1. Sacramento Housing Market Forecast Appraisal Institute
the gregory group
Sacramento Housing Market Forecast
Appraisal Institute
February 8, 2018

2. New-Home Pricing—Coastal: Bay Area $1,033,156 Orange County $1,132,036
Two California’s
New-Home Pricing—Coastal:
Bay Area $1,033,156
Orange County $1,132,036
New-Home Pricing—Inland:
Central Valley $367,184
Sacramento $515,562
© 2018 The Gregory Group

3. Source: Department of Agriculture, The Gregory Group
Natural Amenity Score Versus Average New-Home Price
Sacramento
© 2018 The Gregory Group
Source: Department of Agriculture, The Gregory Group

4. Source: California Department of Finance, The Gregory Group
Sacramento Population Change
© 2018 The Gregory Group
Source: California Department of Finance, The Gregory Group

5. Source: Multiple Listing Service
Number of Listings Versus Number of Sales
2005 – 2011
Average Listings = 10,223
Average Sales = 2,215 (22%)
Average Listings = 4,346
Average Sales = 2,239 (52%)
Average Listings = 4,100
Average Sales = 2,321 (57%)
© 2018 The Gregory Group
Source: Multiple Listing Service

6. Existing Home Average Days on Market
Selected Markets (DOM)
Folsom – 32 Days
Elk Grove – 22 Days
Roseville – 27 Days
Davis – 38 Days
East Sacramento – 31 Days
Natomas – 27 Days
© 2018 The Gregory Group
Source: Multiple Listing Service

7. Source: Multiple Listing Service
Months of Inventory
© 2018 The Gregory Group
Source: Multiple Listing Service

8. Existing Home Average Sales Price
December 2017 ($428,000) is 91% of the high ($472,000) June 2006
© 2018 The Gregory Group
Source: Multiple Listing Service

9. Source: Multiple Listing Service
REO Sales/Short Sales/Non-Distressed Sales
December 2017 = 2.68%
© 2018 The Gregory Group
Source: Multiple Listing Service

10. Source: Zillow Real Estate Research, The Gregory Group
Percentage of Homes with Negative Equity
51% 7%
© 2018 The Gregory Group
Source: Zillow Real Estate Research, The Gregory Group

11. Source: Multiple Listing Service, The Gregory Group
New Home Price Versus Existing Home Price
Average 22% Difference
Q1/2001 – Q2/2006
Average 39% Difference
Q1/2009 – Q4/2017
However:
2016 – 2017: 25%
2017: 22%
© 2018 The Gregory Group
Source: Multiple Listing Service, The Gregory Group

12. Source: Zillow, The Gregory Group
Existing Home Price to Household Income Ratio
© 2018 The Gregory Group
Source: Zillow, The Gregory Group

13. Source: Zillow Real Estate Research, The Gregory Group
Percentage of Income that goes toward a Mortgage
Long Term Average = 31%
Q3/2017 = 25%
© 2018 The Gregory Group
Source: Zillow Real Estate Research, The Gregory Group

14. Source: US Census, The Gregory Group
Building Permits
1991 – 1997 (Seven Years)
Average = 9,763
2009 – 2014 (Six Years)
Average = 3,454
© 2018 The Gregory Group
Source: US Census, The Gregory Group

15. Source: The Gregory Group
New Home Sales
© 2018 The Gregory Group
Source: The Gregory Group

16. Source: The Gregory Group
New Home Sales Per Project Per Quarter
© 2018 The Gregory Group
Source: The Gregory Group

17. Source: The Gregory Group
82.2%
© 2018 The Gregory Group
Source: The Gregory Group

18. Current Price (4Q/2017) = $515,562 (103%)
New Home Pricing
Previous High (2Q/2006) = $498,027
Current Price (4Q/2017) = $515,562 (103%)
© 2018 The Gregory Group
Source: The Gregory Group

19. New Home Sales By Price Range
Q4/2005
Q4/2017
252 Total Projects
161 Total Projects
38 Attached Projects (15.1%)
4 Attached Projects (2.5%)
65 Projects on Lots < 4,000 SF (25.8%)
52 Projects on Lots < 4,000 SF (32.3%)
17 Projects w/Average Price < $300,000 (6.7%)
3 Projects w/Average Price < $300,000 (1.9%)
© 2018 The Gregory Group
Source: The Gregory Group

20. Source: The Gregory Group
Home Size and Price Per Square Foot
© 2018 The Gregory Group
Source: The Gregory Group

21. Source: The Gregory Group
Top ten communities account for 80.8% of all new-home sales
Only one top ten community has an average price that is less than $400,000
Only three top ten communities have an average price that is less than $500,000
© 2018 The Gregory Group
Source: The Gregory Group

22. Source: Zillow, The Gregory Group
New Home Price to Household Income Ratio
© 2018 The Gregory Group
Source: Zillow, The Gregory Group

23. Source: The Gregory Group
New Home Inventory
Long-Term Average
1,710 Units
186 Projects
2,326 Units
214 Projects
© 2018 The Gregory Group
Source: The Gregory Group

24. Estimated Number of Units
Proposed Projects
Major Growth Areas
Estimated Number of Units
Folsom
12,573
El Dorado Hills
8,244
Rancho Cordova
39,934
Vineyard/Highway 16
48,811
Laguna
6,571
Natomas
4,046
Placer County
85,021
West Sacramento
13,659
Sutter/Yuba
42,000
Total (Not Inclusive):
260,859
© 2018 The Gregory Group
Source: The Gregory Group

25. Challenges and Opportunities
Costs
Labor
Materials
Cost increases versus home price increases
A resurgence in small lot detached (and attached--coming soon in greater numbers)
Bay Area Buyer—They’re Back!
First-Time/Last-Time—Its All About Demographics
An abundance of future projects
Placer County
Highway 50 corridor
Sutter/Yuba
West Sacramento
…But homebuilders only want Finished Lots
© 2018 The Gregory Group

26. Source: The Gregory Group
New Home Sales -- Projection
© 2018 The Gregory Group
Source: The Gregory Group

27. Source: The Gregory Group
New Home Price -- Projection
© 2018 The Gregory Group
Source: The Gregory Group

28. Real Estate Information and Consulting Services
the gregory group
Real Estate Information and Consulting Services
Folsom
101 Parkshore Drive, Suite 100
Folsom, CA
(916)
Aliso Viejo
120 Vantis, Suite 300
Aliso Viejo, CA
(949)