Sacramento Appraisal Blog

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The Housing Market’s Uno Reverse Card

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The housing market is starting to feel like the opposite of last year. It’s like an Uno Reverse Card was played, and there’s a different feel in the housing game. Let’s talk about the dynamic and think through what we might see this fall. I also have some thoughts about new research about the age of first-time buyers.


Photo by DSXST on Unsplash

BACK TO THE ’80s

I don’t know how it happened, but so many people on social media are posting AI visuals this week of what they would have looked like in the ’80s. Being that I just wrote about the ’80s, I wanted to share an actual photo of me. Here’s yours truly in 1987. Skater haircut. Check. Alva t-shirt. Check.

THE OPPOSITE OF LAST YEAR

It was a stronger spring in 2026 compared to the prior year, but it’s looking like a softer fall is upon us now since rates are closer to 7% today. In contrast, 2025 had a dull spring with a fall that tightened since mortgage rates were going down at the time. It’s still to be determined how the fall market unfolds ahead, but for now we’re recognizing rates seem to be heading up instead of going down, and that should theoretically take some heat out of the market unless sellers really back off. All that said, this isn’t a painfully dull market in the stats, so maybe an Uno Reverse Card analogy doesn’t work perfectly since it’s not like the market had a really sharp direction change. Ultimately, we have noticed less growth in closed sales, slightly lower pending growth, and price reductions are slightly above one year ago now. That’s why I’m saying the market today has been growing softer instead of tightening like it did last year. In other words, opposite vibes.

WILL THE MARKET WEAR SKINNY JEANS OR MOM JEANS?

The housing market got pretty dull last year in the spring, but then it tightened as rates dropped in the fall. In other words, it went from mom jeans (loose) to skinny jeans (tight). Check out the blue line (2025) and how it really departed from the pre-2020 norm (red) before squeezing closer together before the year was up. Well, 2026 has been in the middle lately, and I’m eager to see how the rest of the year unfolds if rates persist to be higher. All I’m saying is let’s be realistic about the possibility of a slower fall season since we’re seeing the opposite of last year. Instead of tightening due to lower rates, it’s been loosening lately. So, mom jeans instead of skinny jeans is the vibe. No matter what, it’s important to remember that the good stuff goes quickly today while other homes will just sit. Buyers are hyper-sensitive about price, condition, and location, but they’re ready to act quickly when the right home hits the market. 

THREE STEPS FORWARD AND TWO STEPS BACK

Sometimes the market feels like it takes three steps forward and then two steps back. This year, closed sales volume in Sacramento was up 5% through July, but then August sales were very flat (I’ll have August stats in full next week). This is a good reminder that progress isn’t linear. What I mean is, don’t expect growth every single month or quarter. Sometimes the market will move forward and other times it will contract. I find it’s really uneven with real estate friends in their personal business too. Some friends have been doing great, but many are struggling. It’s not one thing for everyone at the same time, and that’s exactly why we have to remain connected to a bigger stat source to understand the market. My advice? Keep moving forward. Have a plan. Stick to the plan. And focus on building relationships with people.

LET’S TALK ABOUT AGE GAPS

Age gaps are in the news again, but this isn’t about billionaire Boomer grandpas dating Gen Z. Let’s talk housing age gaps.  

FIRST-TIME BUYERS ARE YOUNGER THAN FORTY

It’s been widely reported that first-time buyers are now forty years old based on a national survey from NAR. Yet, all other data sources I’ve seen show first-time buyers are somewhere between 32 and 35. This is exactly what AEI reiterated this week in saying first-time buyers were 33 years old during the second quarter of 2026 (median age). Thanks Steve Kroes for the heads-up with this data. 

NO WAY BRO, THEY ARE 40

It’s pretty much commonly believed online that first-time buyers are forty years old now, and this stat is often used to perpetuate despair. I would bet money my own Gen Z college kids have heard this stat. Friends, we have a very serious housing affordability problem, and there is no sugarcoating it. Let’s just get the numbers right. I’m not anti-NAR either. I am concerned about credibility though since the NAR survey is 120 questions and only had 6,103 responses nationally. What age group fills out a 120-question survey? 

WHEN NARRATIVES SHOW UP IN THE LOCAL MARKET

Check out a local example that is based on the NAR survey. This is exactly what I’m talking about. The idea of Boomers being the largest group in the housing market stems from the NAR survey. It’s wild how this survey has been so viral across the country, and it’s really become somewhat of a pillar in so many housing conversations. 

