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Placer County home values plummet

Sales of lower-priced houses are driving the local market
By: Andrew DiLuccia Journal Real Estate Editor
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Placer County hasn’t seen a median home price in the $270,000 range since 2002, and that isn’t necessarily a bad thing. Due to high activity and a crush of buyers — many first-time — in the lower end of the real estate market, the median price for a home has been pushed down to $270,000 in January, according to the Placer County Association of Realtors’ recent report. At the height of the real estate boom, the median home price peaked at $517,500 in August of 2005 for the county. The median home price is the point where half the homes sell below and half sell above a certain number, and whatever direction the median tilts toward is based on activity on either side. “When the median drops it means there’s huge activity in the lower end, such that it pulled the median down,” said Cathy Asbury, senior executive associate with Lyon Real Estate in Auburn. In the Auburn area the median price for January dropped to $244,665, down from $418,000 a year ago, according to the Placer County Association of Realtors. The region also saw 21 homes sell for the month, as opposed to 24 a year ago. Auburn has also seen an increase in listings to 256, a jump of 20 from January ’08. The Colfax/-Meadow Vista region and surrounding areas saw increases in sales with 14 properties sold last month, compared to just eight a year ago. However, the median dropped from $432,250 in January 2008 to $222,500 last month. As home prices continue to push downward, this doesn’t mean that everyone’s home is going to drop to such low points as the $270,000 median for January. Jack Amick, manager of Windermere Real Estate in Auburn, said that homeowners and sellers need to understand that just because selling activity is high in low-end markets that doesn’t mean their home is worth the same. “I think it’s unfortunate that some people misunderstand what these numbers mean — it’s what’s selling,” Amick said. “If you don’t have to sell, then don’t, this is not the time to put the house on the market.” Amick and Asbury agree also that there might be some growth toward the stabilization of the market, which will help home values down the line. “It’s an interesting time, it’s not the end of the Earth, either,” Amick said. “Of course the problem is, if you bought your house in 2005 and it’s worth less than you owe.” Real estate professionals and the Placer County Association of Realtors statistics bear out that a lot of the activity in the lower end of price range, $250,000 to $299,999 (54 houses sold at 21 percent of market), is taking place in south Placer County. Cities such as Roseville and Lincoln have seen sales increases in January 2009 from a year ago, while at the same time saw median sales price numbers range in the $260,000 to $277,900 range. That change has allowed many to take advantage of what the market is offering. “I can finally afford a house instead of just a condo,” said Sharon Gracia, who is selling her condo in Roseville and looking to buy her first home. In the market’s boom Gracia said her condo was worth as much as $250,000, but homes were still over $400,000, making it tough to buy. Now, with condos in her complex selling for $105,000, it’s still easier to buy homes that are priced at $230,000. “It makes me want to jump on it because I know everything is going to go up,” Gracia said. There’s challenges and opportunities for buyers and sellers Asbury said, but right now it seems buyers are still getting the most out of the market. “The buyers right now are in the driver seat, and the buyers are dictating the market,” Amick said. “And they’re saying, ‘I don’t want the deal of the day, I want the deal of the century.’” The Journal’s Andrew DiLuccia can be reached andrewd@goldcountrymedia.com, or post a comment online at Auburnjournal.com.