Here’s What’s Happening in Our Market

What’s really going on in the Sacramento real estate market? Find out in today’s market update.

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We’ve heard that since the summer, the market has been slowing down and undergoing certain changes. Well, I’ve done some research, and I want to show you what’s actually happening. I recently pulled the homes listed in the $300,000 to $700,000 range for four different counties, looking at the year-over-year data for the period between July-September of 2017 and July-September of 2018. In that period, I saw that the number of homes for sale is up by 23.6%. The number of homes that sold year over year, though, has dropped 5.6%. If you listen to the pundits and doomsayers, the market numbers are changing and there are more homes sitting on the market. But now let’s look at those same trends over the last seven to eight years (consult with the chart displayed in the video above at the 1:05 mark): Comparing it to last year’s figures, the number of homes for sale is up 19% and the number of homes sold is down only 2%. We have a significantly higher number of homes on the market now than last year—about 30%, in fact. This is not affecting how fast homes are selling, and neither is it affecting home prices in a negative way; those prices are still growing.

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Overall, the homes that are selling are still selling fast.

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There are a lot of homes that aren’t selling on the market, and many more listings are expiring now than in the past. To calculate the months of inventory—the amount of time it would take for all current MLS listings to sell, given that no new listings come on the market—we divide the total number of homes for sale by the total number of homes that have actually sold. This is usually done on a monthly basis. This figure takes into account the 18% of homes that don’t sell. We do tend to see more expired listings when the market values increase than when the market goes down, and that’s normal. So overall, the homes that are selling are still selling fast. The homes that are not selling are skewing our inventory numbers. Everyone is focused on the increasing inventory, but I think that we need to be focusing less on how many extra homes are on the market and more on what they’re selling for and how quickly they’re selling. If you have any further questions about this topic, go ahead and reach out to me by phone or email. I look forward to hearing from you.