Sacramento Real Estate Blog: Home Prices 41% Off Peak
The Sacramento Real Estate blog reports that Sacramento County's price per square foot was $149.84 in April, a 33.9% drop from last year. That translates into a 41% decline in 31 months. Of note, this is the first resale home metric to cross the 40% off peak mark.
With regards to asking prices, Housing Tracker shows a median price decline of 28.9% year-over-year. The median has dropped 37.7% since August 2005.
More Sacramento real estate market figures for April at the Sacramento Real Estate Statistics blog.
From the Central Valley Business Times:
Home values in the first quarter of 2008 fell 1.6 percent from the fourth quarter and 7.7 percent from the year-ago quarter, marking the most significant year-over-year decline in the past 12 years, Zillow says.
Many in the Central Valley might wish they had it so good. The Stockton metro area has seen one of the nation’s sharpest year-over-year price declines, Zillow says. The 33.5 percent plunge puts the median price for all types of homes at $244,000. In the Central Valley, home values are down in every market monitored by Zillow.
• Fresno, $204,500; -22.8 percent
• Chico, $239,000; -14.6 percent
• Bakersfield, $196,000; -23.4 percent
• Sacramento, $289,500; -20.5 percent
• Stockton, $244,000; -33.5 percent
Zillow Q1 2008 Report
More fun maps from the Federal Reserve via the Wall Street Journal [pdf].
From the Bakersfield Californian:
Tim Fryer is stuck with $7,000 worth of useless letters for the entryway of a tract gone bust. The Bakersfield signmaker is among many local companies scorched by the bankruptcy of Sacramento developer Dunmore Homes Inc. “I paid out of pocket,” said Fryer, owner of Victory Signs, about two cast-metal sets of logos, vowels and consonants spelling “Diamond Ridge” that now gather dust in his shop attic.From ABC 7:
The 319-home subdivision in southwest Bakersfield won’t go forward under the Dunmore name. The homebuilder’s assets are currently being liquidated in a federal district court in Sacramento. Fryer doesn’t expect to get any money back.
Like other small subcontractors — Victory Signs employs eight — he’s at the end of the line for any bankruptcy payouts...A litany of such businesses supplied Dunmore entities with everything from engineering services to portable toilets.
UC Berkeley Business School Professor Tom Davidoff of the Haas Real Estate Group predicts that we haven't hit the bottom yet. "There's no way prices fall 30-40 percent around Stockton and don't fall at all in San Francisco, that just can't happen," said Davidoff.From the Sacramento Bee:
After 35 years, a landmark restaurant site in Old Sacramento is dark. The Fat family has closed California Fat's Asian Grill & Steakhouse, which originally opened in 1973 as China Camp. "It was a combination of things. No. 1, the economy,"...says Jerry Fat.The "take the money and run" loan officer gets 15 months in prison.
Finally, hell freezes over. (hat tip Dr. Housing Bubble)
14 comments:
HELP!!
My girlfriend's dad is thinking of retiring to Roseville to be closer to the family.
His realtor is stating that in Roseville the housing sales are booming! There are multiple offers coming in on the houses. Including one he is interested in that had 3 other bids.
I've been a long time reader of this blog and Ben's and think it's a load of BS regarding multiple offers. I'm hoping someone on the blog might be able to shed some insight as to what might be going in Roseville.
Thanks
ralphk,
Realtors are trained liars. They will say whatever is necessary to close the sale in the fastest manner. They do not have your best interests in mind, even though you are paying them to "represent" you.
Often they will point you in the direction of a property that they can "double end" and receive commish from the buyer and seller, your preferences be damned. They also tend to be more attractive and have a stronger, more persuasive personality than the average person. This makes the average Joe or Jane subconsciously want to "please" or emulate them.
My suggestion would be to find a realtor that is older, more experienced, has a long track record in the community and who does this for enjoyment and not for need of a great amount of income. In other words someone who has a comfortable retirement that pays the bills and does real estate on the side.