NAR IS RIGHT ABOUT THE TREND THOUGH

I think NAR is correct about the trend with buyers getting older through the years. I spoke at a builder meeting today, and someone in the crowd echoed that’s what she’s seeing too. Buyers are older. Bottom line. Yet, I can’t get behind the NAR age since other data sources tell a different story. 

ISN’T IT IRONIC?

Ironically, in the midst of all the headlines about first-time buyers being missing in action, we’ve seen the most growth in sales volume this year in the Sacramento region between $400,000 to $500,000 – a prime first-time buyer price point. As you may notice, most price ranges have grown this year too. By the way, I’m not saying these are all first-time buyers either (not an easy way to figure that out). 

Anyway, thanks for being here. I appreciate it. I don’t plan to mention the NAR survey again soon either unless some new research comes out. Check out my socials for lots of stats in coming days. 

Question: What do you think the fall housing market is going to be like? What age are you seeing for first-time buyers in the marketplace? 

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The housing market smells like the early ’80s

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I love ’80s music, but I don’t have much love for the housing market in the early ’80s. The trend was actually strikingly similar to today, and I have an article from The Sacramento Bee to prove it. On that note, let’s pause and soak up some perspective and wisdom from the past. I hope you dig this. 

UPCOMING SPEAKING GIGS:

9/9/26 Private market update with local builder
9/15/26 Culbertson & Gray
9/22/26 Downtown Regional MLS Meeting Q&A
9/24/26 Appraiser webinar TBA
10/2/26 PCAR Rocklin
10/21/26 Coldwell Banker Sierra Oaks / EDH
11/17/26 Orangevale MLS Meeting
11/19/26 Appraiser webinar TBA

YOU’RE NOT THE ONLY PERSON TO EVER STRUGGLE

It’s comforting knowing others in the past have also endured challenging real estate markets. It’s a reminder that people can make it. Like my broker friend, Nick Brooks, says, “The good markets don’t last. And neither do the bad ones.” The truth is history tends to rhyme, so it’s important to stay focused and employ survival tactics. 

SIMILAR VIBES IN THE EARLY 1980S

Mortgage rates were spiking in the early ’80s, buyers backed off, and it was a challenging time to stay afloat in the real estate business. 

THE STORY OF REA HOOK, LOCAL REAL ESTATE AGENT

Today, I’d like to introduce you to a woman named Rea Hook, a local real estate agent in the ’70s and ’80s. Thank you to the Sacramento Bee for allowing me to share this article from November 1980. 

THIS BUSINESS HAS CHANGED

Check out what real estate agent, Rea Hook, had to say about the housing market in 1980. Rates spiked from 8.5% in the late 1970s to 14.3% by the end of 1980, and that had a dramatic effect on the housing market. Sounds like today, right? 

EVERYTHING CAME EASY A FEW YEARS AGO

Everything was coming easy in the real estate business in the earlier 1970s. It sounds funny that making $20,000 to $30,000 in a year was a flex, but that was around $135,000 to $200,000 in today’s dollars if you adjust for inflation. This reminds me of 2021. It was easy to make good money in real estate because there was so much business happening. I also appreciate what this agent (Rea Hook) said about not worrying about dollars. While it’s a simplistic view of things, I think there is real truth there. When we put our hand to the plow to work hard and keep it about people, things do tend to eventually work out. 

A MARKET OF SURVIVAL TACTICS

Tough markets create tough professionals. Or maybe we could say tough markets reveal tough professionals. I love how Rea Hook says, “It forces you to put in extra hours and effort and learn survival tactics.” This is true. Many people talk about thriving in today’s market, and while that’s possible, I think the first goal is to survive.

PROFESSIONALS CAN THRIVE IN A TOUGH MARKET

Everyone talks about being professional, but a tough real estate market is the proving ground. The “old days” are over. It’s time to stay focused and move forward every single day. It was a market for professionals in 1980, and I think the same thing is true in 2026. 

And closing thoughts on professionalism.

I SHARED THIS STORY AT A CONFERENCE

I gave a talk this week called, “Be Yourself” at the ROG Talks conference in Midtown, and I shared about the importance of focusing on relationships in real estate. In my closing, I mentioned this story about Rea Hook, and I think it resonated. Here’s a picture of me from Michelle Clark.

Anyway, I hope this was interesting and encouraging. I think there’s something powerful about history, and I hope you feel inspired. On a different note, part of me hopes Rea’s family will find this post to know that her words from long ago are still very much alive. I read her obituary, and she sounded like an amazing person. Much love, Ryan. 

Thanks for being here. 

Question: What do you think of the quotes? Do you love ’80s music too? 

