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Pass the turkey to the guy talking about home prices

November 25, 2025 By Ryan Lundquist 13 Comments

Half the homes in the country lost value since last year. This is a big headline from Zillow, and I want to unpack that today before the holiday officially comes. I think it’s important in real estate to understand what people are saying about the market.

UPCOMING SPEAKING GIGS:

12/9/25 Downtown Regional MLS Meeting
12/10/25 SAFE Credit Union (TBA)
1/13/26 Residential RoundUp via Zoom (register here)
1/14/26 Windermere EDH / Placerville
1/20/26 Carlile Group (private event)
2/11/26 San Joaquin County presentation (TBA)
2/20/26 PCAR
3/25/26 Coldwell Banker EDH
4/14/26 Culbertson & Gray
10/2/26 PCAR

HOUSING CONVERSATION AT THE DINNER TABLE

I don’t recommend it, but if conversation isn’t spicy enough on Thursday while you’re with your people, here are some housing topics to bring up. Which one would rile up grandpa the most? Haha.

In all seriousness, I hope you deepen relationships this week. May you be filled with deep joy regardless of your circumstances.

ZILLOW’S SENSATIONAL HEADLINE

Zillow published a piece last week stating 53% of homes in the United States lost value over the past year, and it’s gone viral online. What really caught my eye was the locations with the most losses. Check out Sacramento ranking third on the list with 88% of homes said to have lost value – only behind Denver and Austin. I’m not surprised to see Sacramento make the cut since I’ve been talking about softer prices for many months now. But it’s also easy to get sensational with this headline because it sounds worse than actual market change.

If you’re in one of these top markets, what do you think of these stats?

ACTUAL VALUE DECLINES AREN’T SENSATIONAL

In short, 88% of homes losing value sounds really big, but how much did prices actually go down? Well, Zillow’s price index for Sacramento is down 2.3% from one year ago, and traditional metrics are hovering somewhere around that level depending on the month (they’re bouncing around). I like to say it’s been a slow burn for price change despite glaring affordability issues. Supply just hasn’t built enough to create quick change. I’m not sugarcoating here. I’m only pointing out the 88% headline sounds way more sensational than actual market change. All that said, a positive here is affordability has improved slightly for buyers. This isn’t a major change, but a little relief is welcome.

By the way, I’m not saying Zillow’s numbers are perfect for Sacramento either, though their numbers have been pretty reasonable so far compared to other metrics I’m watching. I’ll keep reporting on many different metrics to help us have a wide view of the trend. I’m also not a Zestimate fanboy, but it’s interesting to consider what percentage of Zestimates have dropped below last year as shown above.

A BIG THANK YOU

Thank you so much for this year. I am beyond grateful for the relationship we’ve built and the business we’ve done together. Thank you for your continual support. I know this has been a tough time in real estate for so many over the past few years, so I don’t take it for granted that I’m surrounded by amazing people who have blessed my life and business.

Thanks for being here. I hope this was helpful.

LEAVING COMMENTS: The captcha is not working perfectly. If you open up a new browser, that should solve the issue. It’s been a problem to comment when clicking from my weekly email. My apologies.

Questions: Which housing topic are you bringing up at Thanksgiving? And does anyone else feel like turkey is overrated?

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Is it still a bedroom if the closet is removed?

November 20, 2025 By Ryan Lundquist 30 Comments

If the owner removes the closet, can it still be counted as a bedroom? I’ve had this question a few times this month, so let’s talk about it. I’ve written before about closets and the definition of a bedroom, but today I want to just focus on eliminating the closet. I’d love to hear your take in the comments.

UPCOMING SPEAKING GIGS:

IS IT STILL A BEDROOM IF THE CLOSET IS REMOVED?

This can be a tricky question because there are so many different scenarios, and each situation might not perfectly fit my answer. In short, if all an owner does is remove a closet, I lean toward saying it is still a bedroom. Let’s be logical. Imagine if you had a four-bedroom home and took out the closets. Is it now a zero-bedroom home? Absolutely not. That sounds absurd because it still has four rooms intended as bedrooms. Yet, it does now have some functional issues since buyers walk through thinking, “Where the heck are the closets?” We just wouldn’t go so far as to say bedrooms no longer exist, right?

