Tag Archives: Whitney Ranch

Beautiful Whitney Ranch Home

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This beautiful Whitney Ranch home can be yours! One of the most desirable floorplans, features a bedroom & full bathroom downstairs – great for guests, 3 bedrooms and a loft upstairs. Luxurious hardwood floors through most of the down stairs. Formal living and dining room areas, plus a family room. The kitchen includes upgraded cabinets with nickel knobs, a full backsplash with designer tile accents, and solid surface counter tops that never need to be sealed. The backyard was recently redesigned; and is great for water conservation. Just across the street is a lovely cul-de-sac; and a short walk to the local neighborhood park. Whitney Ranch is home to award-winning Sunset Ranch Elementary and Whitney High. Enjoy the benefits of the Ranch House with pool and clubhouse.

1st Open House Saturday, March 27, 2015 from noon to 4 PM. Stop by and see us.

Real Estate Market Trends: Placer County

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After a booming 2013, the Placer County real estate market has been somewhat subdued so far this year. While actual sales are down each month this year compared to 2013, the larger impact has been the increase in available homes for sale.

In July 2013 there were 930 homes available for sale in Placer County compared to 1454 in July 2014. Closed home sales were at 583 in July 2013 vs. 528 in July 2014. Perhaps the good news is that pending sales were up with 488 home gone pending in July 2013 vs 586 homes pending in July 2014.  The real estate activity in Rocklin, Roseville and Lincoln is also in line with Placer County.

The pendulum is always swinging and what I believe we are seeing is a somewhat typical transition to a normal market. 2013 was so strong that it is reasonable to see the pendulum swing in the other direction. In fact, it’s probably a good thing when you think of the alternative being a run-away market with prices escalating and pushing us into another bust cycle too early.

Of course, all this data is generalized. Lower priced homes have maintained momentum better than higher priced homes, as is to be expected. In addition, the change on January 1, 2014 in the maximum FHA loan limit (dropping from $580,000 in 2013 to $474,950 in 2014) took a hit on home prices mostly in the $500’s.

To further challenge the market, many home sellers expect to be able to sell their home for more than the neighbor’s home that sold earlier this year. While this may be appropriate in the $250K price range, we have seen little or no price appreciation this year in the $400,000+ market in 2014. So these homes hit the market overpriced and ultimately the prices must be reduced to market level. It doesn’t necessarily mean that home prices are declining, but it does infer that if you want to sell your home in today’s real estate market, you must price it using good comparable properties and not shoot for “pie in the sky dreams.”

The remainder of 2014 will give us a good idea of how the selling season will take off next year. I expect that we will see sales pick up over the next few months and will likely drop off over the holidays. By February 2015 I expect to see inventories start to drop again and that we will see marginal appreciation next year. The one wild card is whether or not interest rates stay low. A 1% increase in interest rate will put pressure on home values since this will push buyers into lower priced homes.

Hope this gives you an idea of where our local real estate market trends are heading.

To see charts for Placer County as well as Roseville, Rocklin, and Lincoln, please click on this link:    Real Estate Market Trends for Placer_Rocklin_Roseville, Lincoln

Real Estate Market Trends – Rocklin, Roseville, Lincoln

trend chart_012014 As we approach the 2014 selling season, I’ve received questions about how this year will unfold compared to the banner year we had in 2013. In a normal market, the main selling season runs from about February through May or June. Last year we experienced a strong market that carried over from 2012. Prices increased substantially, inventory levels were extremely low, and it was common to see homes selling in the first week of being listed with multiple offers; many offers above the asking price.

As prices have risen, more homeowners are now sitting in equity positions. Many wanted to move but sat on the sidelines waiting for the opportunity to sell their home as prices rose. In June/July 2013 interest rates jumped up. That event, and the fact that we were exiting the selling season, slowed market absorption. In the 2nd half of 2013, many owners put their homes on the market after the run up in prices. In many cases, these homes were priced with the assumption that prices were continuing to increase every month as was experienced in the first half of the year. Where does that leave us?

Every area is different. Lower priced homes in Placer and Sacramento Counties continue to see high demand and low inventory. However, homes in higher priced areas are trending toward (or perhaps are already in) what is typical of normal market conditions. In higher priced areas, home appreciation has been very subdued over the last six months. These homes are not seeing multiple offers as they did one year ago, it’s taking much longer to sell those homes, and inventory levels are up.

