Email ElizabethFebruary 2021 Sacramento Area Housing Market Update
February 2021 Sacramento Area Housing Market Update is a powerful overview of the market written by our own Josh Amolsch. Buyers should understand they need to listen to their real estate professional to win. — Enjoy, JaCi Wallace. Well, here we go again, a new episode of the Sacramento area housing update. The horror show is the modern buyer’s life and what keeps homeowners awake at night. At least the February 2021 Sacramento area housing market update numbers show some promise. New listings are up 2.4% from January but down 16.4% from February 2020. Inventory rose for the first time since October 2020, but only 7.7% from January, and was still not enough to replace the homes that went into escrow. I think March will see another down-tick in inventory, which means another record for median home prices.
Speaking of median home prices, check out the chart above from the February 2021 Sacramento area housing market update. If the Sacramento area was a mutual fund, you probably wish you would have jumped in back in December 2019? Well, I probably shouldn’t show you the chart going back to 2011. 2011/2012. It was probably the once-in-a-generation time to buy at the bottom of the market while also getting the lowest rates we had seen until the summer of 2020. Rates were great last year and still are, but the median price in Sacramento County was $160,000 in December of 2011. That puts your deal in 2021 into perspective, doesn’t it?
The 2021 Fire Season
The 2021 fire season is a timely topic for our weekly blog post, written by our very own Josh Amolsch. Enjoy! — JaCi.
Growing up, I remember four distinct seasons in California: spring, summer, fall and winter. It doesn’t really seem like that any longer. The seasons now just kind of run together, so it is either cold or bloody hot. The Sacramento mega-region housing market seems to be taking cues from the global warming conversation, too. The 2021 fire season is likely going to be just a continuation of the 2020 fire season, 2019 fire season, and so on.
The conversation piece many a Realtor adopted last year was that lumber prices and Sacramento area home prices spiked due to many homes burning down in the Bay Area. These fires continue to send the Capitol City even more buyers than we were absorbing before. I think a lumber mill or two went up in smoke in Oregon, too, but that could have been caused by the rioters.
Whatever your thoughts may be on the subject, I think we all expect another barn burner of a year for the Golden State’s 2021 fire season. So, when more people lose their homes and maybe another lumber mill or nail factor gets charred, maybe it won’t be all about the interest rates that are driving up prices. People gotta live somewhere, and the home buying frenzy shouldn’t soften at all this year. Buyers and sellers would be wise to get an experienced, seasoned real estate team to guide them through the process.
Weintraub & Wallace Realtors with REMAX Gold Real Estate are here for you if you are looking to buy or sell. Call us today at 916.233.6759.
Writing Multiple Offers in Sacramento
Writing multiple offers in Sacramento is a very timely blog post written by our very own exclusive buyer’s agent, Josh Amolsch. Enjoy. — JaCi Wallace.
These multiple offers are happening almost everywhere in the greater Sacramento area currently. Inventory, along with interest rates, is extremely low. What’s a buyer to do? Seek the advice of an experienced Realtor with local expertise. Try different strategies that take into account the specific needs of the seller.
How about changing what you are looking for? Look for properties that are overpriced and have been on the market while; these sellers may be motivated. But what about writing offers on multiple homes at once? It seems like a sound strategy, right? As a buyer recently told me, “I don’t want to sell myself short.” Well, I had to tell him that wouldn’t be happening, at least not with me as his Realtor. Yes, I would let go of a buyer who would ask me to transform into that shady agent no one likes.
Writing multiple offers when you can not afford to buy them all, could be interpreted as a violation of Article 1. (National Association of Realtors Code of Ethics) In short, I ain’t risking my license or reputation as a Sacramento Realtor. I am sure my team, who stands as a pillar of excellence and professionalism in the Sacramento mega-region, would appreciate all efforts to avoid a blemish on our brand.
This type of thinking, to write several offers at once when in fact, a buyer only can qualify to buy one house, should be bounced off of a qualified California real estate attorney. An attorney is qualified to interpret California’s good faith and fair dealing law. Why do it as this could get a buyer in hot water, and Realtors could face an ethic’s hearing or worse?
Imagine, a buyer writing multiple offers on five different homes all at the same time. Multiple offers can cause the prices to be driven up and this buyer didn’t truly intend to buy more than one home. Other buyers are now paying $5,000 to $20,000 or more because they had to beat out a half-hearted phantom offer. Yeah, I would be mad too if I was one of those buyers. Or what about those sellers in this scenario that accepted these phantom offers? Now, it would be OK if the buyer could afford all the properties, was pre-approved, and had intentions of buying all the homes they wrote offers on.
