Are Home Prices Really Double in Sacramento?

By
Real Estate Agent with RE/MAX Gold DRE #00697006

sacramento home pricesA seller in Granite Bay expressed interest yesterday in possibly selling her spacious two-story home near Douglas Ranch. The problem is she wants a home in the seven-hundred range to be worth at least $900,000 to maybe a million. And why not? Everybody wants to make a profit from an investment, even if it's a home that they are moving out of and away from to another city. Because they always have the option of renting their home and paying negative cash flow. Negative cash that might not make up for little appreciation, but not my call; not my home.

She agreed with my assessment of her market value and said it was not enough. The thing is in this market it's hard to say whether a home will sell at the price it appraises. Because those can be two very different things. There is the acceptable sales price that a buyer is willing to pay and a seller is willing to sell at (called market value), and then there is the appraisal, based on comparable sales. Today, those two values can be very far apart. And I suspect that's what makes sellers hope that home prices are about to double in Sacramento.

Read more in my personal blog today about Game of Thrones, House of Cards, and I also talk about When Will Home Prices Double in Sacramento?

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Elizabeth Weintraub is co-partner of Weintraub & Wallace Team of Top Producing Realtors, an author, home buying expert at The Balance, a Land Park resident, and a veteran real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown, Carmichael and East Sacramento, as well as tract homes in Elk Grove, Natomas, Roseville and Lincoln. Call Elizabeth Weintraub at 916.233.6759. Put our combined 80 years of real estate experience to work for you. Broker-Associate at RE/MAX Gold. DRE License # 00697006.

Photo: Unless otherwise noted in this blog, the photo is copyrighted by Big Stock Photo and used with permission.The views expressed herein are Weintraub's personal views and do not reflect the views of RE/MAX Gold. Disclaimer: If this post contains a listing, information is deemed reliable as of the date it was written. After that date, the listing may be sold, listed by another brokerage, canceled, pending or taken temporarily off the market, and the price could change without notice; it could blow up, explode or vanish. To find out the present status of any listing, please go to elizabethweintraub.com.

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Rainer
403,840
Dan Hopper
Keller Williams Realty Downtown LLC - Denver, CO
Denver Realtor / Author / Advocate/Short Sale

Elizabeth, we have seen increases in some areas that is kind of surprising in the Denver Metro area.  But then again, our home inventory is around 6,700 which is about the lowest it has been in 25 years.

Mar 28, 2013 02:09 AM #1
Ambassador
1,878,528
Gary Woltal
Keller Williams Realty - Flower Mound, TX
Assoc. Broker Realtor SFR Dallas Ft. Worth

Excellent point Elizabeth that market and appraisal pricing are often NOT the same. You never REALLY know till it goes on the market what will happen.

Mar 28, 2013 06:53 AM #2
Ambassador
1,229,631
Melissa Zavala
Broadpoint Properties - Escondido, CA
Broker, Escondido Real Estate, San Diego County

With pie in the sky dreams like that I always think of the Emily Dickinson poem, "Hope is a thing with feathers". That seller's dreams of a home sale have flown out the window.

Mar 28, 2013 10:01 AM #3
Ambassador
3,084,500
Chris Ann Cleland
Long and Foster REALTORS®, Gainesville, VA - Bristow, VA
Associate Broker, Bristow, VA

I suspect we're going to start seeing appraised values coming in lower than the contracted sales price soon.  Demand is very high, supply very low.  That person is expecting their home to double in value should start buying lottery tickets.  Might get better results, and that's not saying much.

Mar 28, 2013 01:34 PM #4
Rainmaker
2,884,267
James Dray
Fathom Realty - Rogers, AR
Exceptional Agents, Outstanding Results

As the prices rise so will the appraisals the problem is the appraisals will be behind until the market stabilizes. 

Mar 28, 2013 08:28 PM #5
Rainer
218,050
Kimberley Kelly, SFR, HAFA, GREEN
HK Lane, Christie's International Affiliate, 760-285-3578 - La Quinta, CA
I do Real Estate like I played polo-to WIN!

Doubling?  Reminds me of 2005 again...of course the bottom was much lower.  We shall see, right??

Mar 28, 2013 09:57 PM #6
Rainmaker
2,516,425
Myrl Jeffcoat
GreatWest Realty - Sacramento, CA
Greater Sacramento Real Estate Agent

Appraisers don't always look at home values with the same inflated exhuberance that some buyers and sellers have.  A market with scarce inventory, like we are currently experiencing, is ripe for a lot of disappointment when those appraisals come in.  When I was out and about yesterday, I noticed an over abundance of lawn signs.  No, they weren't For Sale signs, they were For Rent signs.  Very interesting times!

Mar 30, 2013 09:57 PM #7
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