Monday, December 26, 2011

Oz is in denial

Just got back from my vacation to NZ and OZ, and of course I couldn't help but check out the prices of real estate over there. In fact during many of the tours the guides would continually point out how "well" there market was doing. It was incredible, it was like being here in 2006. Nearly all the people I spoke with, if the topic of home prices came up just seemed to say all the stuff we heard 5 years ago. "it's different here", "price might level off, but I doubt they will fall" etc. NZ was by far the worst. The prices of everything over there is unbelievable. I dunno how they live. But the prices of housing was off the charts as compared to incomes.
Median incomes are comparable to the US, yet the cost of nearly everything was higher. Australia was not nearly as bad as NZ in that respect but in the two cities we visited things were quite a bit higher than here. Of course the cost of living in most large cities is higher than living in the burbs but I was not able to really check the costs out in the burbs. We did manage to get out into the burbs in Melbourne and the tour guide would point out housing tracts give us approximate costs. If those were correct they their prices are comparable to ours at the peak of our bubble. We saw shacks in the city that he indicated were well north of a million (and I do mean shacks!), in the burbs we saw small average looking tract homes that were $500k to $800k.

NZ and OZ are beautiful places and well worth a visit. But save your pennies cuz int aint a cheap vacation. Oh, and driving on the opposite side of the road is interesting too!

Thursday, December 8, 2011

Happy Holidays

Happy Holiday's ya'll

I'm taking the rest of the year off and heading to New Zealand and Australia.

Friday, December 2, 2011

Ah the good old days

While looking at Zillow I ran across this. I found it rather humorous and reminder of the heady days of bubble mania. This guys puts a "make me move" price into Zillow in 2007 of $1.4M for a house that now has a zestimate of $505k. And lemme tell ya, there's no way this place would sell for $505k, that's probably at least $50k too high considering there is not a lick of landscaping. I was actually looking at 18825 Ravenhurst which is listed at $1.2M and has a zestimate of nearly $900k. Which I thought was WAY high. It's a spectacular place on 2 acres but there's no way it will get 1.2M and I seriously doubt it would even get Zillows $900k estimate. Based on comps this place is worth closer to $750k.

Ah, the good-ole days. I bet this guy is wishing someone had taken him up on his "make me move" price.

Tuesday, November 22, 2011

Scam Alert!

Check out this BS

16475 Lake Knoll Pkwy lists as a short sale, it says poor condition but in the pic it looks ok. It lists cheap and goes pending pretty much immediately. It sells pretty cheap and the listing agent and buyers agent and the same guy (who'da thunk it). Now this is where it gets shady. 30 days later, it lists again for $160k more than it sold for, and the agent........ You guessed it, the same guy. But it gets better, the listing states the owner/seller is a realtard! Anyone wanna bet the owner is the listing agent? This looks like a perfect example of short sale fraud. He lists the property indicating it's a dog, gets it cheap and then turns if for a quick profit. And of course the lender takes a bigger loss than they otherwise would have. His asking price is pretty darn high and I doubt that it will sell for anything near that but even if it sells for $350k that's still a very healthy profit assuming he didn't actually need to do a major rehab.

Wednesday, November 16, 2011

Octobers numbers

Here's the October report from DataQuick. Not a lot of movement in the IE. San Berdu is stuck at $150k median and Riverside fell a little. Sale numbers were down slightly from last year which is a little surprising considering how low interest rates have been. I suppose some of that slowdown could be the lack of inventory at the low end. If you've been looking you know there aint' much decent in the starter home/rental end of the market. From what I am seeing the more expensive stuff is just sitting unless the house is spectacular.

Here's the meat of the report.

Southland home sales rose slightly in October compared with a year earlier but were still nearly 30 percent below the long-term average. The region’s median sale price dipped to its lowest level since January as activity above $500,000 fell sharply, distressed property sales rose slightly and mortgage availability worsened, a real estate information service reported.

A total of 16,829 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in October. That was down 7.3 percent from 18,149 in September and up 0.5 percent from 16,744 in October 2010, according to San Diego-based DataQuick.

A drop in sales between September and October is not unusual, but last month’s decline was larger than the average change – a decline of 0.7 percent – between those months since 1988, when DataQuick's statistics begin.

October sales have varied from a low of 12,913 in 2007 to a high of 37,642 in 2003. Last month’s sales were 29.3 percent below the October average of 23,819 transactions since 1988

“For a few months now, lower prices and amazingly low mortgage rates have kept resale activity slightly ahead of last year. Of course, that’s not saying a lot when you consider sales were 25 to 30 percent below average. The market continues to struggle with a difficult lending environment, uncertainty among potential buyers, underwater homeowners who can’t move up, and a weak job market. The lower conforming loan limits implemented last month help explain the relatively sharp drop in mid- to high-end sales during October. Now we’ll have to see if the private loan market can fill the void,” said John Walsh, DataQuick president.

The conforming loan limits, which were reduced Oct. 1, vary by county. In Los Angeles and Orange counties, for example, the limit for FHA loans and mortgages guaranteed by Fannie Mae and Freddie Mac was lowered from $729,750 to $625,500. Home sales in those two counties that had purchase loans between $625,501 and $729,750 – the band eliminated by the lower limit – dropped to 102, down 71 percent from 350 sales in September and down 71.5 percent from 358 sales a year earlier.

The typical monthly mortgage payment that Southland buyers committed themselves to paying was $1,040 last month, down from $1,084 in September and $1,111 in October 2010. Adjusted for inflation, current payments are 55.4 percent below typical payments in the spring of 1989, the peak of the prior real estate cycle. They are 63.4 percent below the current cycle’s peak in July 2007.

