It’s Time to Lower Mortgage Rates
Standing inventory rests 21% lower than last year.
(SACRAMENTO, CA) – The number of active and available homes for sale throughout the Greater Sacramento Region declined by 6 percent during the month of November and rested a notable 21 percent lower than last year at this time. New listings posted over the past three months fell 11 percent short when compared to the same period last year as both buyer and seller lethargy continued to permeate the market. Consequently, the market still remains in a modern day “state of balance” with slightly more than two months of supply based upon the current rate of sales. Historically speaking, 4 to 6 months has often been viewed as the “balanced market” range.
A total of 1,231 resale homes went under contract as new pending sales, while 1,096 were posted as sold and closed across the entire region for the month of November. These sales categories reflected 6 percent and 21 percent drops respectively compared to October, which is not unusual for the season. These metrics though are much lower than average due to the jump in mortgage interest rates over the past two years. A more relevant comparison may be the fact that new sales and closed escrows track 40 to 45 percent lower than those in pre-pandemic November of 2018 and 2019.
According to Pat Shea, President of Lyon Real Estate, “We experienced an extraordinary economic and real estate boom during the pandemic and now must continue our journey through a market correction. Until rates fall a percent or so, many potential home sellers and buyers alike will continue to hold off.”
The average closed sales price rested at $659,000 and the median sales price at $575,000 for the region in November. Both measures are approximately 4 percent higher than last year at this time. “We saw some quick and significant price jumps first up and then down during that volatile pandemic period,” says Shea. “This year our market has found more equilibrium. Home prices are following a gradual growth process more typical of what we deem normal in and around Greater Sacramento.”
“Currently the only homeowners who might be feeling a little bit of financial pain are those that purchased and financed over the past 24 months,” Shea adds. “Yet most homeowners stay in their property for at least 7 years and can always refinance. Mortgage interest rates will soften and prices will remain on an upward trend. The FED has already ceased their hikes and many experts are projecting rate drops to commence in early 2024. The job market remains solid and people are eager to sell, buy or both. They have waited long enough so expect our housing market to get busy again in the New Year”.
Download the MarketUpdate_November2023.
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 700 agents in 16 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 $1,368,365 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.