New Listing - 6931-6933 Trovita Way, Citrus Heights, CA 95610

Great duplex multi-family income property opportunity awaits you in Citrus Heights! Convenient, high-demand location. The left side unit is 3 bedrooms/2 bathrooms with a 2-car garage, and the right side unit is 2 bedrooms/2 bathrooms with a 1-car garage. These units are a blank canvas for your updating after decades-long tenants. Spacious units flow nicely with lots of living space, open floorplans, big bedrooms, en-suite master bedrooms, ample storage, private/fenced backyards with lots of sunny space to garden or play. Both units have central heat & air and composition roof. Located near shopping, public transportation, parks, and schools. Don't wait! MLS# 19058660. Offered at $405,000. For more photos and information please visit 6931-6933 Trovita Way, Citrus Heights, CA 95610.

Backyard chicken rules within the City of Sacramento

I was asked this week if chickens are allowed at residential properties within the City of Sacramento. I have had several clients who live within the city limits who have had chickens. Chickens can be great for laying fresh eggs or as family pets. Thanks to an ordinance that was passed in 2011, the short answer is -- YES -- chickens are allowed, but of course that comes with plenty of rules to follow. For example:

• Maximum of 3 chickens per parcel
• No roosters allowed
• No slaughtering permitted
• Chickens must be in a coop at all times
• Chickens must have adequate food, water, and ventilation

There are also several requirements relative to the size and location of the chicken coop. And of course the city also requires a permit and fees.

To read the full list of rules per the City of Sacramento website, click here. And you should inquire directly with the city with any questions.

New Listing - 2175 35th Street, Sacramento, CA 95817

Stunning 3 bedroom, 2 bathroom, 1,903sf Med Center area Tudor style home! You will love the classic features and modern amenities in this painstakingly maintained property. Enter through the arched doorway into the formal living room, elegant fireplace with gas insert, inlaid wood floors, built-ins & tray ceilings. Large formal dining room. Updated kitchen features white cabinets, granite counters, tile backsplash, lots of storage, & breakfast counter. Family room off kitchen leads to serene and quiet backyard space with a great deck for entertaining and lots of sunny space to garden or play! Downstairs bedroom and full bathroom. Upstairs find 2 large bedrooms & huge remodeled master bathroom with dual sinks & huge closet! Central heating & air with separate remote-controlled units exclusively for upstairs. Freshly painted interior. Dual pane windows. Quarter basement. Detached garage with secure alley access. Located close to public transportation, UC Davis Med Center, shopping, restaurants, easy access to midtown and downtown, & more! Don't wait! MLS# 19046138. Offered at $599,900. For more photos and information please visit 2175 35th Street, Sacramento, CA 95817.

New Listing - 80 Riverknoll Place, Carmichael CA 95608

Welcome to the private gated Riverwood community in Carmichael. You will love how this 2 bedroom, 2.5 bathroom, approx 2,150sf home is nestled among an amazing tree canopy and lush manicured landscape. Come inside through the formal entry, and you will discover a spacious floorplan featuring a large living room with vaulted ceilings and a cozy fireplace. The living room and adjacent formal dining room look through a sunlit bank of windows to an expansive deck that truly integrate interior living space with the serene exterior. The updated kitchen offers something for everyone with gorgeous views of the outside, eat-in nook, lots of counter prep room and lots of cabinet space. The lower level features dual master suites, each with an ensuite bathroom and an abundance of closet space. All this with ample community amenities such as a pool and spa, and access to the American River and parkway. Close to parks, shopping, and more but in a secluded enclave far from the bustle of everyday life. Don't wait! Offered at $499,900. MLS# 19056380. For more photos and information, please visit 80 Riverknoll Place, Carmichael, CA 95608.