Sales Volume Median Price
All homes Oct-10 Oct-11 %Chng Oct-10 Oct-11 %Chng
Los Angeles 5,470 5,830 6.60% $325,000 $300,000 -7.70%
Orange 2,298 2,241 -2.50% $438,000 $405,000 -7.50%
Riverside 3,264 3,026 -7.30% $198,000 $187,000 -5.60%
San Bernardino 2,343 2,300 -1.80% $150,000 $150,000 0.00%
San Diego 2,750 2,759 0.30% $334,500 $315,000 -5.80%
Ventura 619 673 8.70% $355,000 $335,000 -5.60%
SoCal 16,744 16,829 0.50% $283,000 $270,000 -4.60%

Saturday, November 12, 2011

Nandina back on the market

A couple of years back I wrote about a small development that went belly up after building most of the homes. They came on the market in Late 2007 right when it was coming apart at the seams. They were trying to get right around a million for these homes back then. I laughed out loud at the sales lady when I saw the price sheet. They stuck it out for about a year after finding only one sucker to buy a house. The whole tract went into foreclosure and sat empty for a few years. Well recently they have started selling again. The prices now are about 1/2 the original price. Not a bargain but these are pretty nice homes with high end kitchens and lots of nice built-ins. I really liked the floor plan on a couple of the models. The good thing about this little tract is there is no Mello Roos nor any HOA to deal with. On the bad side you are paying top dollar since it's a new home and you still have to spend a healthy chunk of cash putting in some landscaping and fencing.

Here is one of the homes they have listed.

Tuesday, November 1, 2011

Geez, where have I been?

With the market basically flat for the last two years there's just not that much to write about. Sure there are a few stupid listings out there and there is still a fair share of fraud and funny biz going on (inside deals selling for way less than they should etc) but it's a lot harder to find and I just don't have the energy to search through every listing to find that stuff. And as you may have guessed I did finally buy a place early last year. I didn't get a "smokin" deal in fact I probably overpaid slightly based on comps but we wanted the house and were willing to pay a little more than we wanted to get it.

Since I did actually purchase a house in this market I will offer my insights into the buying process. First off the market it TOTALLY rigged right now. Good deals are all inside deals where the realtor already has a buyer, a friend or investor they are working with. You and me have no chance of getting one of those. Trust me I tried! If you are thinking you are gonna lowball, forget it.

You need to do your research and offer a fair price based on current comps. It's not hard to find comps and if you have been looking you can check and see what the homes you have looked at are closing for. This will give you a good feel for the actual market value of properties.

If you are using a buyers agent you are at a disadvantage in this market. For total noobies it might make you feel better to use your own buyers agent but the reality is you have a MUCH better chance of getting your offer accepted if you go it on your own and just go directly through the selling agent. The prospect of collecting both ends of the commission seems to really "help" out your offer! (surprise, surprise).

I submitted approximately a dozen offers. 5 of those were submitted by a realtor for me and NONE were accepted even though they were fair offers. That's when I decided to go right to the selling agent myself. My first offer was $70k under list price (which was way high based on comps). I really though we had that one but the seller took another offer and we were the first back up. The home was a short sale and took 9 months to close. It closed for exactly what we offered. I spoke with the listing agent and the reason they went with the other offer was that they thought we did not have enough cash reserves. Offers 2 and 3 were accepted but we backed out after inspection problems. We then offered on a new home in the Stellan ridge developement. The home was listed at nearly $600k, we offered $550k but the builder would not go lower than $570k. Than home sat for another 4 or 5 months before finally selling for ..... $550k! I'm SO glad I did not buy that property. Our next offer on a short sale was accepted and we went under contract to purchase. The bank screwed this one up and ended up foreclosing on the home. We could have bought it at the trustee sale for $50k less than our short sale offer. When it hit the market as an REO 6 months later we put in another offer with the listing agent and moved in 30 days later. And yes, we still paid $50k more than we could have got it at the trustee sale.

So as you can see nearly every offer we made going through the selling agent was accepted. All the offers we made with a buyers agent were ignored or rejected. You do need to be comfortable enough to do this but you can always pay someone to look over your documents.

Our deal was pretty smooth but the appraisal was still a joke. The comps the guy used were ridiculous and the appraisal came in probably $30k higher than it should have in my opinion. I was hoping for a lower appraisal so I could negotiate the price down a little but that didn't happen. The appraisal came in $1k over our offer price (hmm quite the coincidence eh?) So did I over pay? Maybe a little but after we purchased 2 more identical model homes sold for prices very close to ours so it seems our number was actually pretty good.

What's our place like? We got nearly everything we wanted in our home. It's just under 4000 s/f and it's a single story home in Woodcrest, (like we wanted). It sits on just over an acre of land. It does have the dual 2-car garages that I wanted so bad. The wife and kids got the pool they wanted and it has a gorgeous view overlooking Riverside. It did not have everything we wanted. It has carpet and tile, we really wanted hardwood flooring. The kitchen cabinets are lighter than we really wanted and the appliances were not the high end stuff we were after. But those things can be changed. The location and the view cannot. Being an REO it did need painted and a few minor repairs but overall the home was in great shape (probably a cash for keys deal).

Overall for us the buying experience was not too bad. Of course we did have to wait a few years for the market to correct. And to be honest we could have probably bought at least a year or more earlier than we did. We started making offers in late 09 but could have started in late 08 and probably got about the same price (better selection back then too). We also lost a few months using an agent. Once I realized that going through the selling agent was the way to go our offers seemed to get "top billing". Agents are scrambling to make a buck and the easiest way to pad that pay check is to work both ends of the deal. Which is why offers submitted directly to the selling agent look so much better to them. We had a few hiccups but once we were in escrow everything went fairly well.

Unlike many areas I really do feel the IE is at the bottom or so close to it that it's a good time to buy. Especially with the interest rates right now. You actually can buy a home for less than the cost of renting a similar place. BUT, you better be ready to stay because I think that prices are gonna be flat for quite a few years. So if you need to sell after only a few years, the selling costs make it likely that you will lose money. So buy, but buy for the long term.

