6November2008

A Ray of Hope for the Real Estate Market

Posted by staceysloan under: Housing and Economy; Buying a Home; Housing Recovery; Selling a Home.

I have said it before, and I will say it again, real estate always, eventually, appreciates.  History has shown us, particularly in Southern California, that prices will always rebound.  That doesn’t mean that buying a home isn’t a serious decision in uncertain economic times.  But these prices may never come around again, because most economists are calling this a “once in a century” economic travesty.  UCLA EXPERTS PREDICT A RECOVERY IN THE HOUSING MARKET WILL SPUR THE ECONOMY. (OC Register, 10/28/

The article predicts the bottom will hit in summer 2009.  They expect a fall of 9% in 2009 and then to rise just 3.5% to 6% over the next 4 years after that.  They predict a median rise to $523,563 in 2013.  The thing about real estate, unlike other investments, is that it doesn’t go anywhere.  That house, or apartment building, or land, is a fixed object, a part of the earth.  As Will Rogers once said, “Buy land, God’s not making any more of it.”  However, this is a somber time in our history.  Decisions are not easy to make.  If you have questions on anything from loan modifications, to short sales options, or having home equity and needing to sell in this tumultuous time, I am here to serve you.  Please call my office for any questions or concerns regarding your situation.

14September2008

Sales Slump Ends After 33 Months

Posted by staceysloan under: Housing and Economy; Housing Recovery; Life in Orange County; Selling a Home.

It was hard to miss this August 19th headline in the Orange County Register.  In fact, it was an end to the longest home buying slump on record.  Never mind that the slump ending is directly attributable to still increasing foreclosures, and a still decreasing median home price.  After all, the buyers had to live through the first half of the decade, so sellers will have to live through the second half of the decade.  The real estate market is usually comprised of 3 types of markets; seller, buyer, and neutral.  So what exactly has been happening to generate the positive press?  First of all and possibly most important is affordability has made a comeback.  At the end of the selling frenzy and sub-prime debacle, affordability was a scant 11%.  No housing market will remain healthy when only 11 out of 100 people can afford to buy a home.  We have now risen back above 50%.  Secondly, there are screaming deals out there and even though there are a lot of them, there are not as many as there were.  In other words, according to the Orange County Register (August 26^th 2008), Orange County home demand is up 103% versus a year ago.  A report by Steve Thomas shows that, “fresh pending sales from the past month rose 51% in two weeks to 2,991.  One year ago, demand was 1,475.”  But the really interesting part is that supply is at its lowest level in 16 months. (OC Register).

The Associated Press ran a similar headline, “Sales of Existing Homes in U.S. rose in July, Realtors Group Says.”  In fact, sales increasing are a national phenomenon of the moment.   At the end of August, according to Jonathan Lansner’ column, who was quoting Steve Thomas’ Market Update, supply, or active listing inventory in SoCalMLS, fell 289 homes in two weeks to 14,059, the lowest level since April 5^th, 2007.  Even though another wave of foreclosed properties is definitely on the way, for the first time in months the number of distressed properties to hit the market fell in July.  Finally, First American CoreLogic reported that prices are not falling as fast as they once were. (Lansner: OC Register)  This may suggest that although prices are likely to continue to drop into 2009, it probably won’t be nearly as fast, as prices are leveling off. 

15May2008

Prices Are Down, But Sales Are Up

Posted by staceysloan under: Housing and Economy; Buying a Home; Housing Recovery; Selling a Home.

The next paragraph will have the exact numbers of sales which will still be down from the previous year, but up from the previous month.  The fact is sales are way up from February.  March sales (the latest month available) in Los Angeles, Orange, Ventura, San Bernardino, Riverside and San Diego counties were up 19.8% from February.  According once again to Dataquick, that’s still not great as the average increase from February to March for the previous 20 years has been 38%.  Yet I think it’s a number worth looking at.  Why?  Because most brokers reported their highest monthly sales in 15 months, which means this March was a heck of a lot better than March of ’07.  The current inventory levels have not only stabilized, but they have hit a neutral plateau meaning they don’t really favor sellers or buyers.  According to the OC Register (April) supply is hovering at about 6.77 months, meaning if not another house was listed it would take 6.77 months to sell every home currently listed to reach 0% inventory.  This is not a bad number considering the affordability index is rising monthly.  In fact, it’s risen from a low of 11% at the height of the market to around 30%.  That’s the number of people that can afford to buy a home at current prices.  Even though the emotions of the market favor buyers and because of that supply favors buyers, activity is slowly growing.  Are we out of the woods?  No, let’s be realistic and truthful.  But, investors are sneaking back in and there are some great deals out there.  If you need to buy, you need to call me.  There are not a lot of great reasons to wait because the single factor that should sway you is interest rates and they are still at near historic lows.