Is the sky falling in the real estate market? Despite all the chicken little headlines you might be hearing in the media, it’s not! We’re not at the cusp of a real estate bubble like in 2008. The recent data for Sacramento, Placer, and El Dorado counties shows that the market is decelerating, but it remains strong. We’re a long way from a crash. Let’s take a look at the numbers.

The first chart at 0:52 in the video shows that we had quite a spike in inventory. We went from 2,483 homes in our area in May to 3,311 in June, which is a 33% increase. This is partly just a seasonal increase, but it was also caused by sellers who rushed their homes to the market, thinking it would crash soon.

The chart at 1:20 in the video shows the average price per square foot, which also saw a small drop. It went from $359 in May to $352 in June. This is an expected change. As more inventory hits the market, the price per square foot should flatten.

We’re a long way from a crash.

The graph at 1:45 shows the list-to-sold ratio, which still sits at 100%, which means that homes are still selling for the list price on average. The average days on market has also increased by three days since May.

The last chart at 2:10 shows that our inventory has climbed from 1.1 months in May to 1.7 months in June. Looking at this shift, you might think that the market has already changed, but remember that zero to three months of inventory is a seller’s market, four to five months is neutral, and anything over five months is a buyer’s market. It’s still a strong seller’s market.

What does this mean if you’re buying a home? You’ll have more options, sellers will offer more concessions, and interest rates are still relatively low. If you’re selling a home, keep in mind that homes are still selling at or above their list prices if they’re priced right. The market is adjusting slightly, but there’s no reason to panic. Prices are still high and expected to climb, but they won’t increase as quickly as they have been. 

If you have any questions, please feel free to call or email us. We would love to help you.