Don’t Buy or Sell a Home in Sacramento Until You Watch This!

If you're wondering whether it's a smart time to buy or sell a home in the Sacramento region, then this video is for you. With the amount of houses for sale well above the past several years, interest rates still elevated, and competition looking very different than just a few months ago, there's a lot to impact. In this video, I'm breaking down the latest data we have regarding housing inventory, home sales, prices, and much, much more, including migration patterns and how this compares to other parts of the country. Stick around because I'm going to share what this means for you and how to avoid costly mistakes in today's market. I'm Jason Walter, your greater Sacramento real estate agent and licensed loan officer. With that said, I have a lot to share in today's video. Thank you so much for joining me and let's begin. I first want to share this article from Redfin showing the migration patterns, how this all compares to other parts of the country. So it says here the top five states in which homebuyers search for home out of state were Florida, Arizona, North Carolina, South Carolina, and Tennessee. In contrast, California, New York, Illinois, Washington, and Maryland were the top five states in which homebuyers searched to move from. And here's a map of the U.S. As you can see here, the biggest area in which people are looking to move out of, you know, no big surprises here that isn't actually in California. The irony regarding this, though, is that out of all of the, you know, all of the U.S. major metro areas, Sacramento was the most searched for destination amongst homebuyers looking to relocate from the timeframe between February this year through April this year. So even though California is the top state in which people are looking to move out of, Sacramento is the most attractive market for people looking to relocate from a different area. Here are those top 10 areas in which people are looking to move to. That's Sacramento, followed by Phoenix, Cape Coral, Florida, Orlando, Florida, and Sarasota, Florida. In contrast, the top 10 areas in which people are looking to move from is Los Angeles, New York, Seattle, San Francisco, and Washington, D.C. And just to share kind of my own insights regarding what we're seeing right now, I'm seeing a lot of people who find me through YouTube but have already moved here. They might have lived here for about a year or two, and now they're looking to buy. Back in 2020-21, we had hundreds of people reach out to us who found my videos through YouTube, and were looking to move from Los Angeles, Texas even, the San Francisco Bay Area, all across the country looking to move to Sacramento. So even though Sacramento is the number one spot right now, the amount of people looking to relocate here, in my personal opinion based on what I've been seeing, is a little bit or a lot less compared to the onset of COVID. However, having said that, it's pretty remarkable that Sacramento is leading the nation right now regarding relocation, and that has been the number one spot for several months now. Alright, first a report I want to share with you guys is, according to Redfin, let's talk about home prices based on the median sale price. So half sold above this amount, half sold below this amount, that's the median number. So the median sale price, this is for the month of May by the way, the most recent trends we have from Redfin, is just over $511,000. Prices are relatively flat year over year. So one year ago, we're at $512,000, so a decrease of $500. So more or less, prices have been flat for about a year. Let's look at the past five years though, going all the way back until May of 2020. Back then it was $384,000, now it's $511,000. This means that even though home prices have been relatively flat for about two years now, looking at May of 2020, it's up by a staggering 33%. Now let's have a look at the amount of houses that actually sold. That increased by 1.3% compared to May of 2024. A slight increase, there's 384 houses for sale that sold in the Sacramento metro area this May. One year ago this time, it was 379 houses, so more or less flat year over year. Over the past five years though, this is pretty crazy because look at, I mean, this was at the heart of the spring home buying season and back when a lot of people were rushing to buy houses when we had 3% rates. So back in May of 2021, there was 555 houses for sale or 555 houses that actually sold. That was a big increase up by 42.3%. Now it's up by only 1.3%. So the market's not falling off the cliff, but it's also not surging like we had in 2021. Also houses are still selling fairly quickly. It's taken about 17 days to sell a house. This is days in the market. This is a timeframe when a homeowner lists their home for sale, they accept an offer from home buyer, and once the house is closed as escrow, that 17 day period from offer acceptance from the date when they actually list the home for sale is 17 days. So it's taken about three weeks to sell a home right now. Compare this to about five years ago. At this time, days in the market was 11 days. When we compare this to one year ago though, one year ago, it took 11 days to sell a house. So it's taking about six days longer to sell a house on average from 12 months ago. Also, according to Redfin, they state here, and I kind of like going to a little bit disagree with them regarding this. It says Sacramento is a very competitive market. Many homes are getting multiple offers. So I want to share some data regarding this because this is from Ryan Lundquist. He is an appraiser here in the Sacramento area. He does a lot of research and data regarding our market here. And here's a look at the average number of offers that we're seeing in the Sacramento region as of, I should say through June 15th this year. So on average, we're getting around one and a half offers per property. Some houses are getting seven offers and some of course are getting zero. He says here, it's possible to get one or two offers in many cases, if you are priced right. In other words, if you list your home for sale, if you overprice it, you're not going to get an offer. If you underprice it, you might get multiple offers. He says here, there was just over 4,500 active listings today in the Sacramento region. So many properties with zero offers. So here's my advice for you guys. If you're looking to sell, do not overprice your home because buyers are very cognizant of overpriced houses. And of course they have a lot more options to choose from, given a big increase in the amount of houses for sale. So if you're a home seller, price your house, I would say it will be a little bit more or less aggressive. Price it below market