Sacramento Real Estate - Boom or Bust?
New home builders are offering incentives to buyers this month. Six months ago there was a waiting list a mile long to get a new house.
Inventory of resale homes is growing.
There was a small increase in mortgage defaults this quarter.
The market is definitely slowing, especially at the higher end.
Some experts think the pricing boom will end, but there won't be a bust.
What do you think? Weigh in.....
Gillian Parrillo
The Sacramento Executive
Comments
Gillian,
I expect the market to slow as it generally does every decade or so. As the number of available homes on the market grows and the amount of time that a property stays on the market increases, sellers will begin to reduce their prices and this will lead to a drop in home prices over their most recent peak. How deep a dip? Who knows.
One difference this time versus previous slow downs, money is still fairly cheap. During the slow down in the early 90's the interest rate was double digits. This difference will probably translate into a lesser dip.
Posted by: Bruce Melvin | December 14, 2005 6:17 PM