Have you heard? Real estate in Northern California is booming! Especially in the Sacramento housing market, which was actually among the hardest hit of any in the country during the collapse of the housing bubble.
Over the past year, the Sacramento area has actually had the largest gains of any metro region. Data suggests that sagging housing prices, are beginning to rebound with incredible strength.
Five of the top 10 cities with the fastest national growth are located in Northern California and two more are in the Southern California.
During much of the 2000s, loose financing had led to an oversupply of housing being built in the San Francisco Bay Area’s far outlying suburbs. Since the crash, there had been very little new construction, so when demand naturally increased due to the gradually improving economy, supply hadn’t been able to keep up and prices have jumped.
Not only did Sacramento have the biggest gain in home list prices over the course of the past year, but it also had the largest percentage of its listed houses go off the market, an inventory reduction of just over two-thirds. Nevertheless, Sacramento’s median listing price is still well below its mid-bubble 2006 peak.
Wracked by foreclosures and a flood of underwater mortgages, Housing price gains can’t come soon enough for many homeowners in the region.
Many of the other Northern California cities sitting atop the list owe their rapid price increases to a fairly different set of factors than those underlying Sacramento’s swift ascent. San Francisco, Santa Barbara and San Jose, have largely retained their value during the recession and owe the continued strength of their real estate markets to their booming economies where high-income people want to live.
While San Francisco only had the third-highest jump in housing prices over the past year, the report found that the City by the Bay had, far and away, the highest median home sale price in the country of $749,000 — about double the median price of buying a home in New York City.