Sacramento Real Estate Views

Listen to your Grandma! News from the trenches..

The Sacramento real estate market over the last few years has left much to be desired but the signs are there that this nightmare is coming to an end…the proverbial “light at the end of the tunnel” is appearing, the angels are singing on high…Oh the Rapture! aahem! Sorry, it’s been a good month for us so far and I’m excited.

With all of the negative media talk, it’s hard to hear through the shrieking to get to what’s going on out there right now.

In the new homes market, builders are generally the last to feel the market pinch and the first to see the signs of recovery. One of the reasons for this is that the larger builders are publicly held companies that have boards of directors and stock holders to answer to. They will do everything they can to get homes sold, meet goals and that means they price their homes right, some offer incentives or give things away to motivate people to buy.

This last weekend, the builder I work for, Pulte Homes, Inc., had a sale. It was a nationwide event where we offered 4 free options, this primarily was directed at homes that are “out front” or yet to be built or six months with no payments, closing costs paid, directed toward inventory or 30 day escrows.

Our national goal for this event was 60 homes sold for our division. We shattered that goal, shattered I tell you!

Of the homes sold that weekend about 45% were sold in the active adult communities of which there are 2 in the division. This is significant. Why, you ask? The active adult buyer is one of the most savvy buyers in the market. Typically they have bought and sold many homes. They have been through many downturns and know what the signs of recovery look like.

While they may have years of equity in their current homes, they are generally on fixed or limited incomes and don’t often like to take risks unless the risk is minimal.

Traffic at our communities is up 39% since the first of the year and cancellation rates are down 8%. More people are looking and less people are canceling. If fewer people are canceling and most who are buying have homes to sell, the resale market must be picking up as well.

Mike Lyon from Lyon Real Estate is quoted as saying recently that the pending sale number doubled from December to January. I spoke to a Coldwell Banker agent today who told me he lost an all cash offer he made for a client on a property recently. Why?

Because there were 8 other offers on the same property. Multiple offers? In this market?

45% of sales in the active adult communities. Are your grandparents trying to teach you something? Something that even the SacBee doesn’t want you to know? I think so.

Ignore the headlines…this is an awesome article by a nationally known money guru…take it to heart. Your Grandparents have!

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Tags: New homes in Sacramento, Sacramento homes, Sacramento real estate market

This entry was posted on Monday, March 10th, 2008 at 9:49 pm and is filed under Real Estate Market Commentary, Rocklin & Roseville New Homes. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

1. ...liz said at March 11th, 2008 at 6:46 am

   Not really surprised by the percent of active adult sales you mention. Most reaching retirement have weathered many economic ups and downs in their lifetime and know this too will pass. Time is just too precious to wait out this blip when a new dream home and retirement life is calling.

2. robsaxe said at March 11th, 2008 at 7:12 am

   Thank you for the insightful comment. I’m honored that you would visit and contribute.
   Rob

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