Email ElizabethHome values are up can you still afford to buy?
Home values are up can you still afford to buy? This is a monthly post from our preferred lender, Dan Tharp, Enjoy as it’s a good one! Home prices in California are going up and will probably continue to do so. Does that mean they are less affordable?
The news can be misleading and confusing as it recently touted the significant move higher in the median home price, currently up 15% nationally versus last year. And 14.3% in Sacramento County, says the Sacramento Association of Realtors. 15% sounds awfully high. But the median home price does not measure appreciation. Instead, it marks the middle price point of recent home sales.
With a substantial lack of inventory for lower-priced homes, more transactions occur for higher-priced homes, which pushes the median home price higher.
The actual Sacramento home price appreciation rate was about 1.25% for the last quarter, or 5% annualized. And it is forecasted to increase by a similar margin next year. So have you been priced out of the market?
The short answer is no, or at least not yet. California’s affordability factor has improved year over year because mortgage rates are down by almost a full percent, and incomes have gone up (5.7% year over year nationally). Also, remember, only a portion of your income goes towards paying your mortgage. A 5% rise in income can offset a much more significant percentage rise in housing expense.
Let’s assume your monthly earnings did not improve from last year. Consider a buyer’s max purchase price of a new home, based on his/her income and debt was $450,000 last year. Maybe this buyer decided to wait because they were nervous about the market. Now, that home is worth about $472,500.
As a mortgage professional, if I were to use the same income and debt structure I used last year, this buyer would now afford a home for $490,000. This tells us that homes are actually more affordable, even though they have appreciated.
Granted, I am using very simple math here, and this does not get into down payment or cash required to purchase this home but is purely to show you the media doesn’t’ always get it right. Take the time to work through these numbers with a mortgage professional you trust, and don’t give up your dream of homeownership!
If you want to buy or sell a home call Weintraub & Wallace Realtors with RE/MAX Gold Real Estate in Sacramento. We service 7 counties and are top producers with a full-service team. Call us today for a free market analysis or to discuss your goals for homeownership. We can be reached at 916-233-6759.
— Dan Tharp
Real Estate on Thanksgiving 2020 in Quarantine
Real Estate on Thanksgiving 2020 in quarantine, what a year it has been. As we near the last month of the year, it is EZ to be thankful. Real Estate has been very busy with historic low-interest rates. The buyers are still lining up to buy homes. Some sellers are moving out of state, others moving into larger homes to share with their families. Covid19 has created many college students moving back home, so many households need more space. An at-home office or home-schooling area and an extra bedroom or two are a huge plus for a listing right now.
Families are cooking more at home as restaurants are again closed to inside meals, it is to go only. Many people are making bread and growing veggies. Some have purchased small greenhouses. Many clients tell me they are playing board games and going for walks together. Freezers are on back-order as they are selling like hotcakes. During the warm weather, homes with swimming pools were selling way over list price as outdoor entertainment for kids has become highly desirable. We all remember the shortages of toilet paper and paper towels. Face masks have become part of the daily routine.
Real Estate on Thanksgiving 2020 in quarantine, the phone was still ringing and emails from so many clients wishing our team a happy holiday. We would like to wish all of you a happy Thanksgiving. Hopefully, you ate too much turkey and pumpkin pie.
Weintraub & Wallace Realtors with RE/MAX are here 365 days a year. Call us at 916-233-6759 if you need any questions answered about real estate or want to inquire about buying or selling a home.
— JaCi Wallace
Country Life On 300 acres In Rural Sloughhouse, Ca.
Country life On 300 acres in rural Sloughhouse, Ca. What a joy it is to walk this land. It is the constant discovery of a new tree or wildflower. The smell of the different grasses brings back so many childhood memories for me. I used to hike out into the open pastures where my horse was grazing. The wonderful smells of those days many decades ago come back like yesterday. Numerous birds are in the trees, busy calling out and welcoming the beginning and end of each day. Nature is miraculous.
