Monday, April 23, 2007

Not So Soft Landing: Sacramento Median Price Down By Double-Digits YOY

March 2007 median price statistics from DataQuick's dqnews.com (and archived here):

  • El Dorado: -13.72%
  • Placer: -7.79%
  • Sacramento: -10.53%
  • Yolo: -12.59%
Statistics are for resale single-family residences and condos as well as new homes. Percent change is from the same month last year or "year-over-year" (yoy).

Significantly, this was the first time Sacramento County's median price breached the negative double-digit threshold for this particular price measurement. It was also the 10th consecutive month of yoy price declines.

Click here to compare with other Sacramento housing market price indexes.

26 comments:

Cmyst said...

Well, that's interesting. Carmichael, one of my areas of interest, dropped 16%; yet Fair Oaks gained 10%. Why?
If you look back at both areas historically, they have pretty much been identical. Elverta, of all places, gained in value.

One of the places I was tracking went inactive. It's interesting to speculate as to why. From looking at the pictures and driving by, the house wasn't extensively remodeled, and the original owners still lived there and had bought in 1977 or so.
They only put it on the market 10 days ago. Why would someone put a home on the market for only 10 days? One would presume that if they lived in the home for 30 years, they'd be really sure they wanted to sell before going to the trouble of listing it. And surely, even if they got absolutely no interest, they'd wait longer than 10 days??

Gwynster said...

Cmyst,

We had someone do this in Davis. A 2/1 for 939K, I kid you not. He relisted it about a month later at the same price. However in this case the seller was obviously a speculator.

Sippn said...

Cmyst - I too track those markets and mostly Carmichael is down because not a lot of higher end homes on the market in '07 vs. Fair Oaks. Watch later in year, as higher end developments come on line.

Median prices vary alot when you have small volume and a wide varity of pricing ($200-2 million).

Note El Dorado County down %, but El Dorado Hills up %.

Gwynster, Davis is such a strange market, only one time of year that homes sell, when prof's get transferred, otherwise the market there always looks dead. Timing. Buy off season, sell in season. You might owe me a drink!

Gwynster said...

LOL I'd surely set you up with a scotch if I knew what bar you hung out in >; )

I posted a little of my dialog on Ben's blog but I think you are safe from wearing any drinks for a while. Agents in Davis will be smelling like cheap alcohol in the near future.

Gwynster said...

It's getting better:

This house is down to $146 per sqft.
2780 ROGUE RIVER CIR, West Sacramento, CA 95691**

It's a forclosure

wimpyVO2max said...

cmyst asked: Carmichael down 17% while Fair Oaks up 12%. Why? Data sample size is too small.

Elverta up 25% in March... on two sales.
Wilton down 31% in March... on five sales.

The reported -10.5% drop in sales price for Sacramento County as a whole is a reasonably believable number, however. There are about 300,000 detached single family homes in Sacramento County. With 1537 sales in March, that gives a confidence interval of about 2.5% at a 95% confidence level. The actual price drop is likely somewhere between -13% and -8%.

Sold in '05 said...

As we are now past the TWO year point for the market turning down, YOY price comparisons really no longer capture the full picture of housing value declines. To see the compounding effect we will need to look at Year Over Year Over Year - YOYOY. Really just use values of present month against values for the same month of 2005. Is anyone posting something like this yet?

Sippn said...

wimpy - finaly a stats guy! but you're talking a little stange language.

They'll ignore Elverta now but use it when the 3 sales next month are $200K (they included the lawn cars!)

How do you define actual price drop? Median, mean, mode? Same house vs same house? Do you subtract out what people would pay for rent anyway - the rest is the investment?

stfu said...

wimpyvo2. solid.

aggiealum said...

Existing home sales down 8.4%, largest %age drop since Jan 1989. Wasn't this the beginning of the last housing slowdown? I'm not being sarcastic here, I was too young at the time to have noticed. But now that I am a first time homebuyer waiting out the storm, I am noticing. Funny thing is, someone called me greedy for wanting to wait another year for prices to come down further

Sippn said...

You link to "average buyer" She had a good chart on #months inventory by zip code - very telling on where the problems are and are not.

Diggin Deeper said...

Existing home sales fall 8.4 pct in March

http://news.yahoo.com/s/nm/20070424/bs_nm/usa_economy_dc_1

Ouch!