Tuesday, July 19, 2011

New conforming Loan Limits

What will the new Conforming Loan Limits that go into affect do to the IE market? Many are predicting another wave of price declines when the lower limits go into affect. The current loan limit is $500k. However once you get over $417k getting a loan is a lot harder and usually requires a better credit score, DTI and a higher down payment (15% at least). So for much of the buyers $417k is still the loan limit. The new conforming limit will drop to $335,350. Which is still far higher than what most homes in the IE cost. In effect, the loan limit reduction will only affect those homes priced over that amount (or a little higher based on the down payment). That is only 12% of the home sales in the IE, the other 88% are not going to be affected. So, if you are looking at homes over $350k you might want to relax a few months, there is a good chance that segment of the market might see some price drops. But if you are looking in the under $350k range I doubt there will be much change. Of course this is assuming the government doesn't pull some rabbit out of a hat and extend the limits.....

Tuesday, July 12, 2011

June numbers from DataQuick

The sales report for June is out and it's not a very good one (no surprise there). The IE did ok compared to most of the other areas. Riverside saw it's median tick up again versus May, but san berdu saw it fall slightly. Our sales numbers also went up slightly over May but fell drastically versus last June.

Here's the reports,

A total of 20,532 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in June. That was up 11.6 percent from 18,394 in May but down 14.0 percent from 23,871 in June 2010, according to San Diego-based DataQuick.

On average, sales between May and June have risen 6.2 percent since 1988, when DataQuick's statistics begin. June sales have varied from a low of 18,032 in 2008 to a high of 40,156 in 2005. Last month’s sales count was 26.1 percent below the June average of 27,772. Among all months, June has had the highest number of sales most often – in eight of the past 23 years.

In June last year, which logged the most transactions in 2010, sales were bolstered by state and federal efforts to stimulate the housing market via homebuyer tax credits. Those credits had expired or been largely depleted by July 2010, when sales plunged about 21 percent from both the month before and a year earlier. Southland sales have fallen short of the year-ago level every month since then.

“The housing market remains dysfunctional and lopsided, just somewhat less so than it was a few months or a year ago. The market mix indicates that a lot of potential buyers are either stuck, for lack of equity, or spooked and are waiting things out. Another large, lingering problem is the fussy mortgage market. Qualifying for a mortgage remains difficult for many, and the use of adjustable-rate and “jumbo” home purchase loans remains far below the historical norm,” said John Walsh, DataQuick president.

The median price paid for all new and resale Southland houses and condos purchased last month was $285,000. That was up 1.8 percent from $280,000 in May and the highest since $290,000 last December, but still down 5.0 percent from $300,000 in June 2010.

The median has declined year-over-year for the past four months. It has been unchanged or lower than a year earlier each month since last December, when it posted a 0.3 percent annual increase.

On a year-over-year basis, home sales fell across virtually all price categories last month. But declines were greatest in the $300,000 to $800,000 range, which saw sales drop 25.5 percent from June 2010. Activity in that price band benefitted a year ago from homebuyer tax credits that spurred more move-up activity. Last month’s sales of homes priced below $200,000 fell 11.4 percent from a year earlier, while $800,000-plus sales dropped 17.6 percent.

Distressed property sales accounted for just over half of the Southland resale market last month. Roughly one out of three homes resold was a foreclosure, while almost one in five was a “short sale.”

Foreclosure resales – properties foreclosed on in the prior 12 months – made up 33.0 percent of the Southland resale market in June, down from 33.2 percent in May but up from 32.8 percent a year earlier. Foreclosure resales peaked at 56.7 percent in February 2009.

Short sales, where the sale price fell short of what was owed on the property, made up an estimated 17.7 percent of Southland resales last month. That was the same as in May but down from 20.5 percent a year ago. Two years ago the estimate was 13.5 percent.

The typical monthly mortgage payment that Southland buyers committed themselves to paying was $1,169 last month, up 1.3 percent from $1,154 in May but down 5.9 percent from $1,251 in June 2010. Adjusted for inflation, current payments are 49.5 percent below typical payments in the spring of 1989, the peak of the prior real estate cycle. They are 58.7 percent below the current cycle’s peak in July 2007.

Sales Volume Median Price
All homes Jun-10 Jun-11 %Chng Jun-10 Jun-11 %Chng
Los Angeles 7,849 6,809 -13.30% $335,000 $318,000 -5.10%
Orange 3,423 2,947 -13.90% $445,000 $445,000 0.00%
Riverside 4,645 3,960 -14.70% $210,000 $200,000 -4.80%
San Bernardino 3,179 2,598 -18.30% $160,000 $148,000 -7.50%
San Diego 3,885 3,444 -11.40% $335,500 $330,000 -1.60%
Ventura 890 774 -13.00% $384,000 $355,000 -7.60%
SoCal 23,871 20,532 -14.00% $300,000 $285,000 -5.00%

Monday, June 13, 2011

May results from DataQuick

Sales are down 15% to 20% across SoCal, Prices are pretty well down across the region also. No big surprises here. The IE is doing better but only because we have already fallen farther than the coastal counties. The median in Riverside actually went up $7k from last month. But I suspect that the number from last month was an error or a statistical anomaly.

Southern California home sales held at a three-year low last month amid a sluggish move-up market and record-low sales of newly built homes. The median sale price fell year-over-year by the largest amount in 20 months as buyer uncertainty, tight credit and lackluster hiring continued to restrain housing demand, a real estate information service reported.

A total of 18,394 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in May. That was up insignificantly – 0.3 percent – from 18,344 in April, and down 17.4 percent from 22,270 in May 2010, according to San Diego-based DataQuick. May marked the 11th consecutive month in which sales fell year-over-year.