If the cost-to-cure is minimal to add a closet, let’s not overthink this issue because it’s unlikely that buyers would deduct a significant amount in value when the cost-to-cure is so small. What we don’t want to do is get so caught up on a closet technicality that we fail to think logically. So, if we now compare a three-bedroom home to two-bedroom comps, we could be choosing the wrong comps and missing the way buyers actually perceive the home. Don’t get me wrong. There could be a big difference in value sometimes between a two-bedroom and three-bedroom home, but if the only difference is literally a closet, that’s not the same thing as comparing a three-bedroom and a traditional two-bedroom that doesn’t have any extra bedroom potential. However, if an owner removes a closet by expanding an adjacent bathroom into that space, there could be a functional problem in an older home with smaller rooms already. This is where it can get weird if adding a closet would mean the bedroom is now tiny, so I get when real estate professionals use good professional judgement at times when deciding if an area is a bedroom or not.

Ultimately, many people say closets are required because that’s what they’ve always been told, but there really isn’t an overarching rule that says so. However, it’s likely the market requires them (or local code). So, on one hand we don’t want to minimize the importance of a closet because it’s normative and expected among buyers. On the other hand, let’s not go to the extreme of being unable to think like buyers who would use logic and find the path of least resistance by spending a minor amount of money to add a closet.

All that said, I wouldn’t split hairs if a colleague wanted to call it something else besides a bedroom because this feels like a gray area where there is room for interpretation. In real estate, we often want things to be black and white and clearly defined, but that’s not always possible. I think the most important issue here is that we’re considering comps with the same room count and functionality (and not being too rigid about removing a closet). No matter what, it’s really important in appraisals and real estate listings to explain what is at the house and be as clear as possible.

Here’s a reel I made on Instagram to talk about this post.

View this post on Instagram

A post shared by Ryan Lundquist (@sacappraiser)

ADVICE TO OWNERS

Don’t remove closets. It makes it awkward, and in today’s market buyers are very picky about everything. If a home has too many oddities, it creates roadblocks for buyers to say yes. Look, do whatever you want. It’s your palace. I’m just saying keeping the closets is a good move. On a related note, people sometimes convert a three-bedroom home into a two-bedroom home by combining bedrooms. That’s not something I advise either from a resale perspective (but do as you wish).

WHAT ABOUT A BUILDER DEN OPTION?

If a home was built with a den, can we consider that a bedroom? Well, we just called it a den, and that signifies it’s something else besides a bedroom. That’s sort of like when someone wants to include a Sun Room as square footage. Bro, you just called it a Sun Room, which tells me it’s something else and probably not square footage. Anyway, the den option almost feels like a bedroom because it has space for a closet and a window to the exterior, but being open to the rest of the house with no privacy makes it a den instead of a bedroom. In this situation, buyers might recognize the potential to convert the area to a bedroom, but it’s also not as cheap as adding a closet since now we have to build an entire wall including a door. In short, I definitely wouldn’t count a den as a bedroom with a situation like this because it doesn’t feel like a bedroom (and buyers wouldn’t call it a bedroom).

EWW, YOU SOUND SO SUBJECTIVE TODAY

I realize my post today feels a bit subjective, but this is what it’s like in the trenches of real estate where we have to use good professional judgement and make subjective calls supported by reason and market perception. I find it’s easy to want to impose one rigid definition on every property, but that just doesn’t work.

DON’T GET TALKED INTO SAYING IT’S A BEDROOM

One final thing. Be careful about being talked into considering an area as a bedroom when the space clearly doesn’t feel like a bedroom or meet the general requirements. At times, sellers will add a closet to an attic and say it’s a bedroom, but it really isn’t permitted square footage. Or imagine an owner converts a den to a full bedroom, but the septic tank is not big enough for an extra bedroom (yikes). Or an owner might add a closet to an office in the interior of the layout, but it doesn’t work as a bedroom since a bedroom needs direct egress to the exterior of the house.