Diggin Deeper said...

"Funny thing is, someone called me greedy for wanting to wait another year for prices to come down further"

I think all the greed is built in to the prices that have run up over the last five years. I'd rather be greedy and wait, then stupid and buy.

Diggin Deeper said...

April consumer confidence falls to August low

http://news.yahoo.com/s/nm/20070424/bs_nm/usa_economy_confidence1_dc_3

"Rising prices at the gas pump continue to play a key role in dampening consumers' short-term expectations. The decline in the Present Situation Index -- the first decline in six months -- warrants monitoring in the months ahead, as further declines would suggest a softening in growth,"

To me, the key phrase above is "short term expectations". I'm a bit confused by the reference to "short-term." High oil prices have now been with us for approximately 3 years and there doesn't appear to be any near term relief in sight. Imho, the Sacto consumer better get used to $3 gas as it may be the low water mark we'll be hoping for in the future. It certainly won't help those who want to buy a home for the first time or the affordability index for the move-up buyer.

Cmyst said...

Just to clarify, that was an 8.4% drop from Feb. to March, not YOY.

I don't think anyone on the selling side should be accusing anyone on the buying side of greed right now.
I look back on the sales histories of the homes I am tracking, and at least half were purchased over 4 years ago for less than half what they're on the market for now. People used their homes like an ATM. That was their greed, not mine.

norcalray said...

"Funny thing is, someone called me greedy for wanting to wait another year for prices to come down further."

It would be fair to call them stupid or dumb about money matters. If they want to waste money, let them.

Diggin Deeper said...

I certainly don't want to imply that anyone in particular buying today is "stupid". Only that with all the negatives coming out on the market, "the wait and see" buyer probably gets rewarded by waiting. If speculators and past buyers got caught up in the frenzy that drove the market up, the new breed of buyer will compensate... ie. Gwyster and her low ball ridiculous (but smart) offer scenario. Allot of us just get to sit back and watch with amusement.

Patient Renter said...

The month over month sales drop is huge. As someone in the Calculated Risk comments said, even Lereah wouldn't be so bold as to call a bottom after these numbers.

Gwynster said...

Hey now Diggin, I'm rather proud of those offers >; )

As I told one of the agents last Sat, they can sell to me now or next year. I can wait.

Diggin Deeper said...

Countrywide sees healthy market by 2009.

"Mozilo has long maintained that Calabasas, California-based Countrywide would survive an industry shakeout. He said the industry would begin "to see the light" in the middle of next year."

http://news.yahoo.com/s/nm/20070424/bs_nm/countrywide_dc;_ylt=ApuF_Z0PnW4qsFCTrBF.Ja.573QA

So does it get worse between now and then? Ought to provide insight to the question on whether now is a good time to buy real estate especially in the frothy areas like SoCal, Sacramento, and San Diego county.

aggiealum said...

2826 Zamora in Davis, $414/sqft!

Patient Renter said...

"Mozilo has long maintained that Calabasas, California-based Countrywide would survive an industry shakeout"

You would think otherwise with the way he's been selling off stock lately.

Gwynster said...

Then this will look like a bargain!

MLS #: 70030471
2/1 740sqft for $208 per

I'm seeing new builds in Southport listed at 150 sqft. These folks are huffing glue.

lexi said...

I hope Gwenster finds a really great bargain. Everyday I wake up
and remind myself it's not a good time to buy. I'm drawn to buying
like a moth to the flame. The prices are not low enough to make
sense and I do not have balls like
Gwenster to make low ball offers..
but if someone accepts her offer...
I just might grow some!! :)

norcaljeff said...

Fair Oaks is usually seen as a better place to live than Carmichael, just an observation from living in this area for over 25 years.

Cmyst said...

Yes, I think that most people believe that Fair Oaks is more desirable than Carmichael. If you look back to before the bubble, to '00 or '01, both zips had median prices in the same range, though. I think Sippn' is right; they built some really high-end stuff in Fair Oaks and that brought the median price there up a lot. I've finally given up entirely on the 818 zip. Many of the homes there are just wonderful, but many are also in flood danger and very small. The price/sq there is pretty high, and the crime rate is higher than average. The 818 zip used to be priced very close to both Fair Oaks and Carmichael, but then it got trendy and now it's higher by far.