On average, sales between April and May have increased 5.7 percent since 1988, when DataQuick's statistics begin. May sales have varied from a low of 16,917 in 2008 to a high of 35,557 in 2005. Last month’s sales count was 29.0 percent below the May average of 25,902. May sales were lower than last month in just three of the past 23 years: 2008, 1995 and 1993.

The 1,152 newly built homes that sold across the Southland last month marked the lowest new-home total for the month of May since at least 1988.

“A year ago we were talking about sales reaching a four-year high as buyers rushed to take advantage of expiring federal homebuyer tax credits. Now sales are stuck at a three-year low. The government stimulus is long gone and some of the fundamental drivers of housing demand have yet to strengthen enough to lift sales to even average levels. Some of the key culprits are weak job growth, tight credit and a hesitancy among potential buyers and sellers, who question whether this is the best time to make their move,” said John Walsh, DataQuick president.

“So here we sit in the market doldrums,” he continued. “Two of the more likely sources of fresh wind in the market’s sails would be a pickup in hiring or further home price reductions.”

The median price paid for all new and resale Southland houses and condos purchased last month was $280,000, the same as in April but down 8.2 percent from $305,000 in May 2010. That year-over-year drop was the largest since the median fell 10.9 percent in September 2009. he typical monthly mortgage payment that Southland buyers committed themselves to paying was $1,154 last month, down 2.3 from $1,181 in April and down 10.8 percent from $1,293 in May 2010. Adjusted for inflation, current payments are 50.0 percent below typical payments in the spring of 1989, the peak of the prior real estate cycle. They are 59.0 percent below the current cycle’s peak in July 2007. Indicators of market distress continue to move in different directions. Foreclosure activity remains high by historical standards but is lower than peak levels reached over the last two years. Financing with multiple mortgages is very low, and down payment sizes are stable, DataQuick reported.

Sales Volume Median Price
All homes May-10 May-11 %Chng May-10 May-11 %Chng
Los Angeles 7,320 5,983 -18.30% $345,000 $320,000 -7.20%
Orange 3,257 2,664 -18.20% $450,000 $425,000 -5.60%
Riverside 4,164 3,644 -12.50% $210,000 $197,000 -6.20%
San Bernardino 2,835 2,323 -18.10% $160,000 $150,000 -6.30%
San Diego 3,879 3,087 -20.40% $340,000 $324,500 -4.60%
Ventura 815 693 -15.00% $380,000 $360,500 -5.10%
SoCal 22,270 18,394 -17.40% $305,000 $280,000 -8.20%

Wednesday, June 8, 2011

OMG check out the pics

Here's a "classic" realtard listing. 17551 Dry Run Ct in Woodcrest. This home was purchased for $350k as a shorty in March 2010. I guess the buyer didn't like the country living or maybe it was picked up as a flip (doubtful). But in any case it hit the market last weekend listed for $499k! This guys thinks he can make $150k in a year in this market. I can't tell if this guy put the pool in or if it was in before. The previous listing did not mention a pool. I kinda think he added the pool and is trying to recoup the cost of that AND his other costs.

So what makes this listing "classic"? Well, 10 of the 12 pictures are UPSIDE DOWN! (just like 40% of the homeowners in the IE). Oh and the all caps and spelling errors. In addition the statement that the lot will make a great vineyard or DRIVING RANGE? Really a driving range, have you ever played golf? Most of this lot is pretty unusable. It's basically a gulley with the only flat spot being where the home is.

What are this guys chances? Basically zero at this price. A much nicer, larger home just sold down the street (with a way nicer pool) for $420k. Most of the nicer homes in Bridle Creek are selling for about $125 s/ft. So this guys price should be close to what he paid at $365k. The listing does not quite qualify for the ass clown award but it's pretty damn delusional none the less.

Tuesday, June 7, 2011

Short Sale Fraud

If you have been looking for any length of time I'm sure you've seem plenty of suspicious short sales. I know I have. The FBI seriously needs to set up a hotline so people can report this crap.

Anyway here is an article from the PE

In the wake of failed attempts at loan modifications, delinquent homeowners increasingly are taking what many consider the next best step to avoid foreclosure: a short sale.

The trend, while also potentially beneficial for lenders, has increased the risk of abuse and fraud, according to real estate experts.

A national report released last week said the red flag is when houses sold short -- for less than enough to cover the mortgage -- are quickly resold for much more, meaning that the original lender probably received less than fair market price.

The potential threat to lenders is increasing with the popularity of short sales. Short sales enable the homeowner to continue to occupy and maintain the home, preserving its value for the lender. By contrast, homes sold in foreclosure are frequently abandoned and exposed to vandalism.

Nationally, the number of short sales in the market has nearly tripled between the second quarter of 2008 and the second quarter of 2010, CoreLogic reports.

The same mushrooming of short sales has occurred in Inland Southern California.

"Two or three years ago, 90 percent of our sales in southwest Riverside County were bank-owned properties, and today about 55 percent are short sales, while bank owned homes are down to about 25 percent," said Gene Wunderlich, government affairs director for the Southwest Riverside County Association of Realtors.

CoreLogic, which issued a report last week about the risk of short sales to the lending industry, described "suspicious transactions" as when a house sold short is resold less than a month later for a price that's at least 10 percent higher or resold less than three months later at a price that's at least 20 percent higher or resold less than six months later at a price that's at least 40 percent higher.

California, with the largest volume of short sales of any state, also has the largest percentage of suspicious transactions in the nation at 34.5 percent, CoreLogic reports.

Wunderlich said there are investor groups active in Southern California that seem to be organized to milk short sales. "Some are negotiating the resale before they close escrow (on the short sale)," he said.

