Sacramento Real Estate Predictions for 2007
It's that time of year where everyone's favorite parlor game is forecasting the future year. Here's your chance to post your predictions as to where you think the Sacramento housing market is headed in 2007. What will the real estate market look like next year? Will sales and prices continue to drop as inventory builds?
For those who want to be a bit more specific with their price predictions, here are the most recent (Nov.) median price statistics:
- SacBee/DataQuick (existing): $345,000
- Dqnews/DataQuick (combined): $355,500
- CAR: $365,000
- SAR: $357,000
9 comments:
310k
SacBee/DataQuick: $276,000
Dqnews/DataQuick : $284,400
CAR: $292,000
SAR: $285,600
This is 20% off Nov 06 #'s:
SacBee/DataQuick: $345,000
Dqnews/DataQuick: $355,500
CAR: $365,000
SAR: $357,000
Treating the SacBee's number as canonical, I can justify a median of $251,000 next December. That's straight-line trend with a plateau for the current holiday season and for January 2007.
Slow the trend of decline to 2% a month instead of 3%, and I get the same $276k as wftf.
According to DR Horton, 2007 will bring an increase in asking price for their new homes... so it says in their Sac Bee ads...
Pricing in 2007 is irrelevant, since it will decline all year and be lower in 2008 and later. It will remain flat for years after that, well into 2010.
It will take 5 years for prices to fall, incomes to rise, and rents to adjust, before it makes sense to buy anything.
That being said, I predict inflation will be 2.8%, home price medians will drop 15%, so the total decline in 2007 is 17.8%.
The SacBee/Dataquick median will drop from $345,000 to $283,500. The average homeowner will lose $61,500. That is a drop of about $5,000/mon.
For those who think it can't happen, look in the rear view mirror....it already did in 2006. The most realistic prognosis for the future is to look at the immediate past.
Yes horton is clamining they will bump it up next year, however none of the others are saying that. No centex, no Hov,no JTS, no Lennar. I guess its just DRH's scare tactic. We will not see the real damage till tract builders sell the unbuilt lots to other tract builders. The new builders will slash the price without any qualms and build completely different items cos they now are building where their competetor used to build. They dont give a crap. I know cos I bought in one such tract. Its comming and its going to get ugleeeeee.
Cool.
Cow_tipping.
It's going to be an interesting situation, as specuvestors discover they have no choice but to hold, since selling would mean such massive losses that they'd have to hand over cash to pay off the mortgage. This will prevent the market from rebounding -- with most people's savings gone in lost equity, the number of available buyers will be few.
Even a buyer who put 20% down would be close to having zero equity by now. So there's a nasty choice: do you petition for lower property taxes if getting a new appraisal means the bank could demand PMI?
Specuvestors won't be holding.
They will be mailing the keys to the bank.
There will streets full of bank owned homes. WAMU and Wells Fargo will need to open up sales trailers to sell their homes.
DR Horton can kiss my #$R%. I was out looking at their Lincoln homes in August and they tried this scare tactic. The sales rep said if you don't by now inventory will disappear, prices will jump and I'd miss out. 3 week later they contacted me saying that they would take another $30K off the price I offered previously. I declined and prices have still fallen.
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