Sacramento area home prices are still down close to 50% from their market highs, and interest rates are still near historic lows.
But, investors and other potential buyers are doing the math and snatching up homes not long after theyâve hit the market.
"Itâs a real fight out there, a lot of buyers out there fighting for low inventory,â said Patrick Shea, the President and COO of Lyon Real Estate.
Since January, Shea says the median price in Sacramento, Yolo, El Dorado and Placer County has increased by 16%. In that same time period, the market has seen a 43% decrease in the number of new homes being listed to sell.
"We are at historically low inventory levels, because even 5 to 6 years ago when we had a very hot market and low re-sell inventory, we had a very robust new construction inventory around town that we don't have any longer,â Shea said.
Besides low inventory, low prices and low rates have attracted a lot of new buyers. These new buyers are now competing with themselves and cash investors.
"The cash buyers have been a little disheartened by the stock market because they've seen very little return with that, and they see an opportunity to buy an investment property,â said real estate agent Michael Brickner.
"We have a voracious appetite by investors to acquire property in this region. 37% of all deals that closed were by investors,â Shea said.
For new buyers coming into the market, patience, perseverance, and a higher than listed offer are mandatory traits.
âWe were just in a home listed at $275,000 and while we were looking at it an offer came in for $325,000 â" cash,â Clem Cantil, a buyer, said.