There is nothing wrong if an investor buys a short sale home, fixes it up and then sells it for a solid gain, the report said.

But in analyzing sales by investors, CoreLogic found that "nearly one in six suspicious short sales is resold on the same day, making legitimate increases in value doubtful."

"Lenders are incurring tremendous unnecessary losses in these situations," said CoreLogic. "Short sales that are resold on the same day have an average of 34 percent ($56,947) gain between sale prices."

John Giardinelli, general counsel to eight real estate boards, including four with members in Riverside and San Bernardino Counties, said the boards are educating brokers about how to avoid becoming an instrument of fraud in these situations.

The key, he said, is to make sure all the appraisals and other documents provided to the bank seller of a house are "absolutely accurate" and that all financial arrangements are disclosed in the closing escrow papers.

In some cases, Giardinelli said, investment companies have offered brokers two commissions on the same house, one when the bank-repossessed house is sold to the investors and another when it is flipped to a pre-arranged buyer.

Monday, May 16, 2011

Price per zip code for Riverside

Here is the April price data (per zip code) for SFRs. Sorry the data gets compressed. For some reason it does not like my spreadsheet.
It's city, zipcode, sales numbers, price (x 1000), change from last year and price per sq/ft

Countywide 2,790 $189 -3.10% $99
Aguanga 92536 3 $240 4.30% $111
Banning 92220 46 $123 23.00% $78
Beaumont 92223 69 $172 -8.90% $80
Blythe 92225 11 $100 -32.70% $74
Cabazon 92230 5 $64 2.40% $56
Calimesa 92320 4 $169 4.20% $104
Canyon Lake 92587 30 $193 -5.60% $97
Cathedrl Cty 92234 62 $144 -7.10% $91
Coachella 92236 38 $123 -12.10% $67
Corona 92879 39 $252 -4.90% $146
Corona 92880 74 $345 -5.50% $121
Corona 92881 28 $319 -6.30% $152
Corona 92882 50 $286 2.00% $154
Corona 92883 42 $305 -3.20% $120
Desert Ctr 92239 1 $90 50.00% $51
Dsrt Hot Spr 92240 83 $89 -11.50% $56
Dsrt Hot Spr 92241 8 $107 69.00% $68
Hemet 92543 32 $77 -7.20% $56
Hemet 92544 64 $110 -4.10% $65
Hemet 92545 87 $132 -5.70% $68
Idyllwild 92549 16 $235 3.30% $142
Indian Wells 92210 10 $765 -1.30% $199
Indio 92201 83 $153 -4.80% $86
Indio 92203 74 $190 -9.50% $92
La Quinta 92253 115 $320 -16.90% $135
Lake Elsinre 92530 65 $155 -3.10% $89
Lake Elsinre 92532 46 $190 -9.80% $78
Mecca 92254 1 $75 16.70% $54
Menifee 92584 72 $198 -0.10% $91
Mira Loma 91752 28 $269 -5.80% $141
Moreno Vly 92551 50 $142 1.40% $90
Moreno Vly 92553 70 $135 0.00% $91
Moreno Vly 92555 56 $203 1.00% $82
Moreno Vly 92557 60 $150 -6.30% $99
Mountn Ctr 92561 1 $275 107.50% $157
Murrieta 92562 91 $248 -4.40% $110
Murrieta 92563 76 $241 -1.70% $95
Norco 92860 16 $366 20.00% $157
Nuevo 92567 4 $142 -26.20% $71
Palm Desert 92211 45 $270 -15.60% $136
Palm Desert 92260 33 $295 -13.20% $153
Palm Sprngs 92262 49 $260 -25.20% $147
Palm Sprngs 92264 23 $346 -23.30% $181
Perris 92570 35 $150 8.70% $76
Perris 92571 76 $152 -4.70% $73
Rancho Mrg 92270 42 $535 -0.90% $209
Riverside 92501 25 $170 1.50% $111
Riverside 92503 85 $184 -8.30% $123
Riverside 92504 63 $158 -12.20% $118
Riverside 92505 26 $210 15.50% $119
Riverside 92506 49 $270 24.40% $147
Riverside 92507 17 $205 -4.70% $119
Riverside 92508 40 $261 -5.60% $108
Riverside 92509 64 $161 0.00% $119
San Jacinto 92582 41 $153 -4.70% $59
San Jacinto 92583 38 $123 -2.00% $65
Sun City 92585 25 $180 3.20% $85
Sun City 92586 51 $133 6.00% $88
Temecula 92590 5 $600 -4.00% $172
Temecula 92591 52 $261 3.40% $123
Temecula 92592 103 $280 2.20% $119
Thousand P 92276 7 $145 81.30% $80
White Water 92282 2 $76 -12.10% $54
Wildomar 92595 27 $210 0.00% $94
Winchester 92596 53 $236 -7.50% $92

Friday, May 13, 2011

April not a good month

Data Quicks April report is out and it's a stinker! Sales numbers continue to be pathetic and the median price took a hit last month too. On to the report.....

The prospect of a near-term resurgence in Southern California’s housing market continued to wither last month as home sales fell to the lowest level for an April in three years. Prices trended sideways or down slightly, depending on location, as credit remained tight and distress sales and investor activity continued to dominate the market, a real estate information service reported.

A total of 18,344 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in April. That was down 5.5 percent from 19,412 in March, and down 9.2 percent from 20,205 in April 2010, according to San Diego-based DataQuick. April marked the 10th consecutive month in which Southland sales fell year-over-year.

On average, sales between March and April have increased 0.9 percent since 1988, when DataQuick's statistics begin. April sales have varied from a low of 15,303 in 1995 to a high of 37,905 in 2004. Last month’s sales count was 25.4 percent below the average April sales tally of 24,606. The last time April sales were lower was in April 2008, when 15,615 homes sold.

