A Case Study of Distress California Housing: Sacramento County.

The Sacramento Association of Realtors provides excellent data on real estate market trends for Sacramento County.  It is unfortunate that we don’t have comprehensive data like this for the state of California housing.  Yet this data is helpful because it reflects similar outcomes of other California counties like Riverside or San Bernardino.  When we examine the data, what we find is a market dominated by distress sales and lower priced conventional sales:

This is excellent information.  The number of closed escrows fell in the last data order prescription drugs online report but not by much.  The big trend is with REO and Short Sale information.  Short sales in more mid to upper tier markets in California have been largely absent.  But in this data set they make up a good portion of sales.  However, the big market mover is the REO subset making up nearly 45 percent of sales.  Months of inventory is low at 3.2 months and the median price of sales is $183,000.  Last year at this point when prices were already depressed the median price was $194,950.

The mean is at $207,199 so the bulk of home sales are falling within this range and if we look at the mode, this is confirmed with the $200k to $249k range.  So what is happening is we have a market that does have brisk sales but only because of lower prices and a glut of REO inventory.  If we look at the overall sales count for the year, sales have increased:

Now compare this to last year:

It is a simple equation.  Home sales have jumped up 12.2 percent while the median price has fallen 22.2 percent.  Cheaper homes move inventory.  If we dig into the financing data what we find is indicative of many distressed California markets:

The majority of sales are FHA insured loans and cash buyers.  That is, we have a large number of first time home buyers most likely lured by the $8,000 tax credit and many cash investors probably looking to buy cash flow properties.

It is great to have information like this because it really tells us a lot about a housing market.  It is unfortunate we don’t have data like this for the state of California.

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