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Specializing in the amazing homes of East Sacramento and surrounding neighborhoods

Low Housing Inventory Levels

Low Housing Inventory Levels

Posted by on Feb 3, 2016 in Comps, East Sac, Homes For Sale, Pending Sale, Selling | 0 comments

Right now there is very little inventory in the market in East Sac as well as all the other neighborhoods in the greater Sacramento area. I’ve been telling clients for a while that we are at what seems like a historically low level, but I hadn’t taken the time to research the numbers. I just knew that having only 26 active residential listings in the East Sac/River Park neighborhoods is the lowest that I’ve ever seen it. Looking at the current listings I see that out of those 26 Active listings only 12 of them are properties that were listed in January. The other 14 are properties that have been on the market for a long time due to unrealistic price, poor location or condition or some other factor. Out of those 12 active January listings, 8 of them are less than a week old and are probably just wanting to have 7 days of market exposure before reviewing offers. Taking a look at it from a different direction I see that we have 46 Pending Sales in East Sac/Rive Park. 5 of those are long close time and have been Pending for a while, but the other 41 are properties that went Pending since the start of January. Most properties are going Pending within 2 weeks of being listed for sale. It is so tempting for me to go down the rabbit hole of data to find out how we compare with the low inventory records of the past (95816 and 95819 has a lower inventory today compared to January 2013 which was our historic low point for the county), but I’ve got to get back to work to help my buyers fight to get their offers accepted and help my sellers pick which of the multiple offers to accept on their listing. I don’t like using what I consider cliché terms for the industry, but this sure is a great time to list a house for sale. It’s a much harder time to buy one...

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How is the Market Doing?

How is the Market Doing?

Posted by on Dec 8, 2013 in Comps, Ramblings | 0 comments

I’m often asked how the market is doing. While each neighborhood has its own microeconomics that affects it, these are the numbers for the greater Sacramento area and it should give you a good idea of where the market is. Back in August of 2005 the Median Selling price was way up at $392,750 and then it went all the way back down to $160,000 by January 2012. (Click on the Chart to Enlarge It) During the height of the market we saw 2,325 escrows close in the month of June 2004 and at the slowest point we only had 707 close during September 2007. Now we are back to a much more reasonable level of transactions per month. (Click on the Chart to Enlarge It) 2002 and 2003 inventory was low and the prices increased greatly. In 2006 prices started falling and inventory rose to record levels in 2007. By the end of 2011 inventory has dropped to a very low level and by 2013 to historically low levels. This combined with relatively low prices and very low interest rates has made it a competitive market… (Click on the Chart to Enlarge It) (August 2007 and again in January 2010 SAR adjusted to better reflect short sales and bank owned properties on the market). The Months of Inventory is a reflection of how many houses are for sale and how many are being purchased each month and how long would it take for them all to sell at the current rate. Not surprisingly, the lowest Month of Inventory had been April 2003 and the highest was September 2007. 4 months of inventory is a balanced level with numbers lower than that being considered a sellers market and anything above that being a buyers market. We have been in a new historical low since early 2012! (Click on the Chart to Enlarge It)  So what does all of this mean? It means that the market was at a crazy low inventory for over a year, interest rates were at a historical low level and demand finally came back when everyone realized that the bottom of the market had passed. Prices have come up off the bottom, the frenzy has calmed and the years of pent up demand is somewhat satisfied. Sellers can’t assume a quick sale and a higher price than their neighbor just got. Buyers aren’t going up agains multiple offers on every property and agents are able to breath a little easier as we return to a more “normal” supply and demand. The market has changed, again. Who knows what winter and spring will bring, but I can tell you I’m happy that I don’t have to give my buyers the “multiple offer competition is the norm” prep talk at the start of a search. Now I have to give my sellers the “don’t expect your home to sell in two weeks” prep...

