An Update on Sacramento Real Estate Summer 2017

The latest numbers for both the national and local real estate markets are in. Here’s what you need to know.

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Thanks for popping by for the latest edition of the Sacramento Market Minute.

First, some national market news. The new numbers for the summer market show that pending sales are way up, while inventory continues to shrink. Regionally, the West leads the nation in existing home sales.

According to Realtor.com’s Chief Economist, Jonathan Smoke, the biggest challenge to buyers will be simply finding a home and getting it under contract. Supply is at an all-time low and demand is only getting stronger.

A lot of people have been asking if we are in a bubble. An important thing to remember is that the real estate market is cyclical. The length of the cycle is the only variable. Markets certainly have fluctuations within cycles, but over the last 100 years, real estate values have gone higher and higher each cycle. Any major downtrend in the market is followed by a new high in real estate values.

Even with high sale numbers, there isn’t an area where homes have recovered within even 15% of their previous highs. Most were priced around 20% lower than they were in the peak. Here in Sacramento, homeownership is at a 50-year low. Right now, our home buying and rental markets are some of the fastest rising markets in the nation.

If you’re thinking about buying a home, there is no reason to wait. The two things that determine your monthly payment, interest rates and price, are both rapidly increasing. You can lock them both in for the long term by buying now.

We’ve got a housing shortage on our hands.

Another thing to think about is that not as many homes are being built. Back before the market crash, builders were constructing 15,000 homes per year. This year, they will be lucky to build 2,500. It certainly looks like we’ve got a housing shortage on our hands.

If you have any questions about the Sacramento market or about your personal situation, don’t hesitate to give me a call. I would love to hear from you.