Sacramento-area home sales fall for 1st time since April 2008
By Jim Wasserman
The 14-month streak is over.
Sacramento-area home sales reached their highest monthly count yet this year in June. But with fewer bank repos on the market, they failed to beat the numbers from June 2008, according to new statistics released Thursday from researcher MDA DataQuick.
It was the first time since April 2008 – when year-over-year figures turned positive after three years of declines – that sales failed to beat the previous year. That’s the clearest indicator yet, said area market watchers, of the waning influence of repos – which last year ignited an explosion of sales among first-time buyers and investors.
"It’s tough to beat (last year) when you don’t have so many foreclosures out there to attract buyers," said DataQuick analyst Andrew LePage.
As banks hold repossessed properties off the market and contend with government foreclosure moratoriums, the market’s lower end has shifted from abundance to scarcity, agents and buyers say.
The competition for increasingly hard-to-find deals in the repo market is leaving some potential buyers frustrated.
"It’s impossible for us to get a foreclosure," said Karin DeFoe of Rocklin. "Since March we’ve lost three houses."
DeFoe described a scene now familiar to many buyers: initially low repo prices that stir a frenzy of multiple bids. Buyers are asked to bid higher; then the best offers are often rejected in favor of investor buyers with cash.
"They’re bidding lower than I am, but they’ve got cash," said DeFoe, who is trying to buy a house for her college-age son to rent.
Sacramento researcher TrendGraphix reported 6,705 real estate listings in El Dorado, Placer, Sacramento and Yolo counties as June ended. That’s the lowest number of homes for sale in the region in four years. Repos accounted for just 14.2 percent of the for-sale signs, compared with almost 28 percent late last year.
"The inventory isn’t hitting the market soon enough. I don’t think there’s enough for the demand out there," said Erin Attardi, a Sacramento agent with Lyon Real Estate.
DataQuick counted 3,758 closed escrows in June for new and existing homes in Amador, El Dorado, Nevada, Placer, Sacramento, Sutter, Yolo and Yuba counties. Repos accounted for 53.3 percent of Sacramento County’s 2,284 sales, the firm said. New homes were just 9.3 percent of sales.
Median prices, meanwhile, remained stable at $175,000 in Sacramento County, the largest sector of the region’s real estate market. That’s the same as last month. But it’s up from a low of $160,000 in February, when 25.3 percent of homes were priced below $100,000.
In June, just 18.2 percent of sales prices dipped below $100,000, DataQuick reported. The firm has credited rising median prices across much of metropolitan California to a rising share of higher-priced homes in the sales mix.
Attardi agreed, saying, "I think it’s a combination of short sales penetrating that higher market where they weren’t prevalent before."
Short sales – in which lenders accept less than owed to avoid higher costs of foreclosing and reselling in a falling market – are, indeed, rising as repos lose market share. The Sacramento Association of Realtors said this week that short sales accounted for 16.6 percent of transactions in Sacramento County and the city of West Sacramento in June, up from 14.5 percent in May.
"It’s a complete shift," said Mike Toste, a Roseville real estate agent who has built a new team to ride the wave. Toste, of Coldwell Banker Sun Ridge, said many lenders, especially the Wells Fargo subsidiary Wachovia, are finally making short sales easier. Lender response times that formerly frustrated agents with 90-day waits have been halved, he said.
"Wachovia is responding in seven to 10 days," he said. Toste, Attardi and others say more than half the for-sale signs in the region now are short sales.
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