This new listing is priced at $1.1 million with a 3 bedroom 2 bath home. Yes, it is country life On 300 acres in rural Sloughhouse, Ca. The location is private but close to Ione Rd, off the Jackson Highway. EZ access to Sutter Creek and Jackson. Also, the world-class equestrian center at Rancho Murieta is close by. Did you think you could find such a nice size farm for this affordable price? This won’t last.
Swimming hole on your own property
Yes there is a creek running through the property as well as a plentiful well and an irrigation well is ready to irrigate. The 2 dogs on the property police the territory and swim in the creek. The owner says the dogs can stay as they are as much a part of the land as the rest of the animals there. Chickens, goats and ducks enjoy a solar powered fenced habitat.
There are also fresh tomatoes in the garden still giving fruit in November. Numerous fruit trees are planted about the exterior. The home has all new flooring with a full bedroom and bath downstairs—a great room with vaulted ceiling, eating area, kitchen with windows all around for breathtaking views. The master suite is private, as well as another guest room is upstairs. An attached one-car garage and huge outdoor covered patio for summer evenings offer an outdoor and indoor environment for entertaining or simply having a nice meal with your own home-grown vegetables. Build a greenhouse and year-round garden is a reality—so many options for this one of a kind property.
This photo shows a nice meadow on 300 acres—approximately 20 minutes to Sunrise boulevard for an EZ commute to be at home living on rural real estate. Country Life On 300 acres In Rural Sloughhouse, Ca. is a reality for you. Call Weintraub & Wallace Realtors for a private tour. We can be reached at RE/MAX Gold 916-233-6759. Call today to experience rural living at its finest.
—–JaCi Wallace
October 2020 Sacramento Area Housing Market Update
October 2020 Sacramento area housing market update is a wake-up call for buyers. Another great blog is written by our very own Josh Amolsch. Enjoy — JaCi Wallace.
If you bought a Sacramento County home in October 2019, you likely have 15% more equity today than you did the day you bought it. Crazy, right? That is highly above normal. The October 2020 Sacramento area housing market update also shows the median home price increase from Oct 2019 to Oct 2020 in Yolo and Placer counties clocking in at 8.6% and 8.7%, respectively. Sure, the first few years of monthly mortgage payments are interest heavy, with less than half of the payment going towards the principal loan amount, but you still chip away at the loan amount. The heavy lifting this last year was in appreciation. The average annual appreciation, according to the California Association of Realtors, is usually 4-6%. Appreciation for 2020 is projected to be a little over 8%.
This graph above has been one of those “nod and mumble, yeeeeep” for me the past couple of months. Sellers are getting most of what they are asking and in many cases, much more. Homes are selling super quickly and often within the first day or two. New home starts are down 10% from July 2020 vs. July 2019 too, so where do people go to buy? Either to existing homes or they move out of state, a metric which, by the way, is the highest it has been in years. But even with the exodus, there are plenty of buyers in the Sacramento region to keep upward pressure on those home prices. Me and any other Realtor worth their salt don’t see it flipping the other way anytime soon.
“Well, what about the foreclosures coming down the pike due to all of the covid-related job losses?” While there are many foreclosure homes, “Foreclosure activity has, for all intents and purposes, ground to a halt due to moratoria put in place by the federal, state and local governments and the mortgage forbearance program initiated by the CARES Act” (Attomdata.com). Even when those foreclosure proceedings continue, minus the homeowners that complete loan modifications, there is so much equity built up in the market that these owners could very likely sell to a buyer, still make money and still retain their ability to buy a replacement home, thus keeping the level of buyers in the market flat or even increasing. We need more new homes, plain and simple. By and large, buyers don’t have faith in that “bubble is gonna burst soon” narrative.
A case in point is the red pending line in the above graph. October 2020 had the 3rd lowest inventory in the last 15 months but saw the highest number of homes go into escrow in that same 15 month period. October was not a normal October. When product volume is lower than demand, prices go up. But buyers don’t seem to care right now, or at any time in the last 10 years, so it appears. Interest rates are HISTORICALLY low, neighborhoods are changing, buyers’ temperament is changing, and my hairs’ color on my head is changing. It is fall, you know.