New Listing - 11100 Morgan River Court, Rancho Cordova, CA 95670

Location, location, location! A really special 3 bedroom, 2 bathroom, 1579sf Sunriver Rancho Cordova home is ready for a new owner. You will love the open spacious layout, separate living and family rooms, vaulted ceilings, updated kitchen with tile counters overlooks the backyard. Large bedrooms with lots of closet space. Laminate flooring. Central heating and air. Newer water heater. Section 1&2 pest clearance. Attached 2-car garage with brand new metal garage door. HUGE private quarter acre+ lot has lots of sunny space to garden or play. An outdoor oasis awaits with a built-in pool and spa. No rear neighbors! Backs to the Sunrise Recreation area section of the American River Parkway and its abundant recreation amenities - enjoy the river, bike trail, horse trail, hiking and wildlife. Also located just one block to Sunriver Park. Easy access to restaurants, shopping, Hwy 50 and light rail. Don't wait! Offered at $419,900. MLS# 19045555. For more photos and information please visit 11100 Morgan River Court, Rancho Cordova, CA 95670.

Featured in a CBS13 story about if the Sacramento real estate market is in a bubble...

I hate the word "bubble" as it relates to the real estate market. Bubble, to me, is a loaded term that implies that things may burst. Prices can increase without impending doom. I think memories and the wounds of the recession and home price collapse in Sacramento from 2005 - 2011 are still fresh in a lot of people's minds. They are in mine! But the past Great Recession and price freefall is not a persistent framework for what may happen in the future.

The Sacramento County median home price rose to $390,000 for June 2019, which is nearing the previous peak price from August 2005 of $392,750. And CBS13 reporter Rachel Wulff asked "is the bubble going to burst?" No. Will the market cycle at some point lead to stagnation? Sure. At some point. Watch the full interview here.

14 years ago, lending standards were so loosey-goosey you could fog a mirror and get a loan. Borrowers could lie about their incomes, or even about having a job! Borrowers could finance more than 100% of the purchase price and get cash back at closing. Borrowers could get negatively amortized loans and make a "minimum payment" like credit card, only for the principal loan balance to increase every month. Some industry professionals were ethically fast and loose. There was rampant fraud and speculation. It drove prices in an unsustainable way with several consecutive years of 20%+ increase in price. Yes, prices tanked, but should they have gotten that high to begin with? NO.

That was 14 years ago. As such, the regulatory pendulum swung the entirely opposite direction. Borrowers must have verifiable income, assets, credit scores and employment. Laws have changed in favor of consumer information and transparency. The bad industry professionals have been eradicated.

And now prices over the last 8 years from the bottom of the market have climbed back to near parity from their peak 14 years ago. Or have they? No, they have not. Think about how the value of money changes over time. EVERYTHING is more expensive than it was 14 years ago. A gallon of milk. A loaf of bread. The guy who mows your lawn. Electricity. Minimum wage. And house prices. As I note in the CBS13 story, inflation has also affected home prices. If you adjust the peak price of $392,750 for CPI inflation to today's value, home prices would have to climb overnight to $512,220 to be equivalent. We are far from that number. We are not even close to that number. (Side note: when I got my masters degree in public policy, adjusting for inflation was literally beaten into us as a way to compare like-for-like when doing analysis)

Another interesting metric worth pointing out -- more than double the number of Sacramento residents can afford to purchase a home now than they could back at the previous peak in 2005. According to the California Association of Realtors Housing Affordability Index, in August 2005, only 19% of Sacramento residents could afford a median priced home, while as of Q1 2019, that is 44%. Sacramento remains much more affordable relative to the state as a whole, which is at 32%. And WAY more affordable relative to the nearby bay area counties.

Comstock's Magazine did an article about past housing cycles in Sacramento earlier this year, linked here. Housing markets are cyclical. Ups and downs. Our past recessions have been more like slumps and stagnation rather than catastrophic avalanches of decline as we saw in 2005 - 2011.

So while I will not try to predict the future, what I can say is that markets do cycle. Every year for the last 5 or so years around the late-summer time the media freaks out that "this is it!" the sky is falling and prices are declining OMG panic in the streets crazy!!! Calm down. The market seasonally cycles every year. The spring is nuts, summer slows a little, picks back up over the fall, and slows again during the holidays. Then spring is nuts again. Every. Single. Year.

Ask me next spring if anything has changed. But is a bubble going to burst? NO. There I said it.

A Case Study: Zillow estimates of home value are NOT accurate -- but they pretend to be...

