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Wednesday, May 2, 2018

May 2018 Market Update


Click here to watch Josh's video blog for the month of May.

From The Desk Of Josh Barker @ RE/MAX

This year represents the 6th consecutive year of appreciation in the housing market in Shasta County. However, not all price ranges are performing the same. For example, for homes under $300,000, it is still a sellers’ market. If you are a home buyer shopping in this price range, it is easy to find yourself in a situation where there are multiple offers on the property you are interested in purchasing. If you have participated in any “multiple offer” situations recently it is a frustrating feeling for sure. With very little construction taking place in this price range, this is likely to remain the case for the next several years. Check the value of your home instantly at www.shastahomevalue.com.

The upper-end market over $450,000 has not performed as well. Although there are sales taking place at a higher rate in this price range than years past, appreciation has been visibly lower. There are several contributing factors. First, with the cost of new construction on the rise, many builders have been pushed into building higher priced homes in order to realize a modest profit. These new homes can shift demand from existing resale homes towards new construction. Secondly, due to a visible ceiling on local wages, there are far fewer buyers available to purchase these higher priced homes. Out of town buyers have been the silver lining in maintaining stability in the upper-end price range.


The middle market between $300,000 and $450,000 has surely been a mixed bag. This price range has experienced some appreciation but has also been visibly picky. Not all neighborhoods have performed the same and unlike the lower price ranges, the condition of these homes has a major impact on the final selling price.


In nearly every area of the county, the cost of renting has increased and is dangerously close to being unaffordable. With very few affordable housing projects on the books and the lack of higher density housing being constructed, the crunch on rent affordability will likely continue. The affordable rent crisis that is likely coming is the primary reason I am such a strong advocate for purchasing a home when the opportunity presents itself. Locking in a fixed living expense has always been the safest way to obtain wealth, and since you are paying for housing, either way, it’s always a good idea to pay yourself.


Lending guidelines are loosening. Many buyers are much more educated than in years past when it comes to financing. Some of these buyers have already been through a short sale or foreclosure in the past and are much more conscious about purchasing homes that they can actually afford. Clearly, this is a good thing and lenders have slowly loosened guidelines to welcome these types of buyers back into the market. With this added supply of home buyers and the boost of a strong economy, the FED is raising interest rates. Experts all agree that rates will continue to rise and the Fed has continued to forecast this intention in order to reduce surprises. 

The next housing market correction for Shasta County will not likely be as dramatic as you may think.  First, home buyers in today's market are using fixed mortgages to purchase homes. It was the interest only, negative amortization, and balloon payment loans that contributed to the last housing bust. Second, the lack of abundant new home construction in our local market will keep the supply of homes in check. Finally, the next housing correction will likely be more psychological than factual. After a long run of home appreciation, it is likely that some “would be home buyers” will want to wait for prices to drop. This reduction in buyer demand may have a temporary impact on the number of home sales and home prices in turn.  Although this may occur on some small scale, once it is clear that there will not be a “housing crash” home prices will likely stabilize again quickly. For those that have been around real estate for decades, none of what I am saying is new, it is simply a real estate cycle.


As always, if you have any questions, please feel free to respond to this email or contact me at 530-222-3800.

Have a great May!

Josh Barker

Wednesday, April 4, 2018

April 2018 Market Update




Click Here to watch Josh's video blog for the month of March.

From The Desk Of Josh Barker at RE/MAX,
The real estate market has continued to perform well in the first quarter. Sales are strong and prices are inching up in most price ranges. The spring is sure to bring lots of new homes to the market for sale and a large supply of buyers ready to purchase. This month we will review several of the hottest topics trending now. As always, feel free to contact me with any additional questions. Have a great start to spring!

Your Realtor,
Josh Barker


Interest Rates
Interest rates appear to be one of the hottest topics buzzing around the market at this time. Last year, the average 30-year mortgage interest rate was averaging just below 4%. Currently, the average rate is averaging 4.75% for the same 30-year fixed mortgage. For those that have seen interest rates much higher in the past, this may not sound like a big deal. However, home appreciation in Shasta County can be impacted by higher interest rates. If a home buyer's purchasing power is impacted by rising rates, it could have an impact on demand, which in turn can impact appreciation. We will be watching this closely in the months to come.




Home Sales
Home sales in the month of March declined to 235 compared to 267 sales the year before. This year home sales started well ahead of the previous year. However, the year-to-date home sales of 652 have remained the same year over year. Clearly, the year to date sales is good news. We will have to watch the month of April closely to see if we are developing a declining trend or if March was an anomaly. If the trend continues, it may be the first sign that the rise in interest rates is having a negative impact.




