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As prices fall, July home sales hit 11-year lowBy Jim Wasserman - Bee Staff WriterLast Updated 12:14 am PDT Thursday, August 16, 2007 It was two years ago this month that some housing experts began seeing the first signs that the Sacramento region's housing boom had begun to peak. "The bell has tolled," said Lyon Real Estate owner Mike Lyon in August 2005, declaring that the era of skyrocketing home values and sales may have hit its high-water mark. Ever since, the ride for Sacramento's housing market has been bumpy and it got no better last month, according to statistics released Wednesday by DataQuick Information Systems. The Sacramento region's 2,906 closed escrows in July 2007 were the lowest for a July in 11 years. Sacramento, Placer and Solano counties also showed some of California's biggest declines in median sales prices from the same month last year. Given that trend, Lyon today believes "this real estate market is going to be lackluster until around the end of 2009." July's buyers of new and existing homes in Amador, El Dorado, Nevada, Placer, Sacramento, Sutter, Yolo and Yuba counties fell short of the 3,217 sales reported in June. July's tally included 2,104 resale houses, 74 resale condominiums and 728 new houses. Among those handed keys is first-time buyer Robin Davis of Sacramento, who is enjoying her first weeks in a $250,000 three-bedroom, two-bath house. "I'm just totally pleased with my loan payment," she said. It's about $1,000 a month and fixed for 30 years, courtesy of government loan programs still in place despite recent credit tightening in other mortgage sectors. Real estate experts say July is typically one of the year's biggest months for escrow closings. But this year, sales tallies in urban areas -- in Sacramento, the Bay Area, Los Angeles and San Diego -- have fallen to mid-1990s levels. DataQuick President Marshall Prentice said the sales declines represent a "post-frenzy rebalancing act." In a statement he said, "These are interesting times because the slowdown in home sales isn't part of a broader economic slowdown." Sacramento's last housing bust, from roughly 1991 to 1997, played out amid a statewide recession, significant job losses and the closings of Mather and McClellan Air Force bases. Sacramento's newest economic snapshot is due Friday from the state Employment Development Department. In June, Sacramento-area unemployment -- Sacramento, Placer, El Dorado and Yolo counties -- was 5.2 percent with the commercial, industrial and office construction sectors remaining strong. Nonetheless, Sacramento, Placer and Solano counties in July showed some of the state's biggest year-over-year median sales price declines. Prices fell a record 10 percent from last year in Sacramento County, 8.5 percent in Placer County and 9.8 percent in Solano County. By comparison, most Bay Area counties are still seeing higher prices than July 2006. The worst year-over-year decline in Southern California was 5.1 percent in Ventura County. The median is a point where half sell for more and half for less. Placer County has now seen 15 consecutive months of year-over-year median price declines, according to DataQuick. July's $430,000 median sales price for all homes is 18.2 percent below the county's December 2005 peak of $525,000. Sacramento County, likewise, has seen 14 months of year-over-year median price declines. Its current $324,000 median sales price for all homes is down 16.3 percent from a peak of $387,000 in August 2005, according to DataQuick. Even Yolo County, which in May showed its first positive gain in 10 months when median prices were 4.4 percent higher than the same time last year, took a hit in July. Yolo's median prices were 6.9 percent lower than in July 2006. The brightest picture was in Sutter County where the median sales price of $290,000 was 2.8 percent higher than July a year ago, the first year-over-year gain for the county in 11 months. July 2007 ended with a record inventory of 15,927 houses for sale in El Dorado, Placer, Sacramento and Yolo counties, reported the Sacramento property research firm TrendGraphix. In the past two years, "The inventory (of houses for sale) has more than doubled and the (sales) transactions have halved," said Lyon. Sales prices of existing homes in Sacramento County -- the region's biggest housing market -- have eroded back to December 2004 levels. Like other inland zones in California where new housing boomed, the capital region is seeing some of its biggest price declines in newer suburbs. Last weekend, Texas-based home builder D.R. Horton boasted a "$15 million giveaway" of discounts and financial incentives for its Sacramento-area developments. In its Mirasol community in Lincoln, sales manager Jennifer Mallory reported three sales last week. All of the homes had dangled $40,000 discounts to buyers as builders contend with an excess of supply. About a mile away, Rocklin real estate agent Maxine Sunada toured a client through existing homes on Alder Creek Court in Lincoln. There, six of the street's 18 houses -- built in 2004 and originally priced in the $500,000s -- were for sale. Many had dead lawns and two bore signs saying "bank repo." Prices ranged from $429,000 to $459,000, a drop of about 10 percent to 15 percent in three years. "People bought in the $500,000s and the values went down," said Sunada, who saw a similar boom-and-gloom cycle in the 1990s. "They get divorced, lose a job. It's what happens." |
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