value to get multiple offers to drive the price up. If you overpriced it, it's going to sit in the market and it's going to cost you time and money. If you're a home buyer though, a great opportunity for you guys. You probably go on to Redfin, Rolls.com, whatever app you actually use. You'll probably see a live house for sale. Use this to your advantage. I sold three houses last week and two of my home buyers, I had a listing I sold for over-asking, but two of my home buyers received more than $10,000 in closing cost credits from the home seller. One of my clients received a $16,000 credit from the seller, which means that my client, the buyer, their out-of-pocket expenses in buying this house were decreased by $16,000. My other client received a $10,000 credit. This is way different compared to 2021 and early 22, when everyone was writing offers, you got six offers on average, and it was very challenging to get offers accepted. On top of that, buyers had to write offers, waiving their appraisal, waiving their loan contingency, writing an offer way over-asking, offering to pay for a lot of the closing costs. Now it's been flipped. Sellers are paying for a lot of closing costs. They're paying for commissions. It is an entirely different market, but it is not dead. As you guys can see here on average, I would say it's run a one to two offers and not six offers, but it's not zero offers either. So if you're a home buyer out there, go try to find a deal, write an offer for less than the asking price if possible, and ask for concessions like a closing cost credit to decrease your out-of-pocket expenses in buying a house. Okay, let's talk about housing inventory, because this is the main driver regarding which direction our housing market is headed. So I want to compare how what we're seeing here in California, also in Sacramento, house compares to the nation as a whole. This is according to resiclubanalytics.com. This is the percent change in the amount of homes for sale compared to one year ago, May 25 compared to May of 24. This excludes brand new home construction. So in California, we're up by 51%. Nevada is up by 58%. Colorado is up by 51%. We're also seeing a big increase in Maryland up by 57% year-over-year. Now this is the year-over-year change. Looking at the change compared to six years ago, back in May of 2019, way different, right? In Texas, they're up by 32%. Whereas in California, we still have 8% fewer homes for sale. This may compare to May of 2019. In contrast, in Colorado, though, they're up by 34%. Washington State's up by 26%. And of course, there's a lack of house for sale in the northeast. And of course, much of the Midwest as well. Now drilling this down further, looking at the metro areas compared to May of 2019, Denver has an increase of 65%. Austin, Texas, up by 71%. Punta Gorda, Florida, up by 100%. Memphis, Tennessee, another pandemic boomtown, is up by 46.9%. In contrast, again, a lack of houses for sale in the northeast and the Midwest. If we actually look at California, and look at, of course, Sacramento in particular, in the greater Sacramento area, this is including Roseville, which is just northeast of Sacramento, Folsom, along the Highway 50 corridor, including Sacramento, we have 1.9% fewer homes for sale compared to May of 2019. In San Francisco, in contrast, they have an increase up by 29.5%. Now here's a big picture for you guys. Because we have a lack of house for sale, historically speaking in Sacramento, but up greatly compared to one year ago in the past several years, home buyers have gained more leverage from home sellers, but not as much compared to other markets such as in Denver, Austin, Texas, and many parts of Florida, where it's a buyer's market in which buyers have an advantage over home sellers. Here's yet another way to look at this. Here's inventory on a national level. This may compare to all the way back until May of 2017. So for the month of May this year, there's around 1 million house for sale. Well above the past several years, but less than May of 19, 18, and 2017. So what difference a few years makes, right? Back in May of 22, there was less than 500,000 homes for sale. Now there's over 1 million. So inventory has more than doubled over the past several years. Of course, having said that, we're still behind pre-pandemic levels. Now let's look at Sacramento though. The Sacramento region, there's 5,100 houses for sale as of the end of May this year, well above the past several years. And of course, double from two years ago, back in May of 23. But at 5,100, this is on par with May of 2019 and a little bit higher than 2018 and 2017. In stark contrast, have a look at Denver though. The Denver metro area, just over 12,300 homes for sale, way above the past several years. And on top of that, way above are just a much higher compared to pre-COVID levels as well. We should be seeing around five to about 7,500 homes for sale. Now there's 12,354 homes for sale as of the end of May this year. This means that inventory in Denver has nearly tripled over the past several years. Let's also take a look at the share price reductions in Sacramento as well. This is according to altusresearch.com. For the week ended June 13th, this year, the share price drops at 39%. Let's just run it up to 40%. This means for every 10 homes for sale in Sacramento have reduced their asking price. This is higher compared to the past several years, really close to the same timeframe in 22. Back then it was at 36%, but higher than last year at 29.77%. This all goes back to home sellers overpricing their houses and therefore they have to do price reductions in order to sell their house. So if you're looking to buy a house in Sacramento, of course, reach out to me. I'll provide my contact information in the video description below. My advice for you guys though, look for existing houses, look for houses that have been priced or have been on the market for quite some time. But on top of that, if you're open to it, look at brand new home construction, because I'm seeing a lot of home builders in Sacramento offering crazy incentives, including one home builder offering a first year interest rate at 1.99% and a crazy low interest rate thereafter. So I'm seeing a lot of home builders offering a closing cost credit and or a much lower mortgage rate than what you can get on the open market to buy an older house, for example. And I have a lot of videos touring brand new home construction and all these communities in the greater Sacramento area. So please check out those as well. And of course, reach out if you're looking to buy or sell a home in this greater Sacramento area. With that said, I appreciate you guys so much. Please like and subscribe and we'll see you in the next video.