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South Placer County RE Market Report – January 2013

More Homes To Sell??

In looking at the numbers from Metrolist Services Inc. this morning, it appears there has been a small spike in the amount of homes there are available to sell in South Placer County.  In December there were just under a month of available homes to sell and in January that number jumped up to more than a month and a half at the current pace of sales.

With the majority of economists believing that the housing market is in full recovery, the same economists agree that it will be years before the market returns to “normal”, whatever that means.  In my career of 11 years in real estate full time, I’ve never seen a normal market.  I’ve seen bubbles, declines, both steep and gradual, but I must honestly admit that i don’t know what a “normal”market is. :-)

My sense is this uptick in the amount of homes for sale is seasonal and doesn’t reflect a trend.  That said, I’d love to see about 3 months of inventory available for sale.  This would help a lot of first time home buyers who are competing with all cash investors, and losing, get into a home.

SPlacer Months of Inventory Graph

SPlacer Month of Inventory 1-13 table

Over a 77% increase in the total number of homes for sale in one month is surprising considering there have been so few homes for sale for so long.  That said, we had a similar spike from August to September of 2012 and nearly the same, from a percentage standpoint, from the December 2011 to January 2012.  This makes me think it’s a seasonal bump but we’ll see in the coming months.

The number of homes available for sale has declined 84% since January of 2008.  The beginning of 2008 was the height of the foreclosure boom.  Inventory levels of bank owned foreclosures have been declining steadily since.

Average Sales Price Slows Down??

Over the last 8 months, the average sales price has gone up 2.7% however, from December to January, the average sales price slipped .9% in South Placer County.  The same thing happened from July to September of 2012 so again, not a pattern of declining home values but it is noteworthy.  That still leaves this area with an increase of 22.5% from January 2012 to January 2013.

If we begin to see a full 90 days of value declines, I do believe that would be cause for some concern but, not that I have a crystal ball or anything, I don’t see that happening.  The selling season begins to ramp up in earnest in April/May and I think it will be a good year for values.  Possibly as good as last year but we’ll have to wait and see.

SPlacer Avg Sold Price Graph

SPlacer Avg Sold Price 1-13 table

As long as interest rates stay low, I don’t think there will be significant downward pressure on home values.  The Fed has said they would help to maintain low rates through 2013 at least so this is a good year, as was last year, to purchase a home and with values going up as they have, it’s also a good time for those with equity to sell their homes.

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