Thanks for being here. I hope this was helpful.

Questions: How would you answer this question? Is there anything I missed?

If you liked this post, subscribe by email (or RSS). Thanks for being here.

50 year mortgages & a housing market update

November 12, 2025 By Ryan Lundquist 53 Comments

A few days ago, President Trump shared the idea of a 50-year mortgage, and it has set the housing narrative on fire to say the least. Let’s talk about this today without getting political, and I also have a big market update with stats for ten counties. Skim quickly or digest slowly.

UPCOMING SPEAKING GIGS:

12/9/25 Downtown Regional MLS Meeting
12/10/25 SAFE Credit Union (TBA)
1/13/26 Residential RoundUp via Zoom (register here)
1/14/26 Windermere EDH / Placerville
2/11/26 San Joaquin County presentation (TBA)
2/20/26 PCAR
3/25/26 Coldwell Banker EDH
4/14/26 Culbertson & Gray
10/2/26 PCAR

50 YEAR MORTGAGES: WHY I’M TALKING ABOUT THIS

I was talking about the fifty-year mortgage this weekend, and someone told me he was disappointed. I think the perception was that I was being anti-Trump because of my opinion, but real estate and politics collide sometimes. Besides, show me any place where housing is being discussed and this topic is not coming up. A few weeks ago I wrote about a tax on the highest prices in Sacramento, so was I attacking liberal policy then? In April 2021, I said mortgage rates were too low, and I suppose that could be interpreted as political. In fact, a loan officer unsubscribed and called me woke. Look, my goal is to talk about anything that can affect the housing market, and I’m hopeful we can have conversation without getting political.

MY THOUGHTS ON A 50-YEAR MORTGAGE

Here’s my take. A fifty-year mortgage can work for some people, but I’m not a fan overall for the general public since this doesn’t do anything meaningful for affordability as it’s a product that can help keep prices higher. This feels like a Band-Aid rather than a solution, and I would much rather see politicians talk about how to unlock supply rather than increase demand or debt. This essentially helps buyers purchase at higher prices today, so it seems like a product that actually favors sellers way more than buyers. I’m concerned about consumers being tied to debt longer and first-time buyers in particular having very little equity after a decade of living in the home (see an amortization calculator). Look, if the market appreciates over time, then maybe less equity is no big deal, but if it doesn’t, that’s problematic. Ultimately, the monthly savings look negligible with a fifty-year mortgage, so it doesn’t feel like a viable solution for the masses. Could it work for some? Of course. Is it good if we have more options in the housing market? Maybe. But we need the right type of policy. Not just any policy. I am all for stirring more housing demand, but not at any cost. Imagine if we brought back all the loans happening before the housing bubble burst. That would absolutely create more demand, but it wouldn’t be a reasonable way forward. This goes to show that we want the right policy. Not any policy.

What do you think? What are the positives and negatives? I’d love to hear in the comments. And please keep it civil and argue about politics elsewhere.

FIVE THINGS TO KNOW ABOUT THE HOUSING MARKET

1) PRICES CONTINUE TO BOUNCE AROUND

“We’re so back.” Friends, the median sales price is flat this month after having been down for five months. But please don’t say the market is back. My advice? Recognize the median can bounce around. I wrote about this last week, and anyone who wants to be a real estate expert needs to be able to talk about this stuff. Otherwise, the housing narrative from month to month is going to sound incredibly manic.

Price stats remind me of Nintendo cheat codes from the ’80s. Prices are up, down, up, down, flat, etc…. For Nintendo, you could get thirty lives in the game Contra if you pressed, “Up, Up, Down, Down, Left, Right, Left, Right, B, A, Start.”

2) THE MARKET IS SOFT, BUT NOT AS SOFT

We’ve had a clear pattern of more sellers coming to the market over the past couple of years, but not so much over the two quarters. Some people look at the decline and call it seasonal, which I understand, but it’s more than that. We were consistently outpacing 2024 during the beginning of the year, and now we’re not. My thesis is sellers have backed off due to economic uncertainty. Whatever the reason, this is why the market feels soft, but not as soft as it did months back when supply was really growing. I’m not saying it’s aggressive out there, but it’s not as dull.

