Million-dollar home sales fall in Sacramento region, state

Sales of homes costing $1 million or more fell sharply across the capital region and throughout California last year as buyers remained wary, large mortgages were hard to get and more homes slipped below the benchmark value, researcher MDA Dataquick reported Thursday.

The La Jolla firm counted 291 sales of homes priced above $1 million in 2009 in Sacramento, Placer, El Dorado, Yolo and Nevada counties. A year earlier, the tally was 502 in the eight-county region. The capital region accounted for 1.6 percent of high-end sales in a state where coastal regions rule the luxury market sector.

DataQuick counted 18,621 California sales with price tags of $1 million or more. It was a fourth straight year of decline in the state after luxury sales crested at 54,773 in 2005.

Nearly 80 percent of last year’s million-dollar and higher sales in the capital area were in Placer, El Dorado and Nevada counties, according to DataQuick statistics. All are home to high-end resort markets in and near Lake Tahoe.

Sales fell from 2008 in all three counties. Lake Tahoe real estate firm Chase International reported 104 sales of lake-area homes valued at $1 million or higher in 2009. The previous year’s count was 134.

Don’t count out the wealthy, though, said the firm’s owner, Shari Chase.

“If you look at high-ticket purchases, those people are not going to be affected by any of the economic conditions. It’s about whether they want to go for their lifestyle,” she said.

DataQuick President John Walsh said traditional million-dollar markets like Hillsborough, Manhattan Beach, Newport Beach and Santa Barbara “are holding up relatively well.” Expensive newer markets that “emerged four or years ago are not,” he said.

Mike Lyon, head of Sacramento’s Lyon Real Estate, attributed part of the capital-area sales decline to significant “discounting” at the harder-to-sell high end.

DataQuick said 29 percent of California’s luxury home buyers paid cash. Lending institutions most likely to help the others were Bank of America, Wells Fargo and Union Bank, the researcher reported.

August 10, 2009
Bad June swoon for Sacramento-area homebuilders

http://www.sacbee.com/static/weblogs/real_estate/

Ouch! Homebuilders in Sacramento, El Dorado, Placer and Yolo counties reported their second worst sales month of 2009 in June, selling just 197 homes, condominiums and townhouses, the California Building Industry Association reported about an hour ago.

These things happen. But the regional sales tally was the lowest since January, when builders sold 163 homes, reported the CBIA, a trade group for state homebuilders.

It rather flies in the face of more encouraging news nationally on the new-home construction front. But sales are still very weak here as builders face significant competition from discounted bank repos. These repos still account for more than half the region’s sales.

Monthly sales totals in the four-county area by month:
Jan: 163
Feb: 201
March: 297
April: 290
May: 346
June: 197

June sales fell 43 percent from May, and were down 57 percent from June 2008, according to Costa Mesa-based Hanley Wood Market Intelligence. The firm compiles statistics for the CBIA monthly sales reports.

Statewide, builders reported 2,607 June sales. That was 13.6 percent fewer than in May and down 26 percent from the same time last year. CBIA execs called it weaker than expected and called again for the state Legislature to extend a $10,000 tax credit for buyers of new unoccupied homes in the state. The tax credit, which began in March, ran out in July due to better-than-expected demand.

Monday, the National Association of Home Builders, also called on Congress to extend the nation’s $8,000 first-time buyer tax credit for another year.

Hanley Wood research executive Jonathan Dienhart said today he expects statewide sales to match last year’s levels in coming months. But he cautioned in a statement, “It will definitely take a longer time to start mounting a significant recovery with home purchase tax credits due to expire and the broader economy continuing to struggle.”

Builders in the four-county Sacramento area plus Yuba and Sutter counties sold 1,764 homes the first half of 2009, Hanley Wood reported. That puts them on track to finish well behind last year’s 4,847 sales.

Top capital builders during the first half of 2009, according to Hanley Wood:
1) KB Home of Los Angeles, 161 sales, 9.1% market share.
2) Dallas-based Centex Homes, 143 sales, 8.1% market share.
3) Miami-based Lennar Homes, 132 sales, 7.5% market share.
4) JMC Homes of Roseville, 123 sales, 7% market share.
5) Beazer Homes, headquartered in Atlanta, 112 sales, 6.3 percent market share.

Other builders in the top 10: Arizona-based Taylor Morrison, Michigan-based Pulte Homes, New Jersey-based K. Hovnanian Homes, Michigan-based Del Webb and Texas-based D.R. Horton.

