If You List It, They Will Come
Low inventory continues to stifle the resale housing market
Last year at this time, home sales throughout the Greater Sacramento region maintained a multi-year red-hot pace. That phenomenon failed to ease up until the third quarter when rapid mortgage interest rate increases were implemented to douse the flames of inflation. The rapid rate increases as well as quantitative tightening steps by the Federal Reserve Bank, ultimately slammed the brakes on record-setting sales figures and double-digit price appreciation that was rampant across the country.
“This year we will see an ongoing struggle to climb back to a normal and balanced market,” says Pat Shea, president and CEO of Lyon Real Estate.
Specifically, 3,537 homes closed escrow in the first quarter, which was a whopping 37 percent fewer than the same time period in 2022. New open escrows for the quarter, however, were only 31 percent lower than last year’s reported numbers and indicate an uptick may be getting underway. Despite news of revived buyer demand, year-to-date new listings entering the market are still underwhelming, tracking 42 percent lower than 2022. Even with evidence of increased buyer enthusiasm, the low level of inventory and meager new listing activity are continuing to stifle sales. These combined sales metrics have once again left a meager 1 month of inventory currently available on the open market.
The average sales price for homes that closed in March rested at $631,000. This metric was down approximately 9 percent year over year yet jumped 5 percent versus February. It also reflected the third straight month of increases since falling to a recent low of $586,000 in December. Sellers received approximately 97 percent of original list price and were on the market an average of 49 days. “These numbers also improved compared to those of recent months and further suggest the market is indeed trying to break out of its shell,” says Shea.
The upper-end, those properties priced at $1 million dollars and above, bounced back impressively in March with 126 closed sales, double those of February. New open escrows were 50 percent greater than those of February and both new listings and total inventory remain quite healthy in that important market segment. It is still common to see all-cash offers as well.
Shea offers that: “Most market analysts expect home sales to continue to rebound throughout Greater Sacramento with typical seasonality likely to surface again at year-end. Many prospective sellers have been reluctant to take action post the heavy-handed shock to the economy leveled by the FED. Yet, multiple offers are still occurring on many properties though sellers do want to price appropriately and place their homes in optimum showing condition. New mortgage holders can always refinance if interest rates further improve, much like they did when rates trended down during our recent market boom. A reputable real estate professional can paint a very clear picture of the market and a clear path to help people comfortably achieve their home ownership and lifestyle goals.”
This market information was presented by Lyon Real Estate based upon data provided by Trendgraphix Inc., a Sacramento-based reporting company.
About Lyon Real Estate
Lyon Real Estate is the leading independent real estate brokerage company in Greater Sacramento (Sacramento Business Journal). We are proud to be homegrown, privately owned, and internationally known. Lyon has served the area for over 75 years. Last year, the company closed a total of 4,236 transactions and $2.55 billion in sales volume. Lyon Real Estate has over 800 agents in 17 offices located throughout the region. The company is a member of the Leading Real Estate Companies of the World®, the largest network of premier locally branded firms, as well as LeadingRE’s Luxury Portfolio International® program. In addition to its real estate services, Lyon Real Estate offers RELO Direct, a global relocation program. Since 2015, the Lyon Cares Foundation has contributed more than $1,209,365 to local nonprofits.
About TrendGraphix, Inc.
TrendGraphix, Inc. is a real estate data analytics company based in Sacramento that uses local Multiple Listing Service (MLS) data. Trendgraphix provides highly-visual performance and market statistical graphs to real estate brokers, agents, and MLS/Realtor associations across the country. TrendGraphix’s programs are currently used by tens of thousands of brokers and agents in more than 300 brokerages across the nation. For more information about TrendGraphix, visit www.trendgraphix.com.