Home Sales Up 73% In Sacramento

Existing home sales in the Sacramento region increased in July for the 4th straight month and posted a 4th straight year over year increase. Existing home sales in July were 5% higher that June 2008 66% higher than July 2007. Homes sales have taken off since the spring, driven by falling prices of the large amount of foreclosed properties hitting the market. In some areas of Sacramento foreclosed properties make up to 80% of the sales.

As bankers cut prices to move the inventory, the median price continues to fall. Sacramento County, as the heart of repo-land, had the median price fall 4.5% from June to $210,000. Several of the more affluent counties around Sac County showed slight price increases for the month. Overall median prices are down about 30% from a year earlier. I have come across some interesting anecdotal data on the effect of foreclosures on median prices which I will write about later.

Inventory of homes for sale continues to fall, with 10,954 available for sale vs. 11,121 in June. Note: I am using the TrendGraphix numbers to maintain consistency between my monthly posts. The SacBee article quotes 11,644 for sale, “…the lowest since February 2007.” TrendGraphix also notes 23% of the homes for sale are bank repos. Numbers vary between reports due to the number of counties the report counts as part of the region. No matter how the inventory is counted, at the current sales rate it is a 3 month supply and foreclosures are being bought as fast as they come on the market.

It appears many buyers believe the housing market is nearing the bottom are are very willing to buy distressed real estate. I am now waiting for some of the repo inventory to dry up and pricing to firm and increase. I will write soon on how much I believe that foreclosure sales are depressing the median prices.

Finally, Southern California, a much bigger and more important market, had it’s first year-over-year sales increase in July since September of 2005. Barry Ritholtz often remarks that there is not a recovery until the year-over-year numbers show gains. Let us see if this trend continues and spreads and Barry acknowledges it.

Source:

Top Stories - Home sales up again across Sacramento region - sacbee.com.

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