The 1,024 sales of newly built homes last month marked a 1.9 percent gain from a year earlier, but it was still the Southland’s second-slowest April for new-home sales since at least 1988.

The median price paid for all new and resale Southland houses and condos purchased last month was $280,000, down 0.2 percent from $280,500 in March, and down 1.8 percent from $285,000 in April 2010. The median has declined year-over-year for two consecutive months, and hasn’t posted an annual increase since last December, when it rose 0.3 percent from a year earlier.

The median’s low point for the current real estate cycle was $247,000 in April 2009, while the high point was $505,000 in mid 2007. The peak-to-trough drop was due to a decline in home values as well as a shift in sales toward low-cost homes, especially inland foreclosures.

“The market's in a rut at a time it would normally be building momentum. Two of the more likely forces that could get it going again are more robust job growth and home price reductions. At the moment, the latter appears to be the more likely short-term catalyst,” said John Walsh, DataQuick president.

Sales Volume Median Price
All homes Apr-10 Apr-11 %Chng Apr-10 Apr-11 %Chng
Los Angeles 6,688 6,025 -9.9% $329,500 $320,000 -2.9%
Orange 2,669 2,485 -6.9% $430,000 $430,000 0.0%
Riverside 4,023 3,470 -13.7% $200,000 $190,000 -5.0%
San Bernardino 2,744 2,403 -12.4% $150,000 $147,500 -1.7%
San Diego 3,292 3,277 -0.5% $325,250 $321,750 -1.1%
Ventura 789 684 -13.3% $382,000 $357,500 -6.4%
SoCal 20,205 18,344 -9.2% $285,000 $280,000 -1.8%

Wednesday, April 13, 2011

March numbers from DataQuick

The March report is out and the IE is holding steady median price wise. Sales numbers are down quite a bit from last year though. In addition to the low sales numbers over a quarter of all sales are to investors (and that number is probably much higher in the IE). So the "normal" market is really very bad!

Southern California home sales turned in another lackluster month in March, the result of a fussy mortgage market, slow job growth and a continued wait-and-see attitude among potential buyers and sellers. There were signs, however, that the market was a little less dysfunctional than in recent months, a real estate information service reported.

A total of 19,412 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties in March. That was up 35.1 percent from 14,369 in February, and down 5.2 percent from 20,476 in March 2010, according to DataQuick of San Diego.

Sales always increase from February to March. Last month’s sales count was 21.4 percent below the 24,706 average for all the months of March since 1988. Sales so far this year are 20 percent below the norm. During the last half of 2010 sales were 25-30 percent below average.

Sales of newly built Southland homes totaled 1,144, the lowest March in DataQuick’s statistics, which go back to 1988. The peak March was in 2006 with 7,205 sales. The March new-home average is 3,661.

The median price paid for a Southland home last month was $280,500, up 2.0 percent from $275,000 in February, and down 1.6 percent from $285,000 for March a year ago.

“As an indicator of upcoming trends, the month of March is actually pretty reliable. We got off to a slow start with sales this year and it doesn’t look like that will change anytime soon. Two of the likely game changers in the short run would be a surge in job creation or another round of price corrections,” said John Walsh, DataQuick president.

“The foreclosure issue is going to be with us for a good while. But mortgage availability, or rather the lack thereof, is key. If a well-crafted home loan program comes down the pike, it’s going to make some lending institution the dominant player, at least for a while,” he said.

Absentee buyers – mostly investors and some second-home purchasers – bought 26.0 percent of the Southland homes sold in March, paying a median $205,000. The absentee share of the market reached a peak in February at 26.4 percent. Over the last decade, absentee buyers purchased a monthly average of 16.3 percent of homes.

Cash purchases accounted for 30.5 percent of March home sales, paying a median $205,250. The cash purchase share was down from 32.3 percent in February, the all-time high, but up from 27.9 percent a year earlier. The 10-year monthly average for Southland homes purchased with cash is 13.3 percent. Cash purchases are where there was no indication in the public record that a corresponding purchase loan was recorded.....

The typical monthly mortgage payment that Southland buyers committed themselves to paying was $1,185 last month, up from $1,174 in February and down from $1,220 in March 2010. Adjusted for inflation, current payments are 48.0 percent below typical payments in the spring of 1989, the peak of the prior real estate cycle. They are 57.4 percent below the current cycle’s peak in July 2007.

Indicators of market distress continue to move in different directions. Foreclosure activity remains high by historical standards but is lower than peak levels reached over the last two years. Financing with multiple mortgages is very low, and down payment sizes are stable, DataQuick reported.

Sales Volume Median Price
All homes Mar-10 Mar-11 %Chng Mar-10 Mar-11 %Chng
Los Angeles 6,747 6,590 -2.3% $329,000 $320,000 -2.7%
Orange 2,652 2,615 -1.4% $432,000 $430,000 -0.5%
Riverside 4,156 3,843 -7.5% $198,000 $198,000 -0.0%
San Bernardino 2,955 2,544 -13.9% $152,000 $150,000 -1.3%
San Diego 3,227 3,063 -5.1% $330,000 $325,000 -1.5%
Ventura 739 757 2.4% $375,000 $349,000 -6.9%
SoCal 20,476 19,412 -5.2% $285,000 $280,500 -1.6%

Monday, April 11, 2011

Got gas?

Many see the cost of petroleum as the biggest hurdle to our so called economic recovery. I certainly agree that it's a serious problem and one that will certainly hurt any recovery. The high cost of gasoline will benefit a few oil companies and their shareholders. But the rest of us are getting squeezed and any extra disposable income is going into the gas tank rather than the economy. Eating out will certainly take a hit. Restaurants will probably be one of the first to see the effect of less disposable income. We have already cut back from going out two or three times a week to just Friday nights. Both my wife and myself drive huge gas guzzling, ozone destroying SUV's and spending $90 per fill up hurts a little. Our fuel bill is now well north of $500/mo (our cars are paid off so buying a new car is not an option right now).

