Sonora, CA – Tuolumne realtors report home sales are up a surprisingly robust five percent over this first quarter, compared to the same time last year.
The first quarter of 2016’s median sales price came in at $230,000, which is also a two percent improvement on the 2015 year-end median sales price. Tuolumne County Association of Realtors (TCAR) spokesperson Karen Burkhardt remarks, “I think that is very hopeful for people who are invested in a home – it shows that the investment is well-placed. We haven’t seen a five percent boost…that is pretty healthy, and I think it means that we are on the road to healing after the housing crisis.”
On the plus side, Burkhardt says, short sales have all but disappeared. Only one short sale was reported in the first quarter of this year; last year at this time, there were eight. For all of 2015, TCAR counted 17; in 2014, there were 48.
Sellers: Some Basis For Greater Expectations
While the average of 62 days on the market has gone up by five days over the same period last year, Burkhardt attributes it more to a healthier market, as opposed to sellers’ radically overpricing their properties. “People have higher expectations for return on their investment…we have left that bad housing market behind. So, I think there is…lengthening [of market time] a little bit, based on the pricing that people want for their homes – and when they see the market recovering they have some basis.”
A market snapshot taken earlier this month (April 6) showed 353 active listings and a current median listing price at $289,900. The listing price reflects a two percent improvement from the snapshot taken January 7, which showed 341 listings.
Regarding statewide housing prices, the California Association of Realtors (CAR) reported that, at the end of February, the California median home price was $446,460. The highest, reported in San Francisco County, came in at $1,437,500; Siskiyou and Tehama counties reported the lowest median home price at $175,000.
Who’s Buying, Who’s Trying
Currently, Burkhardt says that local realtors are seeing that the bulk of the buyers remain families, looking to buy up — or older people, looking to downsize. “What we really want to provide in any healthy housing market is that housing ladder,” she explains. She ruminates that Tuolumne County is still missing those options.
“Realtors are interested in good rental housing because it helps move people through [a ladder of price points] and gives them options — otherwise you look at leaving the county or compromising,” Burkhardt states. In the wake of the Butte Fire, she adds that TCAR realtors are now seeing a bit of a bump up in demand for housing and land. She attributes some of it to buyers possibly frustrated with rebuilding in Calaveras but still wanting to stay in the region.
For sellers, spring time is always a good time to list properties, and this year is no exception, says Burkhardt, especially in light of the improving market. Presently, with the inventory of housing listings at just under six months, the sales are moving at an average pace, she points out. Looking at the options at $200,000 and below, she warns that it is challenging to find a good enough option that will qualify for a loan but cash buyers looking for a fixer-upper may still find a deal.
Lower End Price Points Disappearing
In the first quarter of this year there were 45 sales at $175,000 and below, down nearly a quarter from the same time last year. Sales at $200,000 and below made up just over a third of sales in this first quarter, while they were 40 percent of the transactions over the course of the entire 2015 sales year.
While the stream of people coming to the Mother Lode, pondering second home purchases continues to be steady, it is not on any upswing, according to Burkhardt. Although the area remains a desirable destination, she is quick to point out current challenges; among them the continuing drought and the increase in pervasive tree mortality, especially on properties in the higher elevations. “If a potential buyer looks at a property and sees a lot of dead trees, it is certainly going to kill the deal,” she says wryly.
Some Statewide Trends
Statewide, Burkhardt alludes to a rising trend in real estate investing, showing more buyers turning to niche properties over home purchases, which provides buyers and sellers here in the Mother Lode food for future thought. More details are reflected in the findings of the CAR 2016 survey of members who interact with real estate investors. It indicates that ten percent of investors purchased commercial, land, mobile homes, or other types of properties in the past year, a three percent rise from the previous year.
Given a lack of inventory of distressed homes on the market — and other real estate deals increasingly harder to find across the state — the share of single and multi-family homes purchased by investors has been declining gradually since 2013, according to the survey. While current figures indicate that 70 percent of investors purchased single-family homes, that figure is down eight percent from three years ago.
Interestingly enough, about ten percent bought commercial properties, land, mobile homes and other properties, which is three percent more than in the previous year. Of the reasons investors cited for their purchases, 38 percent did so for “good location”; 30 percent cited that it was due to the rate of return; 17 percent bought due to “good price”; seven percent for future development potential.
Holding Vs. Flipping
In other findings, the CAR investor survey found that 26 percent of investors are property-flipping, same as last year, but down four percent from the year before. More than three-quarters remodeled their properties, with the spending median at $13,500, up $3,500 from last year.
More than three-quarters of the investors surveyed believe their properties would increase in value in one year, although they are planning to hold them for over eight years now, whereas last year’s average planned hold was six years.
Too, more investors are financing properties. The survey indicates the current level is 45 percent, an 11 percent jump from last year. The inverse is true of cash payers, who decreased to 55 percent from 66 percent the previous year. Approximately 46 percent of investors said the primary source of their cash funds came from personal savings; proceeds from a previous investment or from private investors each came in at 19 percent.