New Construction
New construction in Shasta County is beginning to pick up some steam. Most of the attention for new construction is focused around Salt Creek in West Redding, off Airport Road in East Redding, and behind the Walmart in Anderson. There are several additional projects scattered around other areas as well. We are on pace to exceed housing starts throughout the county compared to last year. This is a great addition to the local market. Not only does new construction create jobs, it also eases the burden on an already tight housing market.

Check out the new construction by visiting www.reddinghomes.com/new-construction.

Rental Market
If you have been on the hunt for a rental, I do not need to tell you how tight the rental market is. The vacancy rate is far below historical averages and I would venture to say it is the tightest I have seen it since the year 2000. Rental rates have increased quickly, and from the looks of it, rates are likely to rise more. The State, Shasta County, and the City of Redding have all recognized the problems that this creates and the impact it has on the cost of living. I expect to see re-zoning, building fee incentives, and smoother approval processes in the future. If the City of Redding gets ahead of this issue quickly, there will be a real opportunity to ease the rental rate burden and create an even more attractive incentive to live in our beautiful community.



Home Values
The average sales price in Shasta County is currently averaging around $267,000 per year to date compared to $265,000 one year ago. The lower end market has experienced the most appreciation over the last year. Higher priced homes have appreciated far less but have been selling at a higher pace compared to years past.

You can check the value of your home instantly by visiting www.shastahomevalue.com


On a personal note, I wanted to share that because of you and your amazing referrals, we were ranked #1 in the RE/MAX network for the state of California in 2017. This is only possible because of the great clients we have had the privilege to serve. On behalf of our entire team, we would all like to say thank you for all your support and for entrusting us with your referrals. We appreciate you very much. As always, if you have any questions, please feel free to respond to this email or contact me at 530-222-3800.


Have a great April!


Josh Barker

Friday, March 2, 2018

March 2018 Market Update


Click Here to watch Josh's video blog for the month of March

From the desk of Josh Barker,
First and foremost, Thank You! Thank you for all of the great responses we receive from these monthly market updates. I appreciate your feedback and questions. It truly makes these updates a lot of fun to prepare each month. 
This month I will be reviewing several of the hottest topics trending now in our local market. Enjoy the information. If you have any questions please feel free to contact me. 
Have a great start to March!
Your Realtor,
Josh Barker

Home Inventory
Home inventory in Shasta County has remained extremely stable for the first 2 months of the year. Numbers are averaging nearly 840 homes for sale compared to 850 homes just 1 year ago. The stable supply of homes is providing much-needed inventory for buyers to choose from and is also keeping home appreciation at healthy levels. 
Interest Rates
Interest rates are currently averaging near 4.5% for a 30 year fixed mortgage. This rate change is a noticeable increase from the 3.75% interest rates of less than 1 year ago. Interest rates will continue to be a factor that will have to be watched closely. When the interest rates increase by just 1%, the borrower's purchasing power is reduced by approximately 10%. Higher interest rate environments can eat away at home appreciation in a market like Shasta County.  
Rental Market
Vacancy rates (the percentage of homes waiting to be rented) have remained very low in the residential rental market. This low rate has translated into higher rent and shorter turn over periods. With the continued squeeze on new housing, rental properties are in extremely high demand and there is no sign of this changing anytime soon. If you are considering purchasing a rental or converting a home you currently live in into a rental, now may be an excellent time to do it.
Home Appreciation
It is still too early in the year to report on home appreciation for 2018. We will be closely watching the new listings coming to the market in the early spring. We can typically expect to see home sellers test the market a bit and push asking prices a little higher than the previous year. If it works, homes will sell for more money. If it does not work, we can expect to see price reductions starting in late spring...I will report back on this topic in a few months.
In the meantime, if you would like to check the approximate value of your home instantly, visit www.shastahomevalue.com. I pay for this service each month and offer it to all of you for free. It is by far the best home value estimate I have been able to get my hands on.
Thanks again for reading and, of course, if you have any questions about buying or selling a home, feel free to contact me directly at 530-222-3800.
Make it a great day!
Josh Barker

Monday, February 5, 2018

February 2018 Market Update


Click Here to watch Josh's video blog for the month of February

From The Desk Of Josh Barker,
The weather in the Redding area is amazing! We are surrounded by snow capped mountains, the air is crisp and clear, and people are out and about enjoying all the beautiful activities the Northstate has to offer. Many home buyers are out shopping early this year largely due to the weather as well. This month we will discuss several of the hottest topics trending now in our local market. Enjoy the information and of course feel free to contact me with any additional questions.
Your Realtor,
Josh Barker

Home Sales
Home sales in January started out strong and mirrored the sales volume of January of last year, finishing at 200 home sales. The noticeable change was in the pending home sales. In January there were 276 homes that went into escrow, up 34% compared to last January. The increase in pending home sales I believe can be contributed to the favorable weather. Last year, we had a lot of rain in the first quarter of the year.

