Blog

Posts Tagged ‘Roseville’

Home sales gravity: Higher-end prices in capital area can drop farther

Friday, October 23rd, 2009

After years of falling values and a massive sell-off of foreclosed homes in the Sacramento region, it’s easier now to believe real estate agents when they say the market has bottomed out.

But wait. That’s the lower end, houses priced at roughly $300,000 and under, the zone of repos and bidding wars between investors and first-time buyers.

The higher end of the Sacramento-area market – say anywhere from $500,000 to $1 million or more – still has ample room to fall unless this economy surprisingly rebounds. So owners are whacking harder now on initial asking prices.

You can see that in new statistics from home search firm Trulia.com. The company says homeowners with listings in El Dorado, Placer, Sacramento and Yolo County have collectively reduced asking prices by $156 million since putting out for-sale signs.

About 40 percent of that markdown is from homes priced at $1 million or more. On average, these richest owners have cut their prices by $271,000 in El Dorado County, and $334,000 in Placer County.

Up in the real estate heights, it remains more expensive for buyers to get financing. The move-up buyer pool is smaller than ever as thousands at the lower- and mid-market have seen their equity shredded.

Those who can buy at higher prices are savvy and watching for capitulation, meaning “price reductions and opportunity,” said Bob Bronswick, head of Coldwell Banker’s residential brokerage for the Sacramento and Lake Tahoe region. For owners, it’s all about what Bronswick and others in the trade call “getting a little more realistic.”

Bronswick said the higher end is a little stronger than a year ago. Yet numbers from the Sacramento Association of Realtors show just 2.9 percent of October’s buyers paid $500,000 or more in Sacramento County and West Sacramento. At today’s pace, it would take two years to sell the houses in SAR’s territory priced at $650,000 or more, said association President Charlene Singley. The market as a whole has a much smaller inventory of unsold homes – just 3.2 months worth.

This story is repeated all over California. There’s a market for it still,” Bronswick said of higher-end homes. “But it’s a little bit softer.” In a business where no one likes to be negative, and inside an economy that hasn’t got its act together yet, that’s probably putting it – well, softly.

 

Rents headed down again

 

While we’re speaking of deflationary real estate, area apartment rents have returned to late 2006 levels. That’s after a yearlong slide that continued in July, August and September, Novato-based industry tracker RealFacts reported this week.

No wonder capital apartment complexes are offering “two-bedroom blowouts” or a four-bedroom lease for the price of two bedrooms.

RealFacts pegged average third-quarter rent at $946 for 76,000 apartment units in El Dorado, Placer, Sacramento and Yolo counties. That’s down from $974 a year ago. The average two-bedroom, two-bath unit goes for $1,062, said the firm.

Rents at large apartment communities are falling in tandem with higher vacancies as more people who have lost their jobs double up, live at home or rent houses from people unable to sell them.

Average monthly apartment rents and occupancy rates in capital-area cities:

• Davis: $1,354; 96.4 percent.

• Elk Grove: $1,098; 88.9 percent.

• Folsom: $1,138; 90.4 percent.

• Rancho Cordova: $814; 93.5 percent.

• Rocklin: $1,047; 93 percent.

• Roseville: $1,066; 92.9 percent.

• Sacramento: $929; 92.4 percent.

Tags: , , , , , , , , , , , , , , , , , ,
Posted in Real Estate, Real Estate News | No Comments »

Layoffs, buyouts spur many to rethink and retrain

Monday, October 5th, 2009

7B4HARNUMBIZ

Jason Harnum of Roseville, shown above with his cat Charley, started a pet ID business after he lost his job as a mortgage broker. His company, Pet ID for Me, lets pet owners create ID tags online. The tags look like driver’s licenses, top, and owners can add their pet’s name, breed, color, contact information and photo.

Editor’s note: This one in an occasional series of stories about how Sacramento area workers are reinventing their careers during a period of high unemployment.

Maybe you’ve been laid off, accepted a buyout or taken early retirement and now are thinking about your next step.

Whether it’s a job-training program, a return to college or a venture into a small business or franchise, today’s rugged economy has led many to reconsider their career path.

At the Sacramento Employment and Training Agency, more than 50,000 people visit its 12 Sacramento Works career centers each year seeking résumé assistance and career counseling, said Robin Purdy, SETA’s deputy director of work force development.

Nearly 15,000 job seekers sought the centers’ help in the past three months alone – a 9 percent increase from the same three-month period last year, Purdy said. Many are looking for ways to retrain.

“We are seeing more and more people interested in improving their skills and looking for occupational skills training” in burgeoning fields such as health care and careers tied to green technologies, Purdy said.

Experienced workers are also retooling, re-entering the campus and the workplace. The numbers of students 59 and older enrolled at California State University has steadily grown over the past five years.

In fall 2004 semester, 1,677 students 59 and older were enrolled at CSU campuses. By fall 2008, the number had climbed to 2,117 – 182 of those at Sacramento State – with the majority in graduate studies.

For some seniors, the situation is more dire. They’ve absorbed a late-career layoff or buyout or have watched their 401(k) retirement funds disappear. They’ve forestalled retirement or have been forced to return to the job market.

