Sunday, April 15, 2007

Sacramento Regional Real Estate Trends for April 14, 2007

Inventory took off like a rocket this week, increasing by 631 listings, or 4.4% over last week:

Here are the weekly increases by county:

Sacramento: 4.1%
Placer:            5.3%
El Dorado:    5.0%
Yolo:               3.8%

Overall inventory is running 17.6% over last year at this time.

Increases are beginning to occur in all price ranges, with each county showing its own particular bias:

The all-time high for the $200K-$300K range in Sacramento continues to grow, but we are starting to see movement in the $350K-$400K range as well.

As for overall prices, all of the counties saw asking price drops last week except for El Dorado:

The slight increase in El Dorado is probably due to some of those expensive listings coming back on market.

Weekly change trends held fairly steady, with roughly 9% of listings showing price reductions:

In Bizarro World, I mean, Flipper World, we saw a glimmer of false hope emerge. Flipper market share in Sacramento actually decreased this week for the first time in months:

Unfortunately, this "reduction" was only due to the huge influx of non-flipper inventory that came on market last week:

Sippn and others have brought up the fact that many of these "flippers" are really bank REOs. Although it is impossible to say for certain on each individual listing, it should be possible to parse out aggregate REO data using certain filtering criteria. Once I work out the kinks, we should have a slightly clearer picture of what the market is up to.


Perfect Storm said...

Sippn and others have brought up the fact that many of these "flippers" are really bank REOs.

Doesn't the Bank become the flipper by deault, literally?

What's the difference?

Josh said...

Doesn't the Bank become the flipper by deault, literally?

True, true. But there's other things you can learn if you know which listings are REOs:

1. By comparing to REO listings to foreclosure stats, you can see how much pent-up REO inventory is out there.
2. You can look at the FIT:REO ratio and see how many of these guys are getting foreclosed on.
3. Agent Bubble can pull the numbers directly out of the MLS somehow, but his data relies on the listing agent being honest. A derived value can be used to ground truth the MLS.

How useful these data are is another factor. I'm sure most people don't care if it's a bank or individual investor losing money. But who knows? There might be something interesting in the data that we can't predict.

The whole FIT thing itself began as a curiosity question. :)

Perfect Storm said...

Can you use to identify bank owned properties and compare to your FIT list in order to identify which FIT is now Other Real Estate Owned by Banks. Also, I guess it would be hard to identify the trust deeds investments taken back by individual investors, as these are not OREO, but just property they own now.

... said...

Playing to your hand, it could be the FIT market share is decreasing because the FITs are now on the market longer - over 2 years since purchase (see FIT definitions)

A bank REO is a flipper, but in the desired world, they'll sell for more than the loan amount, possible when 20% down payments, but not very possible with 5% or less down in a market that declined.

Dr Housing Bubble said...

This is good information. Not only will you see pent up demand explode in the next few months, you will see prices being cut aggressively at least in the REO market. Banks do not want to hold properties for a long time. They'd rather slash the price and get the house off their hands. They don't have time to fight a market with 10 months of inventory.

You mention they'll be flippers by default. Actually it is worse because lending is tighter and homes are being kicked back. They'll need to sell in a depreciating market with less buyers - the definition of a real estate decline.

In Southern California in certain areas including Ventura sales are down a whopping 45% year-over-year.

Dr. Housing Bubble

... said...

Well, if there is pent up demand (I agree) wouldn't that ultimately wear down inventory numbers until prices rise again (caused by demand)??? Already seeing that in areas and price ranges not impacted by overbuilding.

BTW, your website cites a 6.9% yoy decrease in Ventura, where is this 45% you speak of?

patient renter said...

Agent Bubble: Any info on that Folsom house that went to auction a few weeks ago where the "top 4 bids over 350k were to be considered?"

Anonymous said...


That house on Smith in Folsom went pending. I think that was a double escrow. It works like this: Some mortgage broker knows someone in the right position at New Century and offers $300,000 for the house. Then they list it with a broker for first offer over $350,000 and clear $50,000. I have seen a couple of situations that look suspiciously like this.

The crooks just keep raping the system. Luckily there is a paper trail and they will get caught. Also, now that New is in BK, it may take a trustee approval to deliver the property.

patient renter said...

Bubble Sitter: Wow, that is interesting. Definately be sure to follow up with info on that once it closes.

Gwynster said...

I found out today that there is an inverse relationship between the size of the listing agents hair and their ability to hear the phrase "I am looking for short sales and foreclosures".

I can say that Woodland is in worse shape then what the FITs listings show. I have pictures of blocks where there are 3 houses for sale in a row and right next door are rentals coming available.