Residential sales in Western Nevada County in July 2007 vs. July 2006 fell about 6 percent. In July 2006, 98 homes were sold at an average sale price of $479,969, which was at 96.96 percent of the asking list price of $495,078.
In July 2007, 92 homes were sold at an average sale price of $406,267 which was at 96.37 percent of the asking list price of $421,556. Sales have not really dropped very much, but the average sales price dropped $73,702.
Of course one month does not reflect the true market conditions. Lawrence Yun, NAR senior economist, said “he isn’t looking for any notable changes in sales activity. A modest upturn is projected for existing-home sales toward the end of the year, with broader improvement to include the new-home market by the middle of 2008.”
With increased population growth in California, demand for housing is not going away. New construction has dropped considerably, land is scarce and interest rates are still low. Buyers will have to come into the market place sooner then later. Various reports that I have read expect a yo-yo effect, with nation wide prices dropping 2.3 percent and then rising 2.3 percent next year. Interest rates are expected to be 6.7 percent at the end of the year and ease off to 6.5 percent the beginning of next year. (Source, National Association of Realtors® NAR)