Sacramento Housing Prices Rising, Prompting Bubble Concern
SACRAMENTO (CBS13) — Home prices in the state are on the rise, but some experts argue it could be an indication of the beginning of a new bubble forming.
Elk Grove real-estate agent Kevin Cooper attributes the surge to investors capitalizing on the 2008 housing crash.
"We hit bottom in 2012, but some investors came in and bought up the market, driving up the prices of homes."
He says many of his clients who were once underwater are either breaking even or cashing in now.
"Our clients have been very pleased with the amount we have been able to get for them," he said.
Holly Brickner, who works for Lyon Real Estate in Natomas, is also benefitting from the market bump. But she's concerned about how quickly prices are rising.
She says buyers are now willing to pay tens of thousands of dollars above appraisal or asking price because inventory has plummeted.
Last March, there were 551 homes listed in Sacramento County. That number has dropped to just 95 listed in May.
She believes government foreclosure assistance programs are shrinking inventory, forcing buyers to become desperate.
"I do believe there are government programs that are allowing the banks and incenting the banks to hold on to their homes that would have been foreclosed on already," she said.
"I would say there's a bubble risk right now. Inventory is rising too quickly, so it has to cool off a little bit."
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