February 2006: Appreciation Falls to Single Digits, Monthly Price Declines End

Today, the Sacramento Bee reported on February 2006 DataQuick statistics for resale single-family detached homes. As previously suggested, the median price for Sacramento County rose in February for the first time since August 2005. After five months of decline, the median price for Sacramento County in February was $355,000 (up from January's $352,500, but still down from August's peak of $372,000). This graph shows the median sales price of resale homes since January 2004:

(Click to Enlarge)

On the other hand, the year-over-year (yoy) median price appreciation rate fell in February into the single-digit range (+9%). You would not know this unless you scrolled to the bottom of the article and looked at the chart.

This is the first dip under 10% in quite some time, probably since the beginning of the boom. (I looked back at the Sacramento Bee's articles for 2003-2005, and the lowest yoy percent change I could find was +16% in October 2003. Reporting of monthly Dataquick statistics in the newspaper is spotty before that point.) This graph shows the rate of year-over-year appreciation since January 2004:

(Click to Enlarge)

Two other counties also slowed to single-digit appreciation: Placer County (+5%) and El Dorado County (+9). Yolo was at +13%.

This rapid decline in appreciation is big news but was not reported in the body of the article. Since monthly prices began to decline in September, the Sacramento Bee has reported the year-over-year appreciation rates in the body of the article, mainly as a counterbalance to the monthly declines. (For example in January the Bee said: "The median sale price fell for the fourth consecutive month....Still, in each of the region's four counties the December median remained 11 to 20 percent higher than a year ago.")

This month, when the monthly number went up, the yoy was ignored. Hmmm. Then again, this month's article was written by a different journalist (Jim Wasserman) than the usual (Andrew LePage).