More Homes for Sale

Last month in my analysis of market conditions I predicted we would see a modest increase in the median price paid in the Greater Sacramento area, higher sales volume and a modest decline in the inventory of homes available for sale. I was right about price and volume (see this month’s report) but way off with my prediction of a decline in inventory. If I had been looking at Housing Tracker, I might have made a better forecast. Not exactly the same four county area but clearly large percent of the area is included in this weekly report.

According to Housing Tracker, as of March 14 the available homes for sale in the Sacramento area was 7,822 which is up 103 from the end of February. Inventories of homes on the market are slowly increasing all across the country. This is all part of an adjustment period needed by the market to balance for slightly higher rates and a market that has lost some steam. The National Association of Realtors calls this, “normalizing of the market.”

David Lereah, NAR’s chief economist, says, "The cooling from overheated sales conditions in recent months is helping to bring inventory levels up to the point where buyers have more choices than they’ve seen in the last five years. Annual price appreciation is still running at double-digit rates, but the cause of those sharp increases is going away. As the market readjusts, price appreciation should return to more normal rates of growth this year.”