Real Estate Update, Fall 2022

You’ve probably heard the hype and seen the headlines – they paint a picture of a
real estate market in crisis. While it’s true that we’re in a very different market
than just 6 months ago, it’s really not a crisis. Sacramento has a sturdy
employment base, offers a very desirable lifestyle, and most folks have enough
equity in their homes to encourage weathering these days when inflation is causing
pain in many households.

The August jobs reports states there are 315,000 net new jobs nationally, and
employment is now slightly above its pre-Covid level. The unemployment rate is now
about 3.7%, close to a 52-year low; the labor force has shrunk, and wage growth is
accelerating. These numbers are encouraging on one level, but long story short,
they will not encourage the Fed to cut interest rates any time soon. In fact, word
is that short-term interest rates will increase again this month. Historically
speaking though, rates really aren’t that high.

What does this mean for Sacramento home buyers and sellers? It depends… If you
need to sell due to a job change or other life event, it’s best to price very carefully
– not just based on what your neighbors’ homes have recently sold for, but what is
happening in the area right now. Also, first expressions are really important –
professional photography is a must, as is a marketing plan that reaches far and
wide. There are still plenty of buyers out there, they’re just feeling a little beaten
up by the crazy market we’ve been through recently, and they’re looking for deals
now.

Buyers, as I just mentioned, are looking for deals! Although many are “hovering”,
watching for listings that sit for a while in hope of price reductions. While not a
bad strategy, over time home values in Sacramento do rise – so buying with the
expectation of moving in a year or two may not be a great idea, but for the long
term it still makes sense. After all, we all have to live somewhere, and deals can be
found! If you have any questions about this market, or real estate in general, I’m
always happy to help.