Sacramento's housing prices have tiptoed into positive territory for the first time in more than three years.
In November, Sacramento County's median sales price for resale homes rose from the same time a year earlier - the first time that's happened since May 2006.
La Jolla-based property researcher MDA DataQuick on Thursday pegged the county's November median sales price at $177,000 - up slightly from $175,000 in November 2008. The change in direction comes after 41 months of declines that slashed county prices by 55 percent from their mid-2005 peaks.
Though an encouraging signal that the free-fall in sales prices has ended, other factors are still adding stress in the real estate market. These include 12.3 percent unemployment in the capital region and widespread wage cuts that have sent 90-day mortgage delinquency rates skyrocketing to 11 percent, according to First American CoreLogic.
Nonetheless, November looked better than last year.
"This is the same across much of the state," said DataQuick analyst Andrew LePage. "At this point last year these price numbers were ridiculously low. Those were highly unusual markets with foreclosures ruling the day."
Fewer foreclosure sales and more sales in pricier areas pushed Bay Area median values higher than last year for a second straight month to $387,000. The median is where half the homes cost more and half cost less. The Los Angeles region's year-over-year median price of $280,000 also steadied for the first time since September 2007.
What's driving this change?
"It's a very complicated answer," said Coldwell Banker real estate agent Carlos Kozlowski of Sacramento. In short, the cheap bank repos that accounted for 69 percent of sales last November in Sacramento County fell to 49 percent last month. Simultaneously, higher-cost home sales doubled in Land Park and east Sacramento from November 2008 to November 2009, DataQuick reported. Finally, banks are fixing up the houses they repossess so they can be sold at higher prices, Kozlowski said.
"Banks have discovered if they fix them, they are selling to first-time buyers instead of investors," said Kozlowski. "First-time buyers are willing to pay more than investors."
Investors are doing the same thing with their own repo buys.
Emma Harper was one of 3,183 homebuyers in the eight-county capital region in November. She paid $135,000 to an investor for a house bought early this year for $85,000 then rebuilt to sell to someone like her.
Harper will host her first family Christmas at the south Sacramento house. She said Thursday: "I've been saving since I was 18, and got a little help from the family. Now that I'm living there I just feel like it's a dream come true."
Across the capital region, November's median prices for new and existing homes combined stayed below the same time last year. Yuba County came closest to breaking the barrier, seeing a 0.5 percent year-over-year decline.
November's overall sales tally was down from 3,670 in October. Sales normally fall in November from October as the winter slowdown sets in.
But area real estate agents say many people are looking for houses, lured by affordable prices, 30-year loan rates below 5 percent and an extension until April 30 of an $8,000 tax credit. Many, like Harper, were priced out for years, and didn't expect they could buy. They are now shopping seriously.
"Everyone is game for whatever it takes to move in before the expiration of that tax credit," said Rosanna Garcia, an agent with Garcia Realty in Sacramento.
In Elk Grove, Keller Williams agent Chris Saizan said banks also are making it easier to buy short sale properties. Those are sales in which banks accept less than owed to avoid foreclosure costs.
The Sacramento Association of Realtors reported that 21.5 percent of November sales in Sacramento County and West Sacramento were short sales.
"Banks are working a lot quicker," he said. Saizan said some banks are doing them in 90 days or less, compared to twice that time earlier this year.
With 2009 nearing its end, escrow closings in the first 11 months now total 37,084 in the eight-county region, according to DataQuick. That's 198 fewer closings than the same 11 months of 2008.
But statistics show its 6,257 more closings than the same time in 2007, a year when values collapsed quickly, scaring off many would-be buyers.
--Call The Sacramento Bee's Jim Wasserman, (916) 321-1102 or email him at [email protected]. Read his blog on real estate, Home Front, at www.sacbee.com/blogs.