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Baking chocolate chip cookies for Gavin Newsom’s open house

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I’ve offered to bake cookies for an open house for Governor Gavin Newsom’s home that just hit the market, but I’m guessing the listing agents aren’t going to take me up on it. Haha. Yes, I did jokingly text one of the agents an offer to put my baking skills to the test. Anyway, let’s talk about this listing and some of the interesting things people are saying about it. 

UPCOMING SPEAKING GIGS:

9/1/26 ROG Talks
9/9/26 Private market update with local builder
9/15/26 Culbertson & Gray
9/22/26 Downtown Regional MLS Meeting Q&A
9/24/26 Appraiser webinar TBA
10/2/26 PCAR Rocklin
10/21/26 Coldwell Banker Sierra Oaks / EDH
11/19/26 Appraiser webinar TBA

THE GOVERNOR LISTED HIS HOME FOR SALE

The Sacramento area home owned by Governor Newsom and his wife hit the market two days ago at $7.5M, and it’s gone viral. This is the highest-priced single-family listing in Sacramento County right now besides a property with 548 acres. There are other higher listings in adjoining counties, of course. The Governor and his wife purchased this home in 2018 for $3.7M. Listed by Matthew Hindy and Nick Sadek. 

Photo from MLS listing: Matthew Hindy / Nick Sadek listing agents

NO OPEN HOUSE COOKIES

I would bake for the open house, but there won’t actually be an open house. Proof of funds and/or pre-approval is required for all showings, so very few people will see this home in person. 

I GAVE THOUGHTS TO THE NEW YORK TIMES & LOCAL MEDIA

I gave some quotes about this property to the New York Times, Sacramento Bee, and CBS 13. If anyone has questions, reach out. I’m always happy to give a take and share stats. 

Here’s an Instagram reel I put together about this post too. 

IT WAS BRILLIANT TO LAUNCH ON A MONDAY

Monday is a sleepy day for new listings to hit the market. In fact, most new listings go live on Thursday and Friday as buyers get prepared for the weekend, but the Newsom property launched on a Monday instead. I thought this was actually brilliant for such a high-profile listing because it gives an entire week of viral media exposure across the country. This is a good reminder there isn’t a one-size-fits-all marketing approach that will apply to every home. 

GAVIN NEWSOM LOVES OUTLIER HOMES

When looking at Newsom’s two most recent home purchases, they were both outliers in their respective areas. This visual shows the Fair Oaks property at $3.7M in 2018, and it just doesn’t compare well to many homes because of its massive square footage and lot size (over twelve thousand square feet with eight acres of land). 

The Newsom family purchased a Bay Area home in Kentfield in 2024 for $9.1 million, and it was also one of the highest sales in the market. Technically, the family “downsized” from Fair Oaks since this Marin county home only has less than 6,000 sq ft and one acre. 

FREQUENTLY ASKED QUESTIONS

Could this really sell at twice what Newsom paid in 2018? 

The market as a whole hasn’t doubled, but keep in mind a couple things. The luxury market has grown more than other parts of the housing market, so we can’t expect a home like this to rigidly follow the median sales price trend. Moreover, this property is said to have had a significant renovation. We’ll see what happens here. The market gets to decide. The highest sale ever in the region is in Loomis at $8.25M, though there was a home in Davis at $8.39M, but it had 91 acres. There have been three sales on MLS since 2024 that have closed above $7M. 

Will it go quickly? 

There is no way to know. Sometimes a buyer comes along right away, but it usually takes longer for homes at higher prices. The average days on market over the past five years for five million dollars sales is 124 days. The shortest was six days and the longest was 524 days. So, it’s possible to go quickly, but usually that’s not the case. 

Will the viral attention help sell the property? 

Yes, I think so. But price matters more than eyeballs on this listing. In my mind, the right price is what sells a home rather than viral media exposure. With that said, if there is a unicorn buyer out there looking for something like this right now, that buyer is going to see this unicorn property. 

Who will buy something like this? 

That’s to be determined, but homes of this caliber have a high probability of being cash purchases. 73.3% of sales above $5M since 2021 in the Sacramento region have been all cash per MLS data. 

Do homes like this get offers above the list price?

Most of the time properties at the highest prices will sell below their original list price. Part of the issue is sometimes these homes are priced at fantasy levels, so they simply need to come down to reality. This is why the average reduction in the Sacramento region has been just over one million dollars for sales at the highest prices. Yet, 20% of these homes sold at or above their original list price, so not everything goes below. 

Is there any extra value due to a governor owning the home?

My inclination is to think most of the time buyers aren’t paying a price premium because of who previously owned a property. Of course, I can’t say for sure here until the home sells, but at the least, I do think the new owner has some bragging rights to say, “I bought a home from the governor.” Yet, there are special properties that can command a premium. I think of the home in the Fab 40s that Ronald Reagan rented, and even though he didn’t own it, this home feels historical locally.