Anyone that does any grocery shopping knows how much food has gone up, regardless of the phony inflation numbers Washington puts out. As fuel prices go up the cost of everything we buy will continue to go up. Of course our wages will not keep up. I was fortunate this year and got a whopping 2.8% raise which after taxes increased my check about $40. Unfortunately my medical went up, my life insurance went up, the cost of fuel, food and everything else went up. I figured it all out and even with a $80/month raise it hardly offsets the fact that my fixed monthly expenses increased nearly $470. So even with a raise I am $390/mo poorer than I was last year. That's $400 a month less I have to spend on fun stuff. What's the world coming to? Am I gonna have to drink cheaper scotch, smoke cheaper cigars, play crappier golf courses.

What will the high cost of Gas do to the real estate market out here. Most of the people in the IE work a long way from home. So is buying a home in the far flung areas like Hemet or San Jacinto a feasible option with gas at $4 or $5 a gallon. It might force people to carpool but that's not an option for a lot of people. I think it will take high gas prices for a year or more before it starts to affect the prices. Most people expect the price of gas to come back down and it will take a while to change that mindset. But once it changes will there be any buyers for those distant suburbs?

Sunday, April 10, 2011

Research show's we've over-corrected!

An interesting article in the Press about a new investment group buying up homes in the IE. They feel prices have over-corrected and they plan to buy, rent for a few years and sell. Of course they are picking up stuff for cash at the trustee sale. I would agree if you have cash and can purchase at the trustee sale then yes, you are paying less than the actual market value. But has the market value over-corrected? I don't think so. All the numbers I look at are saying the fundamental ratios are very close to long term trend values when looking at income or rental ratios.

TwinRock Partners is headed by two managing partners: Mike Meyer, an Orange County real estate accountant who has advised the likes of Irvine Co. owner Donald Bren, and Alex Philips, a seasoned real estate acquisition and investment analyst.

Meyer and Philips said their research shows that the Inland Empire's home prices have "overcorrected," making this a smart time for investors to buy foreclosed houses and hold them as rentals in anticipation that values will rebound substantially in the next five to seven years.

So far TwinRock has purchased 22 homes in Moreno Valley, Riverside, Corona, Rialto, San Bernardino, Highland, Murrieta, Wildomar and Temecula, and the company has plans to buy several hundred more, said Meyer.

Earlier this year, TwinRock put together a $6 million fund to enable the company to buy about 40 Inland homes and it is getting ready to raise another $15 million, Philips said. The firm's investment model primarily calls for buying houses with cash at trustee auctions conducted each weekday at Inland courthouses, he said.

Money to buy the houses is coming from sophisticated investors with knowledge of real estate including homebuilders, land developers, bankers, lawyers, accountants and wealth managers, he said.

Bruce Norris, who heads The Norris Group, a Riverside-based real estate investment company, said most houses sold at trustee auctions are purchased by investors who intend to quickly sell them at a profit that is greater than the return they could expect from buying houses and holding them as rentals before reselling them.

Still, Norris agreed that currently "it makes sense to buy because the houses are priced below their replacement cost." He said TwinRock "will make money, I'm sure."

Monday, April 4, 2011

how to lose 65% in 4 years

The most obvious sign of bubble mania for me was stopping in at a new tract in Moreno Valley in Early 2007 and seeing prices of $700k. These were nice big homes on 1/2 acre lots but they were still in MORENO VALLEY. And get this, $700k got you VINYL flooring in the kitchen and bathrooms. You needed to drop another $50k to $100k to make these houses nice. So here we are 4 years later and they are selling for 65% off.

28615 Dracaea This was the smallest home in the tract at 3500 s/f. Some poor schmuck paid $717K for this house. He must have put a few upgrades in because the small model was "only" selling for around $670K when I looked. Well HAMP and HARP and HOPE and whatever else failed to keep this one from going "back to bene". Even at $253,800 they could not find a taker on the courthouse steps. Now it's listed for $249k. That's 65% off of the ridiculously overpriced original sale. Now at $249k this is probably a pretty decent deal if you don't mind living in MoVal.

By the way, they stopped building these for about 2 years and then threw up the final few homes last year. They still managed to find buyers willing to pay over $400k for that new house smell. They were easily upside down $100k the minute they signed the papers...... A sucker born every minute......

Tuesday, March 29, 2011

Foreclosed 3 times in 5 years!

Stay the hell away from this house! Seriously, someone put the whammy on this thing. It's triple jinxed. 27684 Fairmont in MoVal has gone through 3 foreclosures in 5 years. If that's not a record it has to at least be tied.

Purchased new
Dec 15, 2004 Sold (Public Records) $380,000


Jan 18, 2006 Sold (Public Records) $351,000

Sold at the peak as REO
May 22, 2006 Sold (Public Records) $430,000

two years later
Apr 15, 2008 Sold (Public Records) $198,817

Sold again as REO
Aug 29, 2008 Sold (Public Records) $260,000

Aug 12, 2010 Sold (Public Records) $211,806

And now it's listed for $240k. That's seems about $40k too high to me and Zillow actually agrees with me. But I wouldn't buy this thing, it's freeking hexed!

Saturday, March 19, 2011

And this is why you better be buying for the long term

This is a pretty good read about a guy that bought and a couple of years later wants to sell. Big losses!

Losing BIG

Let me preface this by saying that I never wanted to buy a home. I knew the financial risks, the fact that in most cases you have to stay in a home a long time to even have a chance of making it a profitable investment, and that a home can take a lot of effort and money to maintain. My wife, on the other hand, just couldn't fathom the idea of not purchasing a house once our son was born even though we had lived together happily in various apartments for almost 10 years. While I tried in vein to explain the many downsides to home ownership, I just couldn't break through to her, and therefore gave in as any good husband should. Big mistake!

