Market price

Sacramento, California, real estate market: lower prices, fewer sales

The Sacramento area real estate market is cooling faster than almost any other region in the country.

The Sacramento area real estate market is cooling faster than almost any other region in the country.

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The Sacramento real estate market is experiencing a summer chill – or is it getting back to normal?

New data released this week shows the Sacramento-area market is cooling faster than any other metro in the country except San Jose. That’s according to Redfin, the national real estate company, which analyzed “year-over-year price changes, price drops, supply, pending sales, sale-to-list ratio and share.” homes that were taken off the market in two weeks from February to May” to determine its ranking.

Oakland, Seattle and Stockton are other areas where real estate markets are cooling.

A separate Redfin analysis showed that around 49% of property listings in the area in June had a price drop. It was the sixth highest percentage in the country. Many markets with large shares of homes with a price drop were popular destinations during the pandemic, including Sacramento, Boise, Idaho, Salt Lake City and Tampa, Florida.

“Higher mortgage rates and a potential recession are causing would-be home buyers in popular migration destinations to press the pause button, and they’re also having a big impact on workers in major job centers who are relying on their wallets. ‘shares for installments,’ Redfin Senior Economist Sheharyar Bokhari said in a company blog post.

Redfin described Sacramento and other domestic markets as “pandemic boomtowns” that are experiencing dramatic shifts. In Sacramento, prices have jumped more than 40% since 2020, but price increases have started to slow.

Local real estate analyst and appraiser Ryan Lundquist found similar evidence of a change. Homes are staying on the market longer, the inventory of homes available on the market is increasing and the number of sales has dropped, he found.

“In short, many metrics are hovering around normal or near normal levels at the moment, so I can understand when people say the housing market is normalizing or trying to find a balance,” Lundquist wrote in a blog post. . “It’s like we’ve been on honeymoon for two years, and now it’s real life instead of an endless mai tai vacation vibe.”

Lundquist also found a significant number of listings with price drops. He said 43.7% of active listings last week in the region had a price reduction. There have been a lot of big price drops in the market; about 11% of listings suffered a reduction of more than $100,000, according to Lundquist.

The median price of a home in the Four Counties area was $610,000 in June, according to Lundquist data. That was down $15,000 from the median price in May, an indication, Lundquist wrote, that “prices are softening.”

The most expensive real estate remains in Placer County, where the median price was $715,000 in June, according to Lundquist.

This story was originally published July 14, 2022 10:48 a.m.

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Ryan Lillis covers housing, real estate and development for The Sacramento Bee. He has been a reporter at The Bee since 2006 and previously covered Crime, City Hall, Wildfires and the Central Valley, and was the Associate Editor. Originally from upstate New York, he graduated from the UC Berkeley School of Journalism.