Quite a few people on my Facebook page said they would never buy a house like this or they couldn’t even be paid to live there. I get it, but social media comments may not represent real buyers, so what anyone thinks besides an actual buyer doesn’t really matter (this includes my opinions too).

HOT ISSUES THAT KEEP COMING UP

The following is not written from a red or blue perspective, and I don’t write to defend the governor. I think some people today idolize politicians, but that’s not me. I saw a great t-shirt last week that said, “Idolizing politicians is like believing the stripper actually likes you.” Haha. 

These issues came up on my social media:

Is the governor moving out of the state?

I can’t speak for him, but I’m guessing no unless he gets elected to a higher office. In 2024, the Newsom family purchased a home in the Bay Area, so maybe it was simply time to let go of the Sacramento County property. I would bet money on Polymarket that Newsom is not moving to Texas though. 

Why doesn’t this home have solar?

I saw quite a few comments that Gavin Newsom‘s property does not have solar. True, it doesn’t. I think some people feel bent out of shape that the governor has been a strong supporter of solar while not having it himself.

Does Gavin Newsom pay his taxes?

A number of people said he probably doesn’t pay his taxes, but things like this can be fact-checked online easily. Property taxes were clearly paid on this home. Check out assessor records if you wish. On a related note, others wonder if he will pay capital gains, but that probably depends on what this home sells for. The Newsom family is said to have paid $500,000 in federal and state taxes in 2024, so at the least we see a pattern of paying some form of taxes. 

Here are property tax records for one of the parcels in Fair Oaks (there are actually two parcels on this site). 

Why doesn’t this home have an electric stove? 

The stove is gas instead of electric, and many pointed that out. The governor has not banned gas stoves, but he has supported legislation to increase the use of electric stoves in new construction. 

Why does he not have 100 feet of defensible space?

When looking at Newsom’s home, there are trees all over the place, and many people have wondered why he doesn’t have at least one hundred feet of defensible space (or even five feet). Look, I’m not an insurance expert, but not every parcel in California needs this much space, and rules about defensible space depend on whether an area is in a high fire risk zone or not. Friends, I’m not writing as a gubernatorial fanboy here, but when looking throughout the neighborhood, the governor is clearly not getting special treatment here. We see trees like on the street and throughout Fair Oaks. I realize a larger defensible space is a major issue in other areas, but that’s not the case on this street. 

Photo from MLS listing: Matthew Hindy / Nick Sadek listing agents

APPROVING COMMENTS

I think it’s fascinating to talk about properties like this, and I welcome conversation. I will not approve comments that are only political in nature. I don’t mind if things get a little spicy, but let’s keep it mostly about the real estate.

Thanks for being here. 

Question: What do you think of this property? Anything to add? 

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Excuse me, I’d like to buy your backyard ADU

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Would you be willing to sell an ADU separately from your house? That’s a wild idea, but it’s exactly what a newer California law allows people to do. The first example of a sale like this happened recently in San Jose, so let’s talk about this law and what to do for comps. When laws or markets change, we sometimes have to start thinking about things differently. 

NOTE: I shared new stats last week on the stats tab instead of writing an entire post with twelve counties of data. Also, I’ve talked more about ADUs lately. This is not an ADU blog. Just a coincidence. 

UPCOMING SPEAKING GIGS:

8/25/26 Elk Grove MLS Meeting 8:30am
9/1/26 ROG Talks
9/9/26 Private market update with local builder
9/15/26 Culbertson & Gray
9/22/26 Downtown Regional MLS Meeting Q&A
9/24/26 Appraiser webinar TBA
10/2/26 PCAR Rocklin
10/21/26 Coldwell Banker Sierra Oaks / EDH
11/19/26 Appraiser webinar TBA

THE FIRST CONDO CONVERSION JUST HAPPENED

Two years ago, AB 1033 became law, and this allows owners to sell an ADU separately from the main house. This would not normally be allowed without some sort of a parcel split, but under AB 1033, the entire parcel can be converted to a condo, and that allows the rear ADU condo to be sold separately. Basically, the parcel becomes a two-unit condo development. On one hand, this is innovative thinking to help with affordability, but on the other hand, this type of law is sadly only needed because of a lack of affordability. Anyway, the first reported sale of an ADU condo conversion just happened in June in San Jose, so I wanted to put together some visuals for perspective since I have access to San Jose data.

