Sacramento Real Estate Views

Total Number of Homes for Sales Increases

Is The Sacramento Real Estate Market Slowing Down?

Every month this year the total number of homes for sale has been increasing.  With tax credits offered by both the state and federal governments, it’s been a boom for first time home buyers over the last year and a half. (they represent over 50% of the home sales over that time)

Many economists and industry experts have been saying to expect a “double dip” in the housing market with second dip still to come and eminent now that the federal tax credit has expired with no sight of there being another extension on the federal level.

Experts have also said that interest rates would be going up as the fed is all but done buying mortgage backed securities thus keeping the interest rates artificially low.

While sales numbers since the 4th quarter of 2009 have been steady, seasonally adjusted, the total number of homes for sale has been increasing.  Is this the beginning of the slow down in sales that industry analysts have been predicting?  Or is it just the seasonal increase that we see most every spring building up to the “selling season” before summer begins?

If inventory levels continue to increase and sales just stay where they are, we could see the second dip in our market that further depresses values.

Local Economy Is Slow To Recover

With unemployment in our region at or exceeding 12.5% and the state of California, the largest employer in the region, teetering on the verge of bankruptcy, it doesn’t make sense that the area would see a quick housing recovery.

Yet, many areas in the lower price ranges have increased in value and sales have been brisk throughout the region due to the affordability factor.

Now that the tax credits are coming to a close, I would expect that we’d see a slowdown in sales in the Sacramento real estate market.  That said, I don’t feel that we’ll experience another “crash” so to speak.

It feels like the dip we’ll see will be more shallow than last time, if there is a dip at all.  We’ll probably experience more of a slow down and a subsequent flattening rather than a dip.

The Sacramento region has taken a larger hit in the housing downturn than most other areas of the nation excluding Nevada, Florida and Michigan where losses have been similar to ours.

While I have no crystal ball and can’t predict anything and can only speculate like the rest of the industry analysts, I’d say that until we straighten out the economic mess in the state, the Sacramento region real estate market will be on unsteady ground.  That said, housing will plod along without much in the way of gains for some time to come.  I hope I’m wrong.

A stretch? Well…no, LOL but at least I’m here following the market and keeping you updated.  What’s your agent doing?

Thanks for visiting SREVS.com!

No related posts.

Tags: homes for sale sacramento rocklin roseville

This entry was posted on Thursday, June 10th, 2010 at 11:31 am and is filed under Real Estate Market Commentary. 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.

Leave a Reply