Over the last decade I have written several posts about the inaccuracy of automated website estimates of home value, and recently I noticed a situation with one of my listings I feel I must put out there for all to see. This is the perfect illustration of the current state of automated website estimates of value.

There are several websites out there that purport to be able to estimate home values, and the one most commonly referenced seems to be Zillow. Many of my clients love Zillow and often I hear "well Zillow says the value is $x". Admittedly, it's a cool website. It has robust search features and great mapping tools. But very rarely do I find that the value estimated by Zillow to be accurate, and often I have conversations with my clients about the disparity between reality and the Zestimate price. 

But what happens when a Zestimate is way off? It seems Zillow is now radically changing Zestimates based on property listing prices. Basically the way I interpret this, they are relying on an agent's assessment of value to adjust their own faulty estimate of value.

A few weeks ago, I listed a property for sale that I would call a major fixer. I had some pre-listing inspections completed, and it needed a new roof, had about $20,000 in dryrot and termite damage, and was cosmetically in rough shape and very dated. After analyzing comparable sales I suggested a listing price of $225,000. The house went on the market July 10th, 2019. 

 

I happened to look at Zillow that afternoon, and noticed the Zestimate was WAY higher than the listing price at $291,413. That is a substantial difference of $66,413 --over 20% more. Now, if this property were to have been in stellar condition, it would be closer to the value of the home...but this home needs major renovation.

I tweeted about this price difference, noting the significant difference and that Zillow posted a little disclaimer. I got several offers on the property and the seller accepted one later in the week. My seller was really pleased as the listing price of $225,000 I suggested was more than she figured the value would be given the condition of the property.

Then on July 21st, I happened to look at Zillow again. I was shocked to see that practically overnight Zillow had lowered it's estimate of value to $225,001.

WOW. There are so many things I that irritate me about this. 

(1) So now does Zillow get to claim accuracy for its Zestimate for this property? It closed on Tuesday of this week, July 23rd for $226,000. For what it's worth, I did have some higher offers, however the seller selected an all cash and completely non-contingent offer (meaning no loan, no formal appraisal, no inspections) with a very quick close. 

(2) I believe the new owner plans to do a major remodel and then resell the home. I'm sure he will be thrilled to have what will then be a ridiculously low Zestimate for the property when it eventually goes back on the market. Or will Zillow substantially change the value again at that time?

(3) Is Zillow going to freak out nearby homeowners and potential buyers when they see the "Last 30 Day Change" on this property is -$62,682? Do people trust Zillow so much they will falsely think the market is crashing in this neighborhood? (Coincidentally, can Zillow even do simple math? I noticed $225,001 + $62,682 is $287,683, which is $3,730 less than the Zestimate from 11 days prior.) 

Anyway, people, PLEASE realize that this website has nothing on licensed agents and appraisers who know the market, can see the property, and accurately estimate value. If you would like an accurate estimate of your home's value, call me and I can help you. Or I can connect you with a licensed appraiser who can also help you if your situation calls for that.

New Listing - 970 Marvel Stripe Terrace, Davis, CA 95616

Better than new 2 bedroom, 2.5 bathroom tri-level home in the highly-sought after Heirloom at the Cannery Davis! You will love the gourmet kitchen with granite countertops, subway tile backsplash, and stainless steel appliances. Amazing covered patio terrace off the kitchen brings the outside in. Downtstairs bedroom and full bathroom built to ADA standards. Large upstairs master suite has a walk-in closet, en-suite bathroom with dual sinks and stall shower. Laminate floors throughout, inside laundry, 2 car attached garage. Energy efficient features include tankless water heater, EV plug-in ready, and owned solar so you'll enjoy maximum comfort and minimal energy bills. The Cannery boasts abundant walking trails and parks, outdoor gym equipment, and an urban farmhouse style club with massive heated pool, hot tub, fire pit, BBQ areas, and game room. All this located within a bike-friendly Farm-to-Fork community! Conveniently located near shopping, downtown Davis and the UC Davis Campus! Don't wait! MLS# 19045861. Offered at $515,000. For more photos and detail please visit 970 Marvel Stripe Terrace, Davis, CA 95616.