As an aside, the combined entity of Pulte, Centex and Del Webb – the result of a Centex/Pulte merger to be finalized later this year – accounted for 299 of the region’s 1,764 first-half sales, a whopping 17 percent market share.

http://www.youtube.com/watch?v=BCCg6XK3lCs

http://www.webstarmagic.com/gmac/stats_4_counties.htm

Sacramento area misses move-up homebuyers — they’re staying put

By Jim Wasserman
jwasserman@sacbee.com

http://www.sacbee.com/topstories/story/1959684.html

Almost four years into the real estate crash, a once-thriving sector of the Sacramento-area housing market – the move-up buyer – has become a virtual dead zone that must revive itself for a true recovery to take hold, analysts say.

Even as real estate rocks with enthusiastic first-time buyers and investors – accounting for up to two-thirds of area sales – one expert warns against being fooled by “the common belief that real estate is flying off the shelves.”

Momentum needed for a true recovery rests on the shoulders of those who traditionally dominate real estate markets: people who sell one house and buy another.

And they aren’t doing it.

They can’t.

“Half to two-thirds of sales in the Sacramento region have not triggered a move-up,” said Andrew LePage, an analyst for property researcher MDA DataQuick. “It was just some lender got its money back and then it ends. When that’s been two-thirds of your market for months and months, ouch.”

Until the move-up sector of the market recovers, housing can’t recover, analysts say. (Everything above $400,000 is almost at a standstill. DataQuick says sales in move-up neighborhoods such as Land Park, east Sacramento and Arden Park are half their 10-year average since early 2008.)

And until housing recovers, many believe the economy will lag, and the state with it. The downturn prolongs the pain of layoffs, fuels the plunge in property taxes and deepens the local and state budget morass.

What are the problems confronting move-up buyers? Charlene Singley, president of the Sacramento Association of Realtors, counts three strikes against them:

• “First are the vast numbers” of distress sales and bank repos, she said. “Those people aren’t moving up. They’re not even moving down. They’re just going into rentals.”

The National Association of Realtors says two-thirds of sales in California this year have been distress sales that don’t trigger a move-up.

• “Equally big are homeowners out there who aren’t in a foreclosure, not in a short sale,” said Singley. “They don’t have the equity to pull out to put down on another house. They used to pull it out, move up, make money, do it again. You’d see it three or four times.”

Many consider that real estate stairway the promise of California. The theory is you have to “get in” the market and then ride it up. But now about one-third of borrowers in El Dorado, Placer, Sacramento and Yolo counties are trapped where they are – perhaps for years – owing more than their homes are worth.

• “Finally, if they’re lucky enough to have equity, maybe their income is decreased or they’re worried about their job security,” Singley said. “They could move, but they don’t have to. Why would they put their homes on the market? Not when they could wait a few years.”

This large collective impact of distress sales, negative equity and job fears translates into “an outright collapse in organic sales that measure the true health of the housing market,” according to Mark Hanson, managing director of Field Check Group, a Bay Area financial industry consultant. Hanson said California resales that trigger a second move – whether up, down or across – were down 60 percent in April from three years earlier.

That explains why Cynthia Hearden’s $459,000 house in Sacramento’s Land Park neighborhood has been slow to sell since its March listing. It tells why Kathy McKnight in the city’s Pocket neighborhood decided not to offer her house for sale after an agent suggested an asking price of $525,000, less than she had hoped.

Hearden, nearing retirement and aiming to downsize, showed one of the more creative responses to lack of move-ups. When she got an offer based on the potential buyer first selling her own house, Hearden waited as neither house moved. Then she looked at her potential buyer’s $289,000 house in South Land Park, and proposed a trade accounting for price differences.

The other homeowner was interested, but even that deal fell through last week.

Home Front: Lenders’ phones silent as rates rise

By Jim Wasserman
jwasserman@sacbee.com

http://www.sacbee.com/business/story/1940229.html

Mortgage rates, rising quickly from near-historic lows earlier this year, are already having negative consequences in the capital region.

“All of a sudden the phones just stopped ringing,” said Michael McGee, president of Rancho Cordova’s Winchester McGee Real Estate & Loans.

“At least right now, the refinance window has somewhat shut,” added Brent Wilson, senior loan consultant at Sacramento’s Comstock Mortgage.

It’s also spooking buyers who haven’t locked in a rate.

“I called my agent and said, ‘We have to cancel,’ ” said Toby McBride of Citrus Heights on Thursday. He and his wife put in an offer on a house June 1 when rates were 5.12 percent. When the deal wasn’t agreed to by Tuesday, with rates at 5.87 percent, they pulled the plug. (The new rate would add $175 a month to payments, said McBride, a federal worker).

“Definitely, the sudden change in interest rates has caused us to rethink our condition and lower our search price,” he said.

As investors stew about inflation in the long run, rates are pushing back toward 6 percent and have reached a seven-month high, according to mortgage giant Freddie Mac.