Don’t get me wrong. I’m not saying the market is declining. But I am saying that indicators point to higher inventory levels in 2014, slower price appreciation, and sellers should expect that it will take longer to sell their home than it did in 2013; unless the home is in the lower priced areas or offers something highly desirable and considered a one-of-a-kind offering. Those owners who are considering selling their home will do well to find an excellent real estate agent who will guide them in pricing their home appropriately. Otherwise, “frustration” may be the word of the day.

Below I’ve included some charts for the 95765 zip code. This demonstrates where we are in the market now as we approach the selling season. If you would like to view charts on other surrounding areas, please visit our website: www.quarantarealestate.com. Click on the Market Trends Reports in the left column. If you have questions about these or other areas, feel free to contact us.  And remember, Real Estate Market Trends are fluid and can change on a dime.
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FHA Lowers Maximum Loan Amount

FHAI’ve had several people ask me about the change in FHA loan limits and what impact it may have on home buyers and home sellers. Up until December 31, 2013, the maximum loan amount that a borrower could receive under FHA was $580,000 for Sacramento and Placer counties. Starting in January 2014 the maximum FHA loan amount is now $474,950 for FHA in the same areas. The only exception to the new loan limit is if a home was assigned an FHA case number prior to the end of 2013. FHA gave little notice of this change with a formal announcement occurring in early December 2013.

FHA doesn’t make loans but does insure lenders against defaults that have been funded using FHA. There are many reasons why a buyer may choose to use FHA as a method of financing a home.

• Only 3.5% down payment (with max loan of $474,950)
• Lower FICO score requirement than Conventional Loans
• Higher DTI (debt to income ratios) allowed vs Conventional
• After short sale, able to purchase sooner than Conventional
o FHA has a “back to work” program that allows qualifying buyers to purchase a home 12 months after a short sale.

How will this affect the market is unclear at this point in time. Homes priced under $500,000 should experience little negative impact. However, homes selling in the mid $500,000 range and up could be negatively impacted if FHA is heavily used in the area. Some home buyers who must use FHA may have to reduce the purchase price they have been considering.  This could negatively impact demand for higher priced homes.  If we see strong demand, the change in FHA loan limits may have little impact.

We’ll have to see how the selling season unfolds in the coming weeks to ultimately understand the impact of the change in FHA loan limits. In the bigger picture, the overall real estate market is moving toward equilibrium. Communities with higher priced homes are seeing slower appreciation and some increase in inventory leading to a balanced market. Lower priced homes will likely continue to be in a seller’s market in the short term. Most experts suggest that home prices will continue to increase in 2014, though not at the rate we’ve seen over the last few years. Instead, they are predicting an appreciation rate of around 6%. Interest rates by the end of the year are expected to be somewhere between 5% and 6%. If you would like to find out what the maximum FHA loan limit is for your area, click the link below.
https://entp.hud.gov/idapp/html/hicostlook.cfm (all you need to do is put in the county and hit send).

Contact me if you would like more information. Hope that helps!

ANOTHER HOUSING BUBBLE?

New Housing Bubble Coming?

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Another Housing Bubble Coming?

Are we entering another real estate market “bubble?” Some folks I talk to believe that prices have risen too quickly and that it will all come crashing down again.  Recent history will tell us that no one knows what the future holds in this regard.  Pricing in the market is one factor for consideration, but the strength of the market is determined by much more.  Not only can our politicians make new  laws with unintended results, but major catastrophic or world economic events can affect the US real estate market.  Here are some facts to help you decide where we are in the real estate cycle.

While prices have risen dramatically over the last year, they are nowhere near the highest prices that were  seen just prior to the downturn.  Many areas have seen 20%+ appreciation over the last year which is driven by demand.  I don’t expect us to see appreciation continue at that rate over the next year because of several factors but it will be a while before we see equilibrium between supply and demand.

ALL loans available today require documentation of a buyer’s ability to repay the loan.  Lenders require much more information from buyers today before approving a loan.  Long gone are the stated income loans (aka: liar loans) that allowed buyers to merely pull numbers out of a hat to qualify for a home loan (of course, that doesn’t mean they won’t come back).  When I was VP of Sales for Lennar’s Northern California Division, I can’t tell you how many times buyers made loan applications with our “in-house” lender and were declined; only to have the buyer return with a stated income loan approval from another lender.  Hmmm, let me see; did their income go up in just few short days? The point is that loans originated today are more sound and more likely to be repaid than in the past.