3) SALES ARE JUST AHEAD OF LAST YEAR

The number of sales is just ahead of one year ago. I think we can give this a light golf clap and be thankful for slightly more, but otherwise let’s be real that we’re having a lackluster year of closed sales. I’m not being negative, but realistic. I did a reel about this where I talked about what it’s like emotionally to work in real estate. Friends, put your game face on, position yourself for the market that is here, and be logical that we’re poised to continue to have low volume until we see a sharper change to affordability.

4) IT’S HIBERNATION TIME VERY SOON

Sellers and buyers start to hibernate around the holidays as December is almost always the low point for the number of new listings, pendings, and closed sales (sales bottom in January, but these homes got into contract in December). Anyway, it’s important to be in touch with the seasonal rhythm so we can know what to expect and spot anything abnormal. For buyers, be looking for listings that come to the market at this time of year because sellers are sometimes willing to deal. By the way, this doesn’t mean the market is completely dead for the rest of the year either, so save your hate mail. All I’m saying is we’re about to see the low point of supply and demand for the seasonal market.

5) A GOOD WAY TO DESCRIBE THE HOUSING MARKET

People sometimes ask what 2025 feels like, but it’s sort of its own thing. It’s not 2021. It’s not 2007. And it’s softer than the normal trend in a year like 2019. I think this is a really good way to describe the market right now.

And now some recap stats for anyone interested.

YEAR-OVER-YEAR:

Take price stats with a grain of salt sometimes since they can bounce around a bit right now. But be sure to look at the average home size (last row in each visual). Sometimes stats might be up, but could that be due to larger and more expensive homes selling?

MONTH TO MONTH:

Thanks for being here. I hope this was helpful.

Questions: What do you think of a fifty-year mortgage? What are you seeing in the housing market right now?

If you liked this post, subscribe by email (or RSS). Thanks for being here.

Home prices are all over the place right now

November 6, 2025 By Ryan Lundquist 6 Comments

Home prices are up. No, they’re down. Wait, they’re flat. The stats have been all over the place, so how do we figure out what prices are doing? Today, I want to talk through some ideas for approaching prices in the midst of some confusing stats. This is so important for anyone trying to understand and explain the market in 2025.

UPCOMING SPEAKING GIGS:

11/6/25 Private Zoom
12/9/25 Downtown Regional MLS Meeting
12/10/25 SAFE Credit Union (TBA)
1/13/26 Joel & Mike Event (TBA)
1/14/26 Windermere EDH / Placerville
2/11/26 San Joaquin County presentation (TBA)
2/20/26 PCAR Presentation
3/25/26 Coldwell Banker EDH

WHAT DO A FEW DIFFERENT SOURCES SAY?

It can be confusing when pulling stats right now because not all price metrics are showing the same extra trend. Here are a few sources for the Sacramento region in September 2025 to show what I mean. Is the market down by 2%, or should we say it’s up by 1.85%? More on that below.

Zillow Price Index: -2.46%
Median Sales Price: -1.54%
Average Sales Price: +1.85%
Freddie Mac Price Index: -2.1%

Here’s another example for just Sacramento County. What do we say?

Zillow Price Index: -2.9%
Median Sales Price: -3.8%
Average Sales Price: -0.47%

TRADITIONAL METRICS CAN BOUNCE ALL OVER

Stats can bounce around quite a bit in 2025 since there aren’t as many sales happening. I’m finding the median sales price and average sales price can be pretty noisy from month to month, which is why I’ve been talking more about other metrics too. Imagine being rigid about the median price in Placer County this year. The market is up. No, it’s down. Wait, it’s flat. All over the place!!!

And here’s our largest local county showing a more consistent trend. October 2025 so far looks like it is flat, but I need a few extra days before pushing that out. If it does end flat, it will reinforce exactly what I’m talking about in this post. Today, we have to look beyond just the median because the results aren’t going to sound reasonable sometimes.