EXPECT TO SEE THIS MORE IN OTHER CITIES

Keep in mind, AB 1033 is not mandatory, so these types of sales can’t happen everywhere since individual areas have to adopt the law. Only one local city I’m aware of has adopted AB 1033, and that’s West Sacramento (it’s being discussed in Sacramento). Otherwise, there are a handful of cities across the state that have embraced this new law including San Jose, San Diego, Berkeley, Oakland, San Francisco, Santa Monica, and others.

THIS UNIT SOLD TOWARD THE LOWER END OF THE MARKET

What are you going to do for comps if this law happens in your area? That’s one reason why we want to start watching examples like this. The 749 sq ft ADU conversion in San Jose sold toward the lower end of the competitive range in the ZIP Code at $530,000. Look, it’s hard to buy anything at this price point in the area. Remember, this is the city where a meth house was listed for sale at $1.5M a couple years ago (it sold at $1.36M). There are zero single family detached units selling around $530K, and there are only a few recent condo sales that low. Keep in mind, this former ADU was built in 2024, so it’s on the newer side of the age spectrum. From public records and MLS, it looks like it was financed with conventional financing, which means an appraiser had to choose condo comps from somewhere most likely (unless there was an appraisal waiver). 

All condos in bright pink compared to 600-900 SQ FT in yellow.

And here’s a look at all single family detached sales of similar size compared to the ADU condo conversion. The closest sale of similar size was about $700,000. Granted, the ADU conversion isn’t really a single family detached home, so this is not a reasonable comparison. I just wanted to show context as it looks like AB 1033 is going to help some people get into the housing market at a lower cost. 

QUESTIONS FOR THE FUTURE

1) What comps do we use for an ADU conversion?

What condo comps can we use for an ADU conversion if there aren’t any ADU conversion condos yet in the local area? In this example above, the ADU conversion sold toward the lower end of the competitive range, and that’s something we can keep in mind, but it’s also just one data point. What we want to do over time is look at various examples. Granted, if they all tend to sell toward the lower end of the range, that would be telling. For now, I think these types of valuations are going to be challenging for appraisers and the real estate community because there might not be any great comps for a while. At the least, it’ll be helpful to pull some examples in other parts of the state to study. Let’s ask questions though. What is the entry level price point for the neighborhood? What are other condos selling for? What are other detached homes of similar size selling for? And from an investment standpoint, is the sum of the parts greater than the whole here? In other words, will investors be able to split and make more money by selling each unit separately? 

Remember, the ADU is now a condo, so we’re going to compare it to other condos. It’s a tough comparison because it’s not really the same thing as a traditional condo found in a gated complex. 

2) What happens to the value of the main dwelling?

Is the value of the main dwelling going to be affected by the condo conversion? We’re going to need some data at some point to understand any impact. Keep in mind, the main house is now also considered a condo since everything on the parcel has been converted to a condo. It’s not just the ADU being converted. Will the need for condo financing or a condo form of ownership affect buyer demand and value? We don’t have these answers yet, but I have to think the pool of buyers is now smaller for a main home (I could be wrong). Previously, the main house on the front of the lot above sold for $900,000 in November 2020 without the ADU. After the ADU was built in 2024, the owner tried to sell the house and ADU for $1,390,000 in early 2025, but the listing expired. 

UPDATE: Monica in the comments told me the main unit is currently listed for sale, and that’s true. Listed at $868,000 (listed as a condo on MLS too).

3) How many owners will make this conversion? 

Converting the entire parcel to a condo comes with some challenges because now the main house has a little less privacy potentially, and it also needs to be compared to other condos as the ideal. I suspect this new law is only going to apply to a handful of situations. 

4) What other counties and cities will adopt AB 1033?

AB 1033 is state law in California, but it has to be adopted by various counties or cities, so it is not mandatory. I do think we’re going to see more cities adopt this, so real estate professionals need to stay on their toes. I suspect there is going to be an appetite for buying something like this also as it gets someone into a traditional neighborhood at a condo price point (without a huge HOA fee probably too). Remember, just because it is law doesn’t mean it’s going to happen on every parcel. I think many owners would not be comfortable with the condo conversion in the first place, so I don’t expect to see this everywhere. 

CLOSING THOUGHTS

This is an example of policy shaping the housing market. We often talk about supply and demand as being the main thing in real estate, but it’s really policy that shapes both supply and demand. In this case, on the buyer side, I like the idea of buying an ADU conversion in a neighborhood instead of a bigger condo community, but I think there are concerns for the owner when converting the entire parcel to a condo in terms of future marketability or privacy. This won’t work for everyone, but it will work for some. 

Thanks for being here. 

Question: Would you buy a condo conversion like this? Would you convert your parcel into a condo? I’d love to hear your take. 

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