Wednesday, March 10, 2021

February 2021 - Sacramento pandemic housing market statistics, inventory, home prices, etc...

Spoiler alert: if you are thinking about selling your Sacramento area home, the market is very much in the seller's favor at this moment. 

We are now nearly one year into the COVID-19 pandemic. Wow, where did the time go?? It seems like yesterday and way too long ago that things were "normal"...but what is our new normal looking like a year in?

Just how is the Sacramento real estate market doing a year into the pandemic? I answer this question for my clients every day. In short: the Sacramento market has been heated, prices have climbed significantly, and inventory of homes for sale is so low that many homes are getting 10+ offers because buyers descend on listings like locusts. 

The really low 3%-ish interest rates, people highly valuing different uses of space, and newly discovered mobility and ability to work from home from any location has lead to high home buyer demand in Sacramento. Couple that high demand with the fact that many would-be sellers have hunkered down during the pandemic and not listed their homes, this combination has lead to increased prices. 

You can see in the graph that there's literally HALF the number of listings on the market today as there were a year ago, right before the pandemic started. The graph is a stunning illustration of the supply and demand of the current Sacramento housing market. You will see that in June, July, August, September, October, November, December, January and February there were MORE homes that went into contract (dark green bar) or sales that closed (red lines) than the number of homes available. The fact this dynamic has persisted for so long is shocking.

The effect on price has been significant. From February 2020 to February 2021, according to Trendgraphix, the median home price in Sacramento County has increased 16.1%, from $398,000 in February 2020 to $462,000 as of the end of February 2021. 

Multiple offers abound, homes selling for more than listing price, prices increasing. But if you dig into the dynamics and data it makes a lot of sense. I wrote about Sacramento real estate market dynamics in July 2020 and November 2020 and the housing market trajectory in Sacramento has remained the same.

As we approach the spring, usually we see a lot of new listings hit the market. I do think we will see more listings come onto the market, but there is a persistent buyer demand that I believe will gobble up the new supply of resale homes that hit the market. I personally have several would-be seller clients who were ready to list their homes before COVID-19 hit who are watching closely to see if Sacramento County moves to a more favorable tier, if vaccines are more widely deployed before they re-evaluate if they feel safe to have showings and people in their homes. And I also have a growing list of clients who would love to sell, however they have not been able to find another home to purchase, and hence these clients have not listed their homes for sale.

I am still listing plenty of properties -- folks still need to move, whether relocating out of state, or moving to different school districts, or moving closer to work, finally getting that home with a pool they always wanted, or upsizing to have a home office, or downsizing after the kids move out, or selling an empty home in a living trust or probate estate, etc. 

What I can say is -- if you are thinking about selling your Sacramento area home, the market is very much in the seller's favor at this moment. It may be an opportune time to take advantage of the seller's market right now. If I can help, I welcome your call or email to see if we are a fit to work together.

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