Most local market areas have  1.5- 2.0 month’s supply of inventory of homes for sale. A market in equilibrium between supply and demand will have 3-6 months of inventory available at any time.  In other words, if there were no additional homes placed on the market for sale, it would take 3-6 months to sell everything that was currently available.  We are seeing a trend toward equilibrium but we are still in a seller’s market and it will likely be several months before supply and demand are equal.

Short sales and foreclosures as a percentage of total sales are way down.  These sales tend to sell at lower prices.  So one reason that median price has increased is merely because there are fewer short and foreclosure sales in the market.  In addition, this demonstrates that the market is building real strength.

Interest rates are up 1% or more since the beginning of the summer.  This will tend to push home sales toward equilibrium in a seller’s market.  Rates will likely creep up over the next 12 months, however, it is expected that rates will stay relatively low compared to historic highs.

While short and foreclosures sales are down, traditional sales are up. Why? Because the price increases we have seen in the market allow homeowners to sell their homes without credit impairment and in some cases, actually making a few bucks along the way.  And most of these sellers will be new buyers in the market.

While there are many external factors that can affect the stability and strength of the real estate market, there is no evidence, at this time, that would lead us to believe we are in a “bubble” or even close to being there.  As more inventory comes into the market, the rate of home price appreciation is slowing yet demand is still strong.  Barring unforeseen circumstances, there is every reason to believe that we are headed toward a more stable market with reasonable price appreciation and inventory. In other words, we are heading in the direction of equilibrium, not of another crash.

Steve Quaranta
Better Homes and Gardens Real Estate

Local Real Estate Statistics

Sac chart July 2013

Sacramento County

**2371 homes available for sale in July 2013 vs 2019 in June 2013 (up 17.4%) and 1686 in July 2012 (homes for sale up 40.6% year over year).
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1559 pending sales closed escrow in July 2013 , vs 1510 from June 2013 (up 3.2%) and 1661 in July 2012 (down 6.1%).  
**Average days on market for July 2013 were 26, vs 23 for June 2013, and 60 for August 2012.
**Months of inventory – 1.5 months of inventory in July 2013 vs 1.3 in June 2013 (up 15.4%) and 1.0 in July 2012 (up 50%).

Placer County

**930 homes available for sale in July 2013 vs 795 in June 2013 (up 17%) and 784 in July 2012 (up 18.6% year over year). 
**565 pending sales closed escrow in July 2013 vs June 2013 of 578 (down 2.2%) and July 2012 of 507 (up 11.4%).
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Average days on market for July 2013 were 28 vs 30 for June 2013 and 61 for August 2012. 
**Months of Inventory – 1.6 in July 2013 vs 1.4 June 2013 (up 14.3%), and 1.5 in July 2012 (up 6.7%).

WHAT DOES THIS MEAN?  Inventory of available homes is up substantially as more sellers are able to now sell and avoid a short sale or foreclosure.  However, many of these new listings are overpriced in the market which will trend to longer days on market.  Sellers (and some real estate agents for that matter) have not recognized that the market has experienced a shift starting in June of this year.  With prices increasing every month through the first half of the year, it did not take long for the market to catch up to an overpriced listing.  This is no longer the case. 

However, demand still outpaces supply and homes priced correctly in the market and that lack any substantial flaws will sell in a reasonable period of time.  3-6 months of inventory is considered to be a “normal market” where supply and demand are in equilibrium.  Remember that closed escrows in any given month became pending sales (in most cases) 30-60 days prior.  July closing statistics include homes that became pending sales in May and June.  Average days on the market is trending higher as more homes are listed on the market for prices not supported by demand.   The summer months are typically slower sales months as people take vacations and prepare to get their kids back in school.    Some of these statistics are likely attributable to the seasonal summer slowdown.  Activity in September and October of this year will help us understand how much of the market shift will continue and how much was merely affected by seasonal factors. 

 Frequently we see conflicting reports in the news about the real estate market. Part of that may be due to the area being reported on; national, state or local.  I just read a article stating that California home sales were the highest in July since May 2012.  I would expect this given that we have seen increased inventory in the market over the last few months.  The buyers in the market who have not been able to purchase a home until now are finally getting a break with more homes on the market and prices stabilizing. 

To see the detailed charts for this information and more please visit our website.  CLICK HERE!

If you like this article please share with friends and on social media sites.  And if you would like additional information or help you can contact me at:

916-276-7653

SteveQ@TeamQ-RE.com

INTEREST RATES JUMP 1%!

rising interest ratesAfter Fed Chairman Ben Bernanke’s address last week, stocks dropped and interest rates increased.

