bacbinh,  in Albuquerque, NM

As of today Nov 13, housing market in Elk Grove & surrounding areas are slowing down. Should I wait until next year to buy a house? Any suggestion?

Asked by bacbinh, Albuquerque, NM Sun Nov 10, 2013

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Did it slow down? Bacbinh prediction was correct for # of closed sales that month. Only 144 in Elk Grove that month of November 2013. Those numbers stayed low through the winter. But, just as so many agents predicted, it picked up in the spring. The important numbers for Binh, as a buyer, was not closed or pending sales, but inventory, average price, and average price per square foot.

The inventory climbed steadily to the end of this summer from 279 listed in December 2013 to 425 listed in August.

Average price steadied at $317,000 until April 2014 then it climbed to $331,000 that month to $347,000 at the end of August. A $30,000 increase in the average. Price per square foot ticked up from $149 in December 2013 to $164 per square foot in August. So if Binh waited until early in 2014 he suffered no harm, but if he waited past the end of winter, he shot himself in the foot. (The square foot)
0 votes Thank Flag Link Thu Sep 18, 2014
Jim Walker, Real Estate Pro in Carmichael, CA
MVP'08
Contact
Great question, house prices are leveling out a bit, but are still predicted to go up along with rates (moderately). I would advise to buy ASAP because your going to get the best deal right now. The reason for this is the FED's are artificially keeping rates low, and trying to control the growth of pricing by stricter guidelines to lenders for investment properties.
0 votes Thank Flag Link Wed Jan 22, 2014
I would advise you to buy now before prices go up this Spring . Interest rates will most likely creep up throughout the year and result in less house for you .
0 votes Thank Flag Link Tue Jan 21, 2014
Awe, come on Bruce. It's just a little tongue and cheek. Don't take it so sensitively.
0 votes Thank Flag Link Mon Nov 11, 2013
Honestly guys, we can show more professionalism with the community by not focusing on an obvious date conflict and focus on their actual request, let's work on raising the bar a bit or don't bother responding to these posts if you can't help yourself, that's just my opinion.
0 votes Thank Flag Link Mon Nov 11, 2013
Did you want to repost this question on Wednesday, November 13, 2013?
0 votes Thank Flag Link Mon Nov 11, 2013
Right now interest rates are great and if you are buying an investment you would definitely want the best interest rate you can get. Slowly but surely it's not making much sense for investors as far as your rate of your return. A lot does depend on the price range.

As far as slowing down...I'd say it's not like it was at the end of last year and the beginning of this year. Homes were selling within days in the $300,000 and under price range. Now it's taking some of them a little bit longer. Inventory has rose in the past eight months which has had an impact on sales and price. Interest rates rose and dropped again recently.

The market has fairly slowed down compared to what it was, but sales are still fairly steady. I'd say this is a great time to buy. Interest rates are relatively low, inventory is a little higher and home values are still slightly rising.

Start shopping.

Sincerely,

Jaime Becker
Lyon Real Estate
jbecker@golyon.com
http://www.SacramentoHomesByJaime.com
Off: 916-484-3610
Cell: 916-715-7454
BRE# 01737783
0 votes Thank Flag Link Mon Nov 11, 2013
If you are looking at buying a home to live in, rather than for investing, it's clearer to make that determination. Buying a home to live in, is more than a 'good buy' it's a necessity. You have to have somewhere to live...

You should consider that your housing cost should be about 1/3 of your income at most. So you can choose to buy now- at the lowest interest rate and possibly a little higher price, or you can buy later at a higher interest rate and possibly lower housing price. Essentially your monthly cost will be the same. But if you looked at the cost of the fully amortized loan, waiting - and paying a higher interest rate- will actually cost you more over the cost of the loan.

Buy during the holiday season, or at least during the winter season in the Sacramento area, will give you the lowest seasonal rates. Buy now, because I know interest rates will go up more likely than go down.
0 votes Thank Flag Link Mon Nov 11, 2013
I agree with almost everything...experienced agents and articles/reports to back up the data. Not even a crystal ball could make it any clearer to buy now. Haven't heard anyone in the biz say they think prices will drop over the next few years.