February 2018 Home Sales in Shasta County

Home Inventory
Home inventory nationally is continuing to trend down. This reduction in "supply" is causing home prices to increase and is having an impact of affordability in larger markets. Locally, home inventory is averaging near 815 homes for sale down by 4% compared to last year. The stability in home inventory locally is allowing for modest appreciation and is keeping home affordability in check.  


Interest Rates
Interest rates have trended up over the last 6 months. 6 months ago the average 30 year fixed mortgaged averaged around 4%. Currently 30 year fixed mortgages are averaging 4.5%. Clearly interest rates play a role in overall home prices in our local market due to the fact that over 80% of all local purchases involve bank financing. For every 1% that the 30 year mortgage rate increases, the average home buyers borrowing power is reduced by up to 10%.  

30 Year Fixed Mortgage Rates by Freddie Mac

New Construction
New construction in the Redding area is continuing to increase. New housing permits for 2017 in the city of Redding finished at 150 permits pulled up 10% compared to 2016. It is projected that we will see even a higher rate of new construction in 2018 as home prices increase, allow for builders to take the calculated risk of building at a higher rate.

City of Redding New Construction

City of Redding Fees and Permits
The City of Redding has taken a proactive approach to new construction and slashed fees associated with building permits. This is a very proactive step towards stimulating the housing economy and will contribute to overall home affordability in the long term. I truly believe that the best way to provide affordability housing to our local market is to simply increase the supply of homes available. It's a simple example of "supply and demand".

New Home Sales

The Spring Rush
Typically we experience an increase of homes coming to the market for sale in the spring. If you are considering selling your home this year, or if you are considering a home improvement before listing your home for sale, let's talk. I can assist you in determining the best approach. Designing a plan up-front could put thousands of additional dollars in your pocket at closing.

Check Your Home's Value Instantly!
If you would like to check the value of your home instantly, check out our free home valuation tool that is designed for our local market. www.shastahomevalue.com 

If you would like to review my marketing plan designed to sell your home at the highest price visit www.reddinghomes.com/selling-your-home

I want to take a moment and say thank you for all the amazing referrals that you have sent my way over the years. We appreciate your support and look forward to assisting you with all of your real estate questions and needs in the future. 

Make it a great February!

Your local Realtor,
Josh Barker

RE/MAX Town & Country
Lic#01277485

530-222-3800
530-215-2980 (fax)

www.reddinghomes.com
www.shastahomevalue.com

Tuesday, January 9, 2018

January 2018 Market Update

From the desk of Josh Barker @ RE/MAX

Click Here to watch Josh's video blog for the month of December

First and foremost Happy New Year! 

As I like to do each January is briefly talk about how the Shasta County Real Estate Market performed in 2017. The housing market in Shasta County remained strong throughout 2017 (even in the historically slower Winter months). In fact, home sales have increased year over year for the 3rd year in a row. With a large influx of buyers continuing to enter the market there has been an increased demand combined with a limited supply of homes for sale. This classic example of supply and demand has resulted in Redding home prices rising by an average of over 6%. 



The local Shasta County Board of Realtors released the year end report for 2017 and it shows a very minimal change as you can see by the slides below. 




Curious what your home may be worth in today’s market?
Get an Instant Home Value at www.shastahomevalue.com.



With the increase of home buyers and limited supply of homes for sale in Redding and surrounding areas, there has also been a dramatic reduction, of how long a home spends on the market. In 2016, the average days on the market (DOM) was 118. In 2017, that number has dropped to an average of 102, with many homes selling within days of going on the Multiple Listing Service (MLS).


Our proven home marketing strategies showcase your home in the best possible light to hundreds of qualified local buyers.

For more information on how we can help sell your home for more money in less time visit www.reddinghomes.com/selling-your-home.


What to expect in 2018…
Based on all of the indicators; sales volume, home prices and home inventory, we can expect to see a stable real estate market as we did in 2017. With home prices increasing this gives new home builders a margin in which to obtain a property, build the home, and sell for a modest profit. So we could begin to see more new construction starting this year and are able to assist with those current homeowners looking to move up to a newer, nicer home.

Let’s make 2018 the year for your family to move up to a newer, nicer home! If you’re ready to make that move, give us a call at (530) 222-3800 or email me directly at josh@reddinghomes.com I would be happy to discuss the options available.

Have a great start to 2018!

Your local Realtor,
Josh Barker

Tuesday, December 5, 2017

December 2017 Market Update

From the desk of Josh Barker @ RE/MAX

The new TAX PLAN and what it means for homeowners in Shasta County.

As I am sure many of you have heard, the tax plan is likely going to be approved by the end of the year. What some of you may not of heard is that there are some real changes proposed to the capital gains exemptions.

