Linked above is one of the three sources I have read concerning the increase in home prices in May for the Sacramento region.
The Sacramento Association of Realtors reported that the median price in Sacramento County increased by 7.7% from April to May. Their report highlighted that 25% of sales were for cash compared to just 10% a year earlier.
The Sac Bee article above had the median price increases ranging from 4% to 15% for the counties in the region. May was the 14th straight month of year over year sales numbers gains. Big news was the drop of foreclosure sales from 71% of total sales January to 59% in May.
Mike Lyon’s Trendgraphix report had a 7% sales number decrease from May 2008 for the 3 county region they track. The inventory of available homes was 45% lower than the previous year. Good news on the pricing front. This report tracks median per square foot prices and they increased by 2% to 9% for the 6 counties in the region.
All of the above reports are good news for sales numbers and prices in the region. Visible inventory is now less than 3 months supply which should further push up median prices. Of concern is the shadow inventory of properties held by banks and homes currently going through the foreclosure process. This unknown number of homes for sale could again depress prices.
Let me make a prediction here: The sales over the last year have been in the smaller homes selling for well below $200k. The shadow inventory may be populated by larger homes with bigger mortgages and the banks will be reluctant to unload them at the prices we have seen over the last 6 months. I think the shadow inventory will be trickled onto the market and provide just enough inventory to continue to push up the median price range.