Just one point to clear up...sellers determine pricing with advice from listing agents. Some don't use that advise. I just had a listing which finally went pending after almost 4 months. The price was too high (I warned them!), but they finally dropped it to market value recently.

Elk Grove is looking pretty good right now. I closed a short sale with a buyer there and by the time the bank approved it, the value had gone up $25K. Nice deal!
0 votes Thank Flag Link Sun Nov 10, 2013
I disagree with the writer's statement that EG is slowing down. Perhaps some areas of Sac have slowed, end of year slowing is normal. I find EG still to be busy, active and many properties with multiple offers.

Why wait? Find the type of home or investment you want and go buy it. If you wait, you could face more competition from other buyers, or increased values/prices next year. I don't think we are about to see any huge value drops, so if you are gambling on price and waiting to buy, I think that's a losing gamble.

And, check with your tax advisor--I believe some of your costs of purchase are a tax write off, so if you can close this year, you'd start reaping the tax advantage immediately.
Web Reference: http://www.kyleeroe.com
0 votes Thank Flag Link Sun Nov 10, 2013
It's normal for the market to slow in the fall/winter. With less competition and serious sellers, you may end up paying less than you would in a hotter market. With looming lending changes coming up in January, if you find the right house, buy it! I wouldn't recommend waiting, unless of course you are paying cash. See article:

http://www.marketwatch.com/story/its-about-to-get-harder-to-…
0 votes Thank Flag Link Sun Nov 10, 2013
It's hard to say what the future brings. Interest rates are still low today, so buying now could be a good thing.

On the other side of things, during the spring there are usually more homes to choose from. I guess it's just up to you! Either way, good luck!
0 votes Thank Flag Link Sun Nov 10, 2013
Hi bacbinh,

I would move forward with buying now; here's why:

"The Top 4 Challenges Buyers & Sellers will face in 2014! "
http://tinyurl.com/lg2n2v5

-Steve
0 votes Thank Flag Link Sun Nov 10, 2013
Alot depends on whether your paying cash or obtaining financing....

The Elk Grove market is indeed seeing increases of inventory on a monthly basis due to the interest rate rise around July of this year and the Hedge Fund investors pulling back their purchasing activity in the marketplace. Many of the price reductions you see right now are not "value" decreases they are typically Listing Agents correcting their value miscalculations when they listed the homes above the comparable property sales data.

If you are paying cash, I would say be conservative in the market and take the time to find the perfect property for you, however if you are obtaining financing, I would say any price decreases next year you feel may happen would be over shadowed by an increase in financing costs. Data coming from many organizations seem to be averaging that the thought is we will be 1- 1.5% higher in interest rates this time next year.

Also QE is on the chopping block which is what has been keeping interest rates down and with each new jobs report it puts more pressure on the mortgage industry because investors are driving up expected rate costs going into the new year. Once QE is no longer a stimulus with the Treasury and they expect the secondary market to come in and fill the space, interest rates will go up to the real risk factor not the stimulus we are in now. (If you don't know what QE is I will make it simple: The Fed is purchasing approx 80B a month in mortage backed securities and that is what is keeping the interest rates below the cost of risk, once it is removed, rates will not be as low as they are today)

NOW, if you are buying as an investment property, keep in mind you are depreciating the purchase cost over a set amount of time (check with your CPA for more details) so any decrease in home pricing may not have a huge impact if you are negating that with tax benefits. The interest rate again would factor into that equation.

If you have any questions or would like updates on inventory levels in the surrounding areas, we review that activity quite often for our clients and would be happy to share.

Bruce Slaton Broker
Realty World eCurb REALTORS
http://www.ElkGroveHomeSource.com
CalBRE#01305148
0 votes Thank Flag Link Sun Nov 10, 2013
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