escrow will be, when you will receive keys, is there any debris on the property that needs to be removed by the sellers and how long you have to wait to hear back from the sellers.

I’m working on an offer for a buyer on a bank foreclosure. We wrote up an offer. After some back and forth, five days later we got our final addendum signed and returned from the bank, so at that point we were told by the listing agent that we had “verbal acceptance.”

Before I get into what happened next, I should point out that I’m not putting the listing agent in this case down. This agent clearly was being respectful of my buyers’ efforts, and immediately had the listing marked pending sale. The chances are excellent that all the issues I’m describing here will get ironed out routinely. Still, I thought it would be helpful if buyers and sellers had a better understanding of some of the problems that are caused when you start talking about verbal acceptance.

Very often, it turns out that verbal acceptance is every bit as much an oxymoron as “military intelligence” and “fresh frozen strawberries”. First of all, in California, a part of the Civil Code known as the Statute of Frauds says that certain types of contracts (including contracts for real estate) are unenforceable unless evidenced in writing.

So what’s wrong with accepting an offer verbally and then getting the final signatures later?

Several things:

1. Someone inevitably changes something.
   When we finally got the written “acceptance” from the bank (about a week after we got “verbal acceptance”), it turned out that they’d crossed out our close of escrow date and entered a new one, and that they’d changed the allocation of closing costs. Again, I’m not faulting the agent, here. Many times I’ve been on the other end and told an agent that (for example) my client’s offering $300,000, only to submit the offer later for $280,000. Was I lying? No, my client told me $300,000, then later decided instead to offer $280,000. That’s why verbal offers are on a par with verbal acceptance — they’re not worth the paper they’re not printed on, either.
2. When did acceptance happen?
   The other problem that “verbal acceptance” causes is fouling up our ability to date when acceptance happened. This is not a trivial thing, since many of our time frames such as the buyer’s inspection period and the date for close of escrow start when we get acceptance. Traditionally, acceptance starts when the offer and any counter-offers are completely signed by both parties. Enter verbal acceptance, and now you have three choices:
   1. The date of verbal acceptance.
   2. The date you got signatures.
   3. But remember, now, if you got signatures evidencing acceptance, but there were changes scribbled in by the person signing, even on the date in (2) you still don’t really have acceptance, you have a counter offer.
3. Time is Of The Essence
   Banks selling REOs and banks approving short sale always seem to want to get the buyer to move forward on their inspections as soon as possible, but the buyer has to pay for these inspections. Normally, again, we can work this out, but it’s a legitimate area of buyer concern if they don’t have anything in writing from the seller yet, and they have to shell out $450 to $1000 or more on various inspections.

Pay Attention

As always, having an experienced agent or broker who who will carefully review and explain the paperwork at each stage of the process is your best protection. Your agent should be pushing to ensure that all the terms are clearly spelled out in writing as soon as possible, and should have no qualms about pushing back on your behalf if what you get in writing wasn’t what you had agreed to verbally.

To be sure, foreclosure bidding can sometimes be competitive, and the sellers (banks) tend to be slow getting the paperwork done. In that case verbal acceptance is sometimes a nice way to make sure your offer is the one that gets that home taken off the market. But if you do go that route, you should think twice before committing your money to inspections, and your agent shouldn’t open escrow until you have written agreement on the terms.

I love this listing that Vicki-Agregado just took.  It’s right down the street from me — and right in Vicki’s neighborhood in Deertrail Estates.  It has a beautiful open floor plan, on a meticulously landscaped quarter acre.  It was just remodeled in 2005, and features Trek decking in the back.  This one shows beautifully.

2701 Sandhurst Drive, Cameron Park, CA

Location: Deertrail Estates

Wanted: bright, open floor plan. Competitively priced, yet not a short sale or foreclosure. Immaculately remodeled within the last few years. A big, shady, corner lot with a big back yard. All this in a fantastic location with great schools. Stop looking, we found it for you, and it would be an honor to show it to you. Or call your agent and get her to show you this before it’s gone.