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Zillow, Zestimates, Love and Hate

Zillow, Zestimates, Love and Hate

Posted by on May 4, 2013 in Comps, Ramblings, Sacramento | 0 comments

I love Zillow and I hate Zillow. I love Zillow. I’ve loved it since I first discovered it a decade ago. My love of zilliow is for it’s compilation of information in a mapped source. I can pull up the app on my phone and zoom in on a house across the street from a listing and be able to tell my clients the lot size and square footage of their neighbors. I will probably be able to see what it last sold for as well. I hate Zillow. I hate how inaccurate the price opinion is in Zillow, what they call a “Zestimate”. They can’t give an accurate estimation of price just by averaging similar sized home sales close by. This doesn’t take into account upgrades, lot size and most importantly, location, location, location! East Sac can have a huge price change in just one block. Compare the sales in the Fab 40’s to any sale just one block outside of those boundaries. Some streets are quite with a full canopy of trees and the next street over could be a high pass through street with very little curb appeal. When a home owner tries to use Zillow to get an estimate of value on their house, they could be greatly off. Zillow recently published a very interesting article about the accuracy of their Zestimate numbers. Looking at Sacramento, they proudly state that 24.4% of the time their estimate is withing 5% of the actual sales price of any give home that sells. Without going into how much being 5% off on the price can cost a seller, let’s look at the rest of their numbers. When you increase the margin of error up to 10% they hit that 47.1% of the time. This means that less than half of the Zestimate numbers for Sacramento properties are within 10% of the actual value of the home. 74.8% of the time they are within at least 20% plus or minus the actual sales value of a home. Wait, this means that the other 25.2% of the time they are off by more that 20% of the actual value of the home! I don’t like those odds at all. As much as I love Zillow for the easy access it gives to a variety of information, I hate the false sense of accuracy the Zestimate gives buyers and sellers. Nothing can replace the accuracy of an experienced agent working the neighborhood and knowing the value of each given block and why the comps in the neighborhood might be better or worse than any give home....

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The Odds That a House Will Sell

Posted by on Dec 20, 2010 in Comps, East Sac, Pricing | 0 comments

Most people think that if you list a house that it will eventually sell. The odds right now aren’t very good and it surprises most people to hear what the numbers really are. These are the statistics from December 1st 2009 to November 31st 2010 for Non-REO or Short Sale Properties: 48% of all the houses listed in Sacramento County last year sold, 16% were still listed, 4% were in Pending Sales status and 32% didn’t sell and were taken off the market. I thought it would be good to look at it from a neighborhood level as well as the whole county to see if there was much of a difference somewhere like East Sacramento… Surprisingly, East Sacramento fared a little worse with only 45% of all the houses listed being sold, 16% were still listed, 5% were in Pending Sales status and 34% didn’t sell and were taken off the market. The best way to insure your house will be in the sold percent is to price it to sell right at the start. The first 30 days are...

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Pricing a Property

Posted by on Dec 19, 2010 in Comps, Pricing | 0 comments

Sometimes the process of pricing a home can be a stressful. Many sellers feel like agents try to control the pricing process. Some agents want them to list at a low price so it will sell easily and other agents promise that they can get a higher price than the market will support just to get the listing (and then a month later start the price reduction conversation). My job is to provide a seller with the best information about what their homes competition is on the market and the recent home sales that other agents and appraisers will be looking at. I give my professional opinion of what I would list the home for if it were mine and what I think it will finally sell for. I also consult with the 50+ other agents in my company and get feedback from those that are familiar with the neighborhood for their price opinion. After I’ve given all of these opinions and information, the seller tells me what price they want to list your property for. I give my honest opinion and the chance that I think it will sell at that price. The seller sets the listing price and as long as I think there is a decent chance of selling the property I will take the listing and support them and their price fully. Given that it’s my job to represent my sellers best interests, I always try to help them get the most for their property and the best way to do this is to set the price right at the time of the initial listing. This is an excerpt from and article titled “Selling Price vs. Timing” from the Consumer Reports in November 2002 and it still applies today. “Setting the correct price is key to selling your home quickly and profitably. John Knight, associate professor of real estate at the University of the Pacific, in a study of several-thousand home sales over a two-year period in Stockton, California, found that houses whose prices are changed sell for less than homes with no price revisions. The longer a house sits on the market, the more it is stigmatized in the minds of buyers.” Another way to look at it could be seen in this blog entry a while back:Listing Price and the First...

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Pricing your home to sell

Posted by on Aug 19, 2010 in Comps, Sales Price | 0 comments

I get regular questions on how to price a home to sell. Location and Condition are very important, but if it’s not priced right, it won’t sell. This article speaks to many of the points in pricing, but I think it leans a little heavier on the Sold comps than the For Sale competition in the market. Most buyers will look at all the properties for sale and compare your listing to them and only after they have made the decision to purchase your property will it be compared to what has recently sold. If you aren’t competitive, you won’t ever make it to the point of being compared to past sales. • How to Use Comparable Sales to Price Your HomeBefore you put your home up for sale, use the right comparable sales to find the perfect...

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