The firm’s Thursday survey revealed a national average of 5.59 percent (plus points) earlier this week for a 30-year fixed-rate loan. That’s up from 5.29 percent last week.

Thursday, financial Web site Bankrate.com showed an overnight average of 5.74 percent.

“It just pretty much happened so quickly,” said Charlene Singley, an agent with Lyon Real Estate and president of the Sacramento Association of Realtors. “I think it will take a while for people to realize that this is where the rates are now.”

“I think we’ll get some improvement from where we are today,” said McGee. “But back to the high fours? It’s possible, yes. Likely? I question that.”

New home sales suffer

Thousands of distressed existing homes are making life harder and harder for Sacramento-area home builders. Their April sales numbers revealed the capital-area market as one of the state’s weakest, according to the California Building Industry Association.

Builders in El Dorado, Placer, Sacramento and Yolo counties sold 290 houses in April. That was seven fewer than in March, and 48 percent below the same month last year, CBIA said this week. Builders in Yuba and Sutter counties sold 33 – better than March – but down 25 percent from the same time last year.

The numbers put area builders on track for a worse year than 2008, when they sold just 4,847 homes, according to Hanley Wood Market Intelligence.

In 2004 they sold 17,491.

The declines come amid fierce competition with discounted bank repos and short sales. In April, builders closed just 9.6 percent of the escrows in the capital area, compared with 24.5 percent in April 2005.

Statewide trends were a little better. Builders said sales were almost 7 percent better in April than March. But they were still down 31 percent from April 2008.

The CBIA said the median April sales price for a new house in El Dorado, Placer, Sacramento and Yolo counties was $292,900. It was $237,000 in Yuba and Sutter counties.

More time for renters

Oh, no. Home Front muffed a figure last week in an item about the Obama administration adding new protections for renters. In mistakenly noting that California renters get 30 days’ notice to move after banks repossess houses, we overlooked last year’s state Senate Bill 1137.

The bill gave tenants affected by foreclosure an extra 30 days’ notice – to 60 days – through Jan. 1, 2013.

President Barack Obama, however, just signed a bill that gives renters with month-to-month arrangements 90 days’ notice in foreclosure situations. Renters with leases in foreclosed homes stay until leases expire.

Profiting from feng shui

These days everyone is worried about money. But how do you get more? Here are a few feng shui ideas to increase your flow of wealth at home. For these, thank New York real estate broker Debra Duneier:

• The burners on your stove represent wealth. Keep them clean and alternate your use of the burners when cooking … The refrigerator should be filled with healthy food. A full refrigerator brings in abundance.

• The indoor plants that are wealth enhancers are bamboo and jade plants.

• Take three lucky Chinese coins and tape them to the back of a rug. Every time someone walks in (your home’s entry point) they symbolically are bringing money into your property and into your life.

• Keep toilet seats down when not in use. Keep them up and money will disappear.

More tax credits sought

Finally, an update on tax credits: The California Franchise Tax Board reports that buyers of new, unoccupied homes have requested $82.5 million of the $100 million allocated for $10,000 tax credits.

The building industry is working the state Legislature to add more millions. In Washington, D.C., real estate and business executives are lobbying Congress for a new $15,000 tax credit for all buyers. A current $8,000 tax credit is just for first-time buyers.

Home Front: European media want close-ups of capital-area housing crash

By Jim Wasserman
jwasserman@sacbee.com

http://www.sacbee.com/736/story/1883525.html

Europeans are making Sacramento a regular stop on media expeditions to the housing crisis that has been pounding their banks.

This year, Home Front has received inquiries from a Swiss newspaper, a German magazine, a Dutch television show and most recently a German public TV program about finding places that reveal California’s housing crash and the people who have endured it.

Know this: The big real estate meltdown that defines the Central Valley and the outer Bay Area suburbs is interesting to people who live nine and 10 time zones east of here. It’s more than curiosity. Big European banks are taking hits after investing in the risky mortgage-backed securities tied to California real estate.

Public broadcaster ZDF Television of Mainz, Germany, said it plans to show up this Memorial Day weekend in the capital region as part of a Northern California tour. Producers called last week from Washington, D.C., scouting for newer struggling neighborhoods marked by foreclosures and for-sale signs. The aim is to show the audience back home the thousands of homes financed with subprime and adjustable-rate loans sold by Wall Street to German financial institutions.

The Dutch public television current affairs program NOVA also initially planned to have a crew in California this week, but didn’t make it. It was looking for partially inhabited and bankrupt apartment buildings, and was scouting Sacramento for possibilities.