October 2020 Sacramento area housing market update is informative and will answer many of your questions about real estate in our area. If you are thinking of buying or selling real estate call Weintraub & Wallace Realtors with REMAX Gold. We can be reached at 916-233-6759.
— Josh Amolsch
Rural Real Estate Agent Is Living The Dream
Rural real estate agent is living the dream in south Sacramento County. Weekends are often crazy busy both showing rural property and living the rural life 7 days a week. A prime example of this was last weekend. My schedule started with a 10:00 AM showing our beautiful 10-acre Italian villa listing on Indio in Sloughhouse. The showing was set for 1 hour but went for 2 hours. The buyers loved the property and had many questions. This put my schedule 1 hour behind; that’s the life of a rural real estate agent living the dream.
I had already booked a 12:00 PM appointment to pick up three new chickens and return one from my rural residence, Regal J Farms, in south Sacramento County. Calling the chicken farm to explain was the next step informing them I would be an hour late. I ran home, put on my boots, grabbed the broody chicken and two portable animal crates, and flew over to pick up my three new chickens. The broody chicken was happily returned to the former owner. I took my new three chickens home. I put them in the chicken coop, and it is now 3:00 PM, and I’m due to show our Lodi listing on two and a half acres at 4:00 PM. My chicken coop is located next to my horse corral.
I went to throw some hay out and noticed my Gypsy Vanner horse; an 18-month-old 850-pound filly, was acting odd. She was up and down and rolling over and over and was moving her mouth back and forth. She also had loose stools. I thought, OMG, its colic, a severe, potentially life-threatening condition for horses. Immediately I grabbed a halter and lead rope and began walking the filly round and round the pasture. I called my vet to ask him to come out on an emergency ranch call. The next call was to my 4:00 appointment in Galt. I asked the buyer if Ok to meet him at 5:30 PM as I had an ER appt for one of my horses and was waiting for the vet. This lovely client said, “no worries, 5:30 is fine.”
I walked the horse for 45 minutes, and my brother in law came out with my back brace and took the horse for a few laps to give me a break. I had put on my farm apron to keep my work clothes clean, but it was a warm day, and I was feeling it. My equine vet, Dr. Hunter, showed up and gave my horse a few injections, listed to her stomach, took her temp, and left some probiotics for her. Whew, she was going to be alright. It is now 5:00 PM, and I have 30 minutes to drive 25 minutes to Lodi. I ran in the house, changed my shirt and shoes, and drove like the wind to Lodi–of course, I followed the speed limit.
I arrived in Lodi at 5:35 Pm, and the client arrived shortly thereafter. The children came and his wife and their parents–this was a second showing after a seller counter offer was sent out. They all loved the property gave the buyers a thumbs up. The buyer said OK, he would accept the seller counteroffer, and off to escrow we go. It is now 7:00 PM and starting to get dark. I said goodbye, drove to a chicken wing place, picked up dinner, and headed home to the farm.
Upon my arrival home, I had to move some chickens around as new chickens sometimes get picked on. I took the two older hens and moved them to my old chicken coop in the back of my property. I gave them food and water spread out some old hay for their bedding. and said goodnight. Then, back to the front chicken coop to check on the three new pullets hens. Two were golden, and one was black with metallic green feathers. They all seemed to be doing fine.
My Gypsy Vanner filly was resting, no longer in pain; what a relief. It is now 8:30 PM and time to eat. The lemon chicken wings were delicious. Late night is a great time to catch up on the paperwork. I sent off the Lodi property counter, and the buyer signed. We call this Lodi listing the mini white house, and yes, it went into escrow.
This is not an unusual day. A rural real estate agent is living the dream of daily ranch life and selling rural property. Of course, we sell all kinds of real estate, not just rural, but it is a block of our business, and we take every showing and every sale to heart. The key to all this is keeping your feet moving and updating people to keep appointments moving along.
If you want to hire a rural or traditional subdivision real estate expert, call Weintraub & Wallace Realtors with RE/MAX Gold. We can be reached at 916-233-6759.
JaCi Wallace
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