SMALLER COUNTIES CAN BE MANIC

Areas without many sales can already bounce around from month to month, but these days we’re missing about 30% of the normal number of sales, so price stats can be even more manic than usual. For example, the average sales price in El Dorado County was recently up over 9% from one year ago. Are prices really up by that much? Nope. Larger more expensive homes sold this year, and that boosted the average sales price.

DECIDING WHICH STATS TO USE…

I’m good if someone says something like, “Prices are down about 2% in the entire region from last year,” because most metrics suggest that. But I would cringe if someone said the market is up 2% by focusing on the average sales price alone. In real estate, there can be bias toward higher prices, so people need to be super careful about gravitating toward hot stats. Yes, it’s technically true the average price is up, but being 2% higher than last year is not the vibe at all when pulling comps. This is where we have to weigh the metrics. Which ones most credibly represent the market trend?

Overall, I find myself taking the median and average price with a grain of salt in today’s market since both can bounce around quite a bit depending on what has sold. The average can be higher too if we have more strength at the top of the market (which we have seen in many markets). Thus, I’m tending to give a little more weight right now to Zillow and Freddie Mac. But the median and average aren’t garbage though. For instance, Zillow’s index shows prices are up 30% from early 2020 in Sacramento County, whereas the median shows 35%. Or Zillow shows prices are down 7.7% from mid-2022, whereas the median sales price shows 6.1%. These are honestly pretty close, but there is a difference, so we want to look at both.

One last thing. I’m comfortable saying the regional market is down by 2% or so this year and Sac County is down 3-4%, but I’m also aware this doesn’t perfectly apply to every type of property. For instance, some condos could be down more.

NEW SKILLS NEEDED FOR TODAY’S MARKET

When the market changes, we sometimes need to add new skills to our bag of tricks or at least think about things differently. Here are some ideas:

1) LOOK AT MULTIPLE PRICE METRICS:

We’re in a different market with a much lower number of sales, so I think we need to rely on more than just one data source for price change. In the past, maybe it was all about the median sales price, but I recommend getting a wider view today just in case the median or average isn’t consistent enough. Check out Zillow, Homes.com, JBREC, Freddie Mac, and other sources. For locals, I’ll be talking about these sources on my blog and socials.

2) BE CAREFUL OF SMALLER AREAS:

You might sound unhinged if you rigidly interpret the median price from month to month in smaller areas. If you’re in a lower-volume county, stay in touch with nearby larger counties that might help get you a better reading for the wider market.

3) DON’T PUT ALL YOUR EGGS IN ONE BASKET OR BECOME A HATER:

People sometimes go all in on the Case Shiller Index or median price or whatever. It’s like they become evangelists for that one metric, but no stat is able to perfectly describe every part of the market at once. Remember, the trend for condos could be different from luxury prices or detached homes. And please don’t be a median price hater without suggesting an alternative. It’s not helpful when people only say, “I hate the median.” Okay, so what should people look at then?

4) STOP LISTENING IF THE RESULTS AREN’T CREDIBLE:

If you find a particular data source isn’t credibly reflecting the trend, then find something better or give that source less weight. So, if you’re looking at Zillow’s index and just not feeling like the results are adequately capturing the trend, then expand your horizons. The other day I heard Lance Lambert of ResiClub share his perception that Zillow’s index was maybe lagging the market in some areas.

5) NOTHING REPLACES LOOKING AT COMPS:

Some price metrics can be helpful to describe the region, but nothing replaces looking at comps. Over the past few years, I’ve found the local median sales price in Sacramento County has been a pretty good indicator for price movement at the lower end of the market, but the very highest prices showed significant growth well beyond what the median price would suggest. So, if we were to rigidly expect median price results at the highest prices, we could really undervalue properties. In other words, we can’t impose any sort of price metric or index on all parts of the market. We have to look to the comps!!

Thanks for being here. I hope this was helpful.

Questions: What price metrics are you looking at these days? Have you noticed the problem I mentioned with metrics bouncing around?

If you liked this post, subscribe by email (or RSS). Thanks for being here.

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