Currently if you own a home, and have lived in the home, as your primary residence for 2 years or more out of the past 5 years, you may qualify for a tax exemption for up to $500,000 of the profit. 

The new tax plan currently being proposed has language that could change the exemption of 2 years out of the past 5 years and replace it with the requirement of living in the home for 5 years out of the past 8 years. High income earners may have additional provisions to qualify for the exemption as well.

Imagine that you have lived in your home for 3 years, the home has increased in value and you expect a profit of $50,000. Currently, many home owners would simply take the profit and use it as a portion of the down payment on the purchase of another home. With the new tax plan, this transaction could trigger a taxable event on the profit gained from the sale of the home. This "new tax" would need to be factored into the viability of the next home purchase.

If you currently own a home and are thinking of selling you need to watch this video!

Click Here to watch Josh's video blog for the month of December

Bottom Line
The existing capital gains exemption is changing from a 2 year requirement to a 5 year requirement for owner occupied homes.

When selling a home consider the taxes that may be triggered as a result. You may have less money than you expected for the down payment for your next home.

Home Market Update for Shasta County

For those that enjoy our market reports, I have included a slide that reports on the number of home sales broken down by price range.


The average sales price in November for a home is averaging $275,000 compared to $265,000 in November of last year.

The median sales price for December for a home is averaging $247,000 compared to $248,000 in November of last year.

Year to date closed sales for the Shasta County market are approximately 2,924 compared to 2,844 year for the same period last year.  


You can check the approximate value of your home instantly at www.shastahomevalue.com

Shasta County Home Values

If you have any additional questions regarding real estate please feel free to email me at josh@reddinghomes.com or contact me directly at 530-222-3800.

Merry Christmas and Happy New Year!

Your local Realtor,
Josh Barker

Monday, November 6, 2017

November 2017 Market Update

From the desk of Josh Barker @ RE/MAX

As we enter the Holiday Season in Shasta County we can look back on how this year has transpired in regards to real estate. For those of you who keep an eye on our local area housing market we can clearly see that Shasta County home sales have outperformed last year by nearly 3% year to date. However, active inventory has remained steady throughout the year.  

If you own a property which requires a septic system, you need to watch this video!

Click Here to watch Josh's video blog for the month of November

There are changes that are coming to Shasta County in relation to septic systems. In the year 2000, there was a water situation that took place in the Santa Barbara area. As a result, there was water contamination and the State of California required the Water Quality Control Board to conduct an Environmental Impact Study to determine what the best measures would be to protect our water systems as a State. However we all know Santa Barbara is entirely different than Shasta County. The solution found by the State required a separation between ground water and all septic systems in order to prevent contamination. They determined that a separation of between 4 and 20 feet be applied. If we applied that new requirement here in Shasta County it is likely very few homes would actually qualify to have a septic system at all, or one that would be economically feasible to install. 

After this determination by the State, each County responded to the Water Quality Control Board with comments as to why each area would not be able to apply the stringent new requirements. Out of the comments made by local counties, a new program was adopted called LAMP, (Local Area Management Program) and each county was responsible for submitting their own report about how they planned to protect the local water system itself. 

Shasta County New Water Quality Regulations

Currently in Shasta County the minimum separation between groundwater and a septic system is 1 foot. Beginning in May, 2018 that requirement is going to change. The increase will be from 1 foot to 2 feet of separation. This may seem like a very small change, but will have a big impact on existing septic systems as well as new systems being installed in the future. We are likely going to see septic systems becoming more and more shallow. There will need to be additional engineering and design in order to facilitate an operational septic system. Pumps, raised burms, and curtain drains are some of the methods that can be adopted to create a working septic system and still meet the new requirements of LAMP.

If you already own property in Shasta County and you're thinking about selling within the next couple of years, you may want to consider obtaining a septic permit before May 2018. If submitted before May you may be able to remain under the current requirements. If you wait, you may be subject to the new guidelines. If your current system is limping along and maintenance may be needed within the next year, you may want to consider resolving the situation sooner rather than later, before the new requirements become effective. 

If you would like to learn more, I would recommend speaking to the Shasta County Environmental Health Department. The department will be able to walk you through some of the steps that are necessary in order to resolve your particular septic issue or question.

Beyond the county, if you're looking for advice from someone who actually installs septic systems, it is best to get in touch with a Registered Environmental Health Specialist. There are several of these specialists in town that qualify for the designation, and tend to have the most knowledge when it comes to solving problems with septic systems and how to meet those new requirements coming in the future.

As always we're always here to help. If you have any questions at all please give us a call at 530-222-3800 or reply to this email. We can help point you in the right direction.

Your local Realtor,
Josh Barker