Friday, May 26, 2006

Sacramento Area Price Level Inventory For May 25, 2006

A new feature I am adding to the blog is inventory plots for different price ranges. Hopefully they will help us see any emerging pricing trends as they develop a give us a feeling as to the markets direction.

For the most part, each price range seems to be following the general market trend of consistent inventory increase, although the price levels with the highest inventory seem to be growing fastest. It will be interesting to see if any solid trends develop in the next few weeks.


Anonymous said...

Consider the OFHEO numbers for Sac released on 6/1/06. Nationwide, prices fell in fifty-two MSA's last quarter. That's big news in itself.

But then restrict your inquiry to the fify largest MSA's (as defined in the last PMI Mortgage Co report.) Prices fell in four of the fifty largest MSA's last quarter. Below I've shown the 4 "large losers." I've also listed the drop last quarter and the 5-year increase.

If the drop in Sacramento does not accellerate at all, nominal prices will fall about 1% in 2006. (The real drop is worse, of course, if you adjust for inflation).

Then notice which of the four large area has the farthest to fall among the four that have already started dropping. Sac has by far the steepest runup in the last five years. This region is one of a handful of the large MSA's that have seen triple digit increases over the last 5. This shows just how steep the slope is if prices continue to slide.

Warren-Troy MI.. -0.45...18.77
Denver-Aurora CO. -0.35...21.15
Cambridge MA..... -0.24...50.3
Sacramento CA.... -0.24...112.23
San Jose CA...... -0.20...45.75

Note also: yesterday Forbes listed Sac as the fastest growing foreclosure region. And in the last week we saw that Sac is also the fastest growing area for new construction. This seems like a lot of stored energy.

Max said...

Yeah, I get the feeling that Sacramento is on the edge of something. Median asking prices are still high, even in the face of record inventory. Sellers just aren't feeling the pain yet.

This summer should tell the story.