“We’re seeing a lot of skilled people coming back to the work force,” said Bob Rice, a project director for AARP Foundation’s WorkSearch program in Sacramento, which helps mature workers re-enter the workplace. Officials estimate registration in the program is up 40 percent from the same time last year.

“Frustration is showing up with a lot of the people we work with,” Rice said. “They’re running out of money, they’re losing their house. There’s a lot of desperate people out there.”

At Los Rios Community College District, enrollment this fall at the four-campus district has swelled by 5,000 students from fall 2008, and classrooms are stretched to the limit.

Though officials say the reasons for the spike vary widely, among the incoming students are job seekers and employees squeezing into classes to boost their skills or jump-start their chances on the open market.

“We do have job seekers returning to our colleges. They’re coming to us because their out of work or they’re afraid of losing their jobs,” said Susie Williams, a district associate vice chancellor.

Some 70 El Dorado County residents signed on in June to a program for job seekers organized by Green Valley Community Church in Placerville. After the eight-week program ended recently, five came out of the program with jobs, said volunteer instructor Michael Dugan.

“We wish the numbers were higher,” he said, but in today’s economy, “we’re delighted that anyone’s getting jobs.”

Another 100 job seekers are signed up for the current eight-week module.

In a Sacramento-area market where the jobless rate sits at 12 percent, more people are looking for ways to stay afloat or chart their own destiny.

Now is the time, AARP’s Rice said.

“When you’re laid off and that is a gap in your work life, it gives you a chance to figure out what you want to do.”

Tags: , , , , , , , , , , , , , , , ,
Posted in Motivation, Real Estate, Real Estate News, Uncategorized | No Comments »

Suburban Sacramento land rush? Big homebuilders buy up ‘finished’ lots

Friday, August 14th, 2009

Sacramento’s new-home sales are still down and out, but some capital-area builders are betting money that the region’s suburbs will soon resume their growth boom.

They’ve begun snapping up ready-to-build home lots at prices ranging from $25,000 to $67,000, setting the stage for a new suburban land rush.

The phenomenon suggests that a real estate market in decline for four years may be resetting for a new business cycle, some say.

Builders looking for land are focusing on “finished” lots, which already have government approvals, streets and utilities.

“They just have to pour a slab and start building,” said Kathryn Boyce, Sacramento analyst for Costa Mesa consultant Hanley Wood Market Intelligence.

Capital-area builders say prices for finished lots have risen 20 percent since April as giant public builders muscle back into the region’s land game for the first time since 2005.

Boyce said the land rush is greatest in Placer County, followed by Folsom and Elk Grove.

Hanley Wood counts 17,251 finished lots in El Dorado, Placer, Sacramento, Sutter, Yolo and Yuba counties. Many are owned by lenders that repossessed them. Others are owned by development firms that need to raise cash. Investors own still more.

The recent escalation in land prices has led some in the industry to question whether they can make money when so many homes are priced at $250,000 or less.

“Prices might be going up too fast,” said Tim Lewis, owner of Roseville-based Tim Lewis Communities.

Lewis recently bought lots at two projects in the capital region and one in Reno – his first in that city. “I’m cautiously looking at projects, but I’m certainly not on a buying frenzy like some of these publics (publicly traded builders) might be,” he said.

Even with the recent rise, land prices in the Sacramento region are nowhere near the dizzying levels of five years ago. At the height of the real estate boom in 2004, builders paid up to $150,000 for finished lots in Roseville, and up to $120,000 in Natomas and Elk Grove.

Still, the renewed scouting and buying by building giants has sent a buzz through an industry that has endured prolonged downsizing and financial trauma.

“There is a consensus out there that we are at the bottom or pretty darn close,” said James Radler, a Roseville-based land broker with Park Place Land Advisors of Irvine.

Radler and others say publicly traded home builders such as Los Angeles-based KB Home, Texas-based D.R. Horton, New Jersey’s K. Hovnanian Homes and Meritage Homes, headquartered in Arizona, are among those looking at lots and buying. Others in the game include private Arizona-based building giant Taylor Morrison. All are among the capital region’s top builders.

“These guys need lots,” Rad- ler said. “If they don’t do deals, they don’t build homes, and if they don’t build homes they aren’t in business.”

Most of the builders didn’t respond to Bee inquiries, which is not surprising, say those who watch the industry. Said Boyce, “They’re trying to position themselves without anybody knowing.”

“They all want to be under the radar as much as they can,” added Dean Wehrli, vice president and Sacramento analyst for Sullivan Group Real Estate Advisors of San Diego.

During the housing downturn that began after area home prices peaked four years ago this month, many large builders sold off home lots to maintain balance sheets. A few closed down divisions and left the area. Now, though capital-area home building remains sluggish – just 1,764 sales the first half of 2009 – firms are competing again for lots in a market they expect to begin rising as early as 2010.

Industry analysts say big Wall Street home builders, especially, need more lots to keep operations going while waiting for a new cycle.

“They essentially haven’t done any buying for four years,” said Radler.

The supply of lots is also constrained by the closing of Natomas to new building permits through 2011. That region, popular with buyers and builders for much of this decade, is under a building-permit moratorium until levee fixes bring 100-year flood protection.

Tags: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,
Posted in Real Estate News | 5 Comments »