Remember, anyone can sue anybody anytime, and it happens. Only a real estate attorney is qualified to determine if there are damages, but why play with fire? Do the right thing by having honest and fair dealings with all parties. Don’t be writing multiple offers in Sacramento when you can only afford to buy one house. When in doubt tell a client they should seek legal advice if they want to pursue this risky kind of behavior.
A few bullet points for buyers trying to get clever in this hot market:
- Get an ethical Realtor and listen to them.
- Don’t write offers on more homes than you can afford to buy at once
- Adjust your criteria for a home if you keep getting offers rejected
- Don’t give up.
For effective guidance & creativity that keeps us all legal and ethical, please give us a call. We will get you into a home, and it is always the right one. Call Weintraub & Wallace Realtors with RE/MAX Gold Real Estate. We can be reached at 916.233.6759
January 2021 Sacramento Area Housing Market
January 2021 Sacramento Area Housing Market, written by Josh Amolsch, is an informative eye-opener, Enjoy–JaCi Wallace.
Sacramento is officially in the big leagues. We have now reached a median home price that is only a couple clicks down the recent Kiplinger’s list from New York, Los Angeles, San Francisco, San Diego, San Jose, and two or three other high-end but still fairly obscure cities. Maybe those cities were cow towns once before as well. A place only good for getting gas and asking the wife, “so where are we at again?”. Yes, Sacramento reached a new high in January, a month where prices typically go down, and inventory goes up. January 2021, and all the vicious action therewithin, birthed a $449,000 median home price for Sacramento County, an 18.2% increase from Jan 2020. Placer County shot up 17.8% from a year ago to $581,000.
It’s really simple when you think about it—the whole thing about how the current housing market resembled the run on toilet paper in 2020. Rates are crazy low, and those Bay Area buyers are still flooding the market. That isn’t anything new. That Bay Area migration has been steady for years. The thing that has exacerbated the issue has been the drop in rates, which caused a record amount of refinances. There are closing costs when you refi, and that can take many years to break even on. Why would someone sell and move to throw themselves into the dog fight of limited homes when they can stay put and lower their payment. Seems like an easy choice.
Check out the inventory graph above. New listings are not keeping up with new escrows. In fact, they are down 20% from last January, and sales are down 55%. So you can bet that bedazzled mask of yours that inventory will remain suppressed while prices increase more and more until affordability erodes. There is no price police, so this will need to play out naturally. I don’t mean to sound negative, but a healthy market is not what we are in right now. Something will need to give, and I think we have maybe one more year of this growth we have been experiencing. Government spending and its effect on bonds have everything to do with the housing market. When borrowing gets more expensive, buying slows, inventory rises, and prices stabilize—the hip bone’s connected to the knee bone thingy.
Everything has been upside down over the last year. EVERYTHING. I can’t even watch the news anymore. These numbers are crazy, but at least they are rooted in reality. When there are thousands of more buyers than there are homes to buy, you get a January where homes are going into escrow faster than they were at peak selling season. Usually, January is the slowest month; but not in Sacramento County in 2021. It’s all different these days. Redfin has Sacramento #3 on its Top 10 Most Competitive Cities to buy a home in, and lumber prices are up 169% since mid-April 2020. That has increased the price of new homes a median of $16,000 per the National Association of Home Builders.
If you want to win in this market, HIRE TALENT. Weintraub and Wallace Realtors can be reached at 916-233-6759 with RE/MAX Gold.
Josh Amolsch | Realtor
Weintraub & Wallace Team
Request An Appraisal Waiver When Purchasing A Home
Request an appraisal waiver when purchasing a home, can help you win in this competitive market. I was showing my sister homes and we had lost on a previous offer to cash. We found another property and they had to write an offer well over the list price. They called their lender to ask if the appraisal could be waived. We were not in contract yet. My sister was putting 20% down and having to make up the price difference between offer and list price. They called their lender and asked to run the automated loan approval with an appraisal waiver.
The lender ran it through both Freddie and Fannie. Freddie said yes no appraisal needed, 12 offers and we won! We are all so happy for Cat and Greg. Having an appraisal waiver can help to compete against cash offers.
The loan was approved today and inspections completed yesterday, so far all going so well. Thinking out of the box in this climate is what helps an offer to win. If you want to potentially win in the multiple offer market, request an appraisal waiver when purchasing a home. Call Weintraub & Wallace Realtors. We can be reached at RE/MAX GOLD, Sacramento, and Elk Grove offices, 916-233-6759
— JaCi Wallace
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