After years of rising home sale prices, the Sacramento region could be seeing the first signs of a decline. The highest average prices recorded were $405,000 in June 2018. Since then we have seen a steady decline.
The median home sales price in the Sacramento region fell by 5 percent last month compared to December, one of the steepest declines seen in large metro areas across the country, according to the latest data by the real estate brokerage Redfin.
The question lurking in the back of the minds of many realtors: is this just a seasonal dip or a long-term trend?
The thing to keep in mind is we have seasonal dips in our market — things slow down at the end of the year through the beginning of the year so whether or not the dips we’re seeing are significant ones or if they’re seasonal ones remain to be seen.
For Sacramento County alone, Sacramento Association of Realtors data shows the dip in prices was around 3 percent.
Prices in the region remained near a record high. However, the market has shown signs lately that the upsurge is wavering. The decline comes as the volume of home sales in the region has also softened, falling by more than 19 percent in January compared to December. In perhaps another sign of the market cooling, home sales were down nearly 22 percent compared with the same period the year before.
Compared with other metro areas on the West Coast, the $369,000 median price in Sacramento was only slightly above average, with places like San Jose and San Francisco still at the top of the pack with median prices upwards of $1 million.
Phoenix, Los Angeles and Denver recorded the most homes sold in the West, while Fresno, San Francisco and Oxnard, Calif. recorded the least.
Interest rates and inventory will determine if the housing market shifts from being beneficial to sellers to a ripe opportunity for buyers. Interest rates, in particular, have a direct effect on affordability because they often make or break a loan.