Ralphk
It's entirely possible that multiple offers are happening on homes in that area. I've mentioned this tactic before. Banks are laying in artificially low prices on properties they own, well under the comps, and well under "current" market pricing. They're fully expecting to get more than one offer, and are willing to chance that the home will sell at the lowly listing price. In essence they're running single home silent auctions and letting the market decide on the price.
Last weekend my wife showed many properties to a family moving to the area. The one they liked was pending with three offers against it. It was bank owned, lower priced than anything comparable in the area, was in great shape, etc. They decided not to get in the game on that one.
Now the business is booming part is all BS. The agent can truthfully say there are multiple offers happening in the marketplace. Left only at that one would think that the market had turned...When a nice home comes on the market and it's priced between $110-120 per sq ft. it will get some attention and likely multiple offers.
It's an intersting strategy because the market is changing weekly. Whatever those multiple price offers end up at, that will be the next price point for the bank to deal out more homes in the area. Kind of like a loss leader or market pricing indicator.
We had the same line sort of fed to us...
...they did have other offers in the house...
...but none were official or in writing.
smf....that's probably IS a BS line.
Banks are losing big time money for everyday they hold their inventory. They're competing with each other to dump as fast as they can. They don't know what today's price is, no one does. The entire industry is scrapping for too few buyers, and the only ones buying are those that get that "too good to be true" feeling...and they, along with others, jump at the chance...In a way it's a brilliant tactic because it does move homes.
Perfect storm's prediction of
50 percent off in 09 is looking
right on.
And smf's too many houses for too
few buyers is what's escalating the
price declines.
Looks like I'm stuck renting a while longer
Make no mistake, those multiple offers are coming from investors. The realtor just wants to make an offer and in writing, stat. It means less money for them in the long run.
What they don't tell you is that those other offers are for 2/3 to 1/2 of the current list price. Talking the asset manager into accepting 75K less is harder then getting them to take your 25k off.
>>>>
My girlfriend's dad is thinking of retiring to Roseville to be closer to the family.
>>>>
Tell him to rent for a while and figure out the market for himself.
The multiple offers thing is a scam. There is no hurry to buy anything.
Not true. It may be a scam in some cases...when you get as deep as this one's gotten ...but that's not what's happening and for very good reason. The banks don't have to accept any low ball offer when they're listing price is 15-20% below the "perceived" market price to begin with. They are locating price points that move inventory. Without doing this they just sit and attract more cost. Banks don't have to accept any offer except a full priced offer from a qualified buyer that meets their regs. Any investor who wants to squeeze another $25K from there won't even get a look in favor of a reasonable offer to the contrary...In March a realtor in my wife's office put an offer in on a 2900 sq ft bank owned home listed at $310,000. There were many multiple bids. The realtor lost the home and it sold for approx. $365,000.
Don't kid yourself...if the home is priced right it's going to sell...if it's priced really right, more than one buyer will be interested...and not all the offers will be a reduction from the list.
Create the right buzz with the right price and people will buy...simple sales stategy that's stood the test of time. It doesn't matter if they're investors or that elusive homeowner wannabe.
Don't kid yourself...if the home is priced right it's going to sell...if it's priced really right, more than one buyer will be interested...and not all the offers will be a reduction from the list.
We had an offer in our house within the first week of putting it for sale. We priced it right, of course.
Now, there are a couple of caveats on that:
Sometimes, people wait a little bit before looking at a house that just came to the market to not seem 'desperate'. We did that.
We had far more people looking into our house AFTER it went sale pending.
And most of all, there are still way too many people believing that these price declines are temporary and before long 2005 prices will be here again.
If you believe this, it gets easy to justify buying a house for a temporary rental and then selling it in the next few years.
That'll be another shoe to drop in a couple of years.
I've lived in Roseville for 25 years and have followed RE closely in this town for the past 5 years. I call BS. I see all kinds of properties sitting idle with no bids whatsoever. Unless the home is priced for $20 I haven't heard of multi offer sales in a while. Prices continue to erode and will through 2009.
I placed a bid on a Roseville REO back in march that was priced WAY under any other REO I have seen for the size,location and condition. There were 7 other competing bids on the property.
Funny thing....Everyone was lowballing. The asking price was $330,000 and it sold for $332,000 even with 8 bids.
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