As recent as a month ago, it was still possible for a home buyer to purchase a home with an interest rate of between 3% and 3.5%. Today, rates are generally floating around 4.5% or higher. In the big picture of housing interest rates, 4.5% is still an excellent rate, but we’ve all been spoiled in recent years and this change does impact the housing market. Let’s take a look at how this rise in interest rates is affecting the purchasing power of potential homebuyers in the marketplace by way of an example.

Let’s say that a buyer is qualified to purchase a home priced up to $400,000, assume that the buyer is putting 10% down and then look at payments under two interest rate scenarios as follows:

Purchase Price: $400,000
10% Downpayment: $ 40,000
90% Loan Amount: $360,000

Monthly Principle & Interest Payments
At an interest rate of 3.5% : $1617
At an interest rate of 4.5%: $1824
Increase in Monthly Payment: $ 207

Assuming that $360,000 was the maximum loan amount that our buyer could qualify for at 3.5% with a payment of $1617, what is the new price that our homebuyer can now afford? The new maximum loan amount based on a payment of $1617 and an interest rate of 4.5% is $319,133. With 10% down, the buyer’s maximum price is now $354,592 or $45,408 less in price.

Is it reasonable to think this will affect demand on the housing market? IT SURE IS! Our homebuyer’s purchasing power just went down by more than 11% with a 1% increase in interest rate. Whatever risk concerns have been in the past about price declines in the market, a 1% increase in rate overshadows to a great deal any decline in market price.

Will prices continue to increase at the rate we seen over the last several months. I’m seeing a change in the market now with prices leveling off through the summer. While it’s reasonable to assume we will see prices continue to rise, I don’t believe we will see the rate of appreciation continue at the fevered pace of the last year. Will interest rates be higher than 4.5% by June of 2014. Who knows? I have talked to several lenders and they are at odds with each other on this point.  Any potential buyer or seller should at least be prepared for the potential of higher rates over the next year.

If you are looking to buy a home in today’s market and have been pre-approved on a home loan through a lender, it’s a good idea to huddle back up with that lender to determine if you need to adjust your considerations on price, square footage and potential location.

If you are a homeowner thinking of placing your home on the market, it is important to understand the impact of rising interest rates, buyer’s purchasing power and negative impacts on demand.  Bottom line: Price your home appropriately and rely on the advice of a Real Estate Agent you trust who will provide you the facts about pricing and marketing your home.

Steve Quaranta
Better Homes and Gardens Real Estateimage003
Email: steveq@teamq-re.com
Phone: 916-276-7653

SACRAMENTO HOME PRICES BY ZIP CODE

 

imagesMedian home prices in the Sacramento metropolitan area continue to rise at a brisk rate; on average 20% over the last 12 months.  If you are interested in seeing what’s happening in your area, read on.

How long will prices continue to rise at this pace? Who knows?  But one thing for sure is this…. It may be a good time to buy a home, but for many it’s a difficult and arduous process.

For sellers waiting to put their home on the market to maximize profit or reduce losses after the market crash, timing the market is usually determined in hind sight.

Keep this in mind if you are thinking about putting your home on the market in the near future……

  • As interest rates rise, buyer’s purchasing power goes down.
  • As prices rise, more homes will be placed for sale on the market.  This will lead to increased inventory and will help to stabilize price and slow appreciation.  In addition, the number of homeowners who owe more than the worth of their property is decreasing, allowing them to market their homes and avoid a short sale which will further increase inventory.
  •  The typical selling season runs from February – May/June.  After June, people settle down and tend to focus on vacations and preparing their kids for school.  August tends to be one of the slowest  months of the year for home sales.

To see what’s happening with median price in your neighborhood CLICK HERE.

If you would like more specific information about home prices in your area, shoot me a quick email.

Steve Quaranta
Real Estate Professional – 20+ years in home sales
Better Homes and Gardens Real Estate
916-276-7653
SteveQ@TeamQ-RE.com

 

 

Sacramento Year Over Year Home Prices

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Most people today know that home prices are on the rise in the greater Sacramento area. Some areas like Rocklin, Roseville and Lincoln have seen median prices rise by double digits over the last year. It’s important to remember that median price can be affected, month to month, by the size and  number of homes sold.

If you would like to see year over year sales and median price changes in your zip code for December 2012 CLICK HERE!