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Vicki Agregado-Babcock

(530) 409-1100

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Pricing

Asking Price: $399,900.00

Property Location

2701 Sandhurst Drive
Cameron Park, CA 95682
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Features

Bedrooms: 3

Bathrooms: 2

Parking: Ample

Year Built: 1987

Subdivision: Deertrail Estates

Lot Size: .253

Garage Size: 2 car

School District: Rescue Union / El Dorado Union

Square Footage: 1640

Agent Name: Vicki Agregado-Babcock

Broker: Elite Properties

MLS #: 80055485

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Appliances

Range/Oven

Dishwasher

Sink Disposal

Microwave

Interior Amenities

Security System

Exterior Amenities

Fenced Yard

Trek deck

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VFLYER ID: 1693151

Purva Brown, Alan Greenspan and Johnstradamus have been predicting a real estate recovery as early as 2009, and I believe that we are beginning to see some very definite signs of that in Sacramento County.  Prices are still falling, but more slowly in the last couple of months.  More importantly, unit volume has been steadily increasing.  (See the right hand side of the chart, below).

When we say “unit volume”, all we mean is the number of homes that have sold.  (Perhaps the term “residential units” is handed down to us from the Coneheads).

Here are some unit volume statistics showing that — in terms of sales volume at least — the nadir of the market may have already happened.  (That is, of course, barring further economic collapse, big interest rate hikes, or an invasion of Elbonians). 

• Unit volume has increased steadily for the past four months in a row, after it began to slowly climb five months earlier from the bottom it had reached in October of 2007.
• In May, unit volume was up 64.2% over last May’s volume.
• Unit volume in in Sacramento County in May was the highest it’s been since October of 2005, just a few months after it hit its peak in June of 2005.

The Rest Of The Story

The upswing in demand that we’re seeing in Sacramento County is a result of falling prices.  At $248,786, this year’s average home sold for 33.9% less than last year’s average of $376,158.  This May’s median home sold for $225,000, down 34.4% from last year’s median of $343,000.  Sold price per square foot fell 33% during this time.

Heavy demand in May has helped sell off some of the inventory.  Inventory presently is at 8.35 months, down from 9.24 months at the end of April.  (Based on May’s absorption rate of 1703 units, it’s even lower, 5.3 months — seller’s market numbers).  In addition, the rising sales figures helped push the expired to sold ratio down, from 74.1% in May of 2007 to 34.8% in May of 2008.

REO’s continue to account for the bulk of sold homes, at 64.1% of sales in May, followed by non-distressed sales, which accounted for 28.8% of sold homes.  Short sales again eeked out a pathetic, Snidely-Whiplash-makes-the-banks-look-good third place, at 7.2% of sales.   (See Are Short Sales Fake Listings for more on that story).

When you decide to buy a home after seeing others and comparing it to them, your Realtor will probably pull out a stack of papers and lean against her car to write up “a contract” or will invite you to her office where it will be all written and ready to sign. (The tech-friendly Realtors of today - like us - might just discuss your down payment and other aspects of the contract with you over the phone and email you a pdf version of the Residential Purchase Agreement.)

The job of this eight-paged tome is to identify all the details of the escrow: the most important being how much you intend paying for the property, how much of a good faith deposit you will have and when it will be delievered to the title company, which title company you prefer to use, and in general who will pay what - title, escrow, closing costs, cash back and so on.

This contract is then sent to the seller for approval. Usually they will send a counter back and then once you and the seller reach an agreement in writing, these contracts become legally binding and escrow proceeds according to what has been written. The title company will process the transaction and the funds according to the Residential Purchase Agreement.

Further changes to the contract can be made but must be written and approved by both parties on an addendum.

Recently, Open Houses have been getting a bad rap. There’s been a lot of talk about whether sellers should just refuse to let their listing agents hold houses open due to a few robberies. A little bad news can go a long way.

Traditionally, Open Houses are held so that prospective home buyers can see the home without having to make an appointment with their Realtor (or any Realtor.) During the housing boom, Open Houses were the number one way to get homes sold - the Monday after the Open House we typically received anywhere from 3 - 5 offers if the home was priced attractively and showed well.

Today, the number of homes held open on the weekends has dwindled. Not only are there less buyers looking for homes - which makes it not worth the agent’s while to sit there for three hours or so waiting for a prospect who might not qualify - but homes are typically bank-owned and do not show well without furniture.

With the recent bank foreclosures crowding the marketplace, you will probably be told by your Realtor when you start talking about making an offer that the house you are looking at is an “as-is sale.” This means that the seller will make no repairs, termite or otherwise and will simply pass title on to you. They might not be averse to crediting you back money for closing costs - usually 3% of the purchase price - but you would have to cover the repairs.

In such a case, it is a very good idea to get not just a complete home inspection, but also a termite, and roof inspection of the property. Most contractors will also give you an estimate of what the project will cost. That way you know if you are willing to make the commitment to fix what’s broken, or just move on to another property where the seller will make repairs.