“We didn’t actually make it to California (yet),” said Lynn Berger, a journalist with the Hilversum-based current affairs show. “But although we didn’t make this specific report, we have reported about the California real estate situation in the past (about foreclosures, mostly). It is definitely a topic that has been, and will be, covered widely on Dutch TV and in the newspapers,” he said in an e-mail this week.

Several weeks ago, Munich-based Focus Magazine sent reporter Stefan Wagner to Northern California for a magazine story on “effects of the financial crisis on Californians.” Wagner planned a trip to Sacramento and the Central Valley’s foreclosure belt (Merced especially) to talk with people losing their homes.

A Google search hasn’t yet turned up his report yet. But if you see Germans with video cameras this weekend be friendly; wave your adjustable-rate mortgage for the viewers back home.

Expanding affordability

There’s more good news on the affordability front. On the heels of last week’s California Association of Realtors report that 80 percent of first-time buyers can afford the median-price starter home in Sacramento, a prominent national housing index says three-fourths of homes sold in the capital area are “affordable.”

The National Association of Home Builders/Wells Fargo Housing Opportunity Index reported this week that 76 percent of homes sold in the first quarter of 2009 in El Dorado, Placer, Sacramento and Yolo counties were affordable to households earning the region’s median income of $72,800.

What’s most astonishing is how fast that ratio has changed. Just two years ago in the first quarter of 2007, only 13.4 percent of homes in the four-county region were affordable to households with a median income of $67,200.

Don’t miss credit deadline

There is one new thing Home Front should say about the state’s $10,000 homebuyer tax credit after a phone call from a buyer who missed the boat: Be sure to hound everyone involved in your sale to fax the application to the state Franchise Tax Board within seven days of closing escrow.

This caller said many real estate and escrow agents aren’t up to speed on the tax credit for buyers of new unoccupied homes. And he missed the deadline to apply, being busy with moving and paperwork. Goodbye $10,000 tax break.

The Franchise Tax Board says the builder’s people must complete a state form and give a copy to the buyer or escrow rep. The buyer fills out more details and then the escrow agent faxes it to the FTB. Advice from one who learned the hard way: Keep an eye on them.

Incidentally, a bill, AB 765, that would add $200 million to the tax credit allocation easily passed its first committee test – winning a 9-0 vote Tuesday in the Assembly Revenue and Taxation Committee. It goes now to the Assembly Appropriations Committee for similar consideration.

Pulte dominates region

The giants are getting bigger and more powerful. If 2009 continues the trends of its first quarter, Pulte Homes will sell one in five new houses this year in the capital region.

Pulte, with its Del Webb subsidiary and pending merger with Centex Homes, had a 20.4 percent market share in El Dorado, Placer, Sacramento, Yolo and Yuba counties, reports market tracker Hanley Wood Market Intelligence.

The firm counted 148 sales by Michigan-based Pulte and its two affiliates among 725 January, February and March sales in the six-county region.

That level of market share is unprecedented in the region in the last 20 to 30 years, said Hanley Wood’s Sacramento analyst Kathryn Boyce.

http://www.webstarmagic.com/gmac/stats_4_counties.htm

Zillow: Many in area owe more than home is worth

http://www.sacbee.com/business/story/1837044.html

ShareThisPublished: Wednesday, May. 6, 2009 – 12:00 am | Page 8B
Home values in El Dorado, Placer, Sacramento and Yolo counties dropped by $7.3 billion in the first three months of 2009 and have lost $40 billion in the past year, according to online real estate evaluator Zillow.com.

The Seattle firm estimates that 35.4 percent of homeowners in the four-county area now owe more on their mortgages than their homes are worth.

That’s up from 33.9 percent in the fourth quarter of 2008, according to Zillow.

It’s worst for those who bought in the past five years. Zillow said 68 percent of those Sacramento-area homeowners have negative equity.

In Yuba and Sutter counties, 78 percent of those who bought in the past five years owe more than their homes are worth, Zillow reported.

– Jim Wasserman

Latest Statistics For 4 Counties

http://www.greatwestgmac.com/real-estate-blog-article-Latest-Statistics-For-4-Counties-Monday-27-April-2009_320.html

The charts linked below provide sales statistics for the counties of Sacramento. and the surrounding counties of: El Dorado, Placer and Yuba. They compare March 2009 to the year prior (March 2008), as well as data for February 2009 vs. February 2008. In most areas the number of sales posted was significantly greater to the previous year. However, prices have declined for the same time period.

The Sacramento MLS 24 Hour Watch has demonstrated a significant number of days reporting more homes transitioning to “Pending Sale” compared to the number of “New Listings” entering the market.

Many bank owned properties are receiving multiple offers from Buyers, as prospective homeowners, see opportunity in the marketplace.

Related Links: www.webstarmagic.com/gmac/stats_4_counties.htm