Three years after purchasing our home in the spring of 2008, my wife now sees the light and finds the idea of home ownership as repugnant as I always have. Due to a multitude of reasons and factors, we decided to put our home on the market. It's now been over a year and we've yet to sell, but when we do, we stand to lose a boatload of money. As hard as it is to believe at times, and while the two often correlate, sometimes happiness really is more important than money.....

Skip ahead again to the present. With continued real estate market issues, we now have our home listed at $249,000, a full $45,000 under our purchase price. Now you might be asking yourself why we don't just take it off the market and wait out this rough patch. It's a good question, one that I have asked myself a multitude of times, and one that's hard to answer without a person being in our situation. Let's just say that being closer to my ailing mother in Washington, our happiness, and the opportunity to be out from under what to us is a heavy burden, is worth the loss, be it a big one. So get ready for the numbers.

Even if we sell our home for the full asking price, which I don't count on happening in this market, it will be well under the price we paid three years ago.

- Loss of $45,000 on price of home
- 5% Realtor's commission on $249,000 is $12,450
- 3% closing costs on $249,000 is $7,470
- Total losses on the sale of the home at its current price would be just under $65,000.

This doesn't even factor in the increased costs of owning a home as compared with the apartment we were renting for $780 a month with free heat, water and trash. Things like annual property taxes, homeowner's insurance, increased utilities, repairs and maintenance, interest on our mortgage, and similar costs add additional tens of thousands of dollars to our losses, unless you want to consider them costs of the opportunity to live in a house.

Tuesday, March 15, 2011

I'll take it!

Another notch down or teaser short sale listings? I have to wonder with some of the listings popping up. Up in Norco Hills (Bretton Gate) there are 2 new short sale listings under $400k. One of them is decked out with a pool, putting green and stables. 1457 Foxtrotter is the house I speak of. This 3900 s/f 5 bedroom house is pretty darn nice and I cannot see any lender letting this go for the $400k that it's listed for. Based on recent comps this thing should easily fetch $550k or more. Then there is 230 Haflinger listed at $350k. Again based on comps it's probably worth $450k. These two should get a lot of attention and probably a lot of offers too. It will be interesting to see if they actually sell for anything close to listing price. If they do, they instantly put all the recent buyers a good $100k underwater!

Feb's numbers from DQ

The DQ report for Feb is out. The sale numbers are terrible however the median in the IE managed to inch up slightly over January (that's fairly normal). YoY median is down slightly though. It's fairly obvious that a very high percentage of the market is investors. 32% of sales were cash! And I would bet it's a higher percentage in the IE..........................

Southern California’s housing market remained sluggish in February despite relatively strong demand from investors and others paying cash for homes. Prices appeared fairly flat as many potential home buyers stayed on the sidelines and waited – whether for a sign values have bottomed, job security has improved or credit has loosened, a real estate information service reported.

Last month 14,369 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. That was down 0.6 percent from 14,458 in January, and down 6.4 percent from 15,359 in February 2010, according to DataQuick Information Systems of San Diego.

The total number of homes sold last month was the lowest for a February since 2008, when 10,777 sold, and the second-lowest since 1995, when 12,459 sold. Last month’s sales fell 19.5 percent short of the Southland’s average February sales tally – 17,848 – since 1988.

Last month’s distressed sales – the combination of sales of foreclosed homes and “short sales” – accounted for well over half of the resale market.

Foreclosure resales – properties foreclosed on in the prior 12 months – made up 37.1 percent of resales last month, up from 36.8 percent in January but down from 42.4 percent a year ago. Over the past year foreclosure resales hit a low of 32.8 percent last June but since then they’ve trended higher. Foreclosure resales peaked at 56.7 percent in February 2009.

Short sales – transactions where the sale price fell short of what was owed on the property – made up an estimated 19.8 percent of Southland resales last month. That was up from an estimated 19.7 percent in January, 18.4 percent a year earlier, and 12.0 percent two years ago.

The abundance of distressed homes for sale continues to attract unusually high levels of investor and cash-only buyers. Buyers who paid cash accounted for a record 31.7 percent of February home sales, paying a median $200,000. That was up from 30.4 in January and 30.1 percent a year earlier. The February cash level was the highest for any month in DataQuick’s statistics back to 1988. The 10-year monthly average for the percentage of Southland homes purchased with cash is 13.1 percent. Cash purchases are where there was no indication in the public record that a corresponding purchase loan was recorded.

At the county level last month, the overall median sale price fell on a year-over-year basis in four counties and was unchanged in two. Declines from a year ago were logged in Orange (-1.7 percent), Riverside (-1.0 percent), San Diego (-4.3 percent), and Ventura (-1.4 percent) counties, while the median was the same as a year ago in Los Angeles and San Bernardino counties.

The median paid for the largest home-type category – resale single-family detached houses – fell year-over-year last month in Orange (-3.1 percent), San Diego (-3.1 percent) and Ventura (-9.6 percent) counties. The other three counties recorded annual gains ranging from 2.6 percent in Los Angeles and Riverside counties to 3.6 percent in San Bernardino County.

The typical monthly mortgage payment that Southland buyers committed themselves to paying was $1,174 last month, up from $1,128 in January and down from $1,180 in February 2010. Adjusted for inflation, current payments are 48.1 percent below typical payments in the spring of 1989, the peak of the prior real estate cycle. They are 57.4 percent below the current cycle’s peak in July 2007.

Sales Volume Median Price
All homes Feb-10 Feb-11 %Chng Feb-10 Feb-11 %Chng
Los Angeles 5,034 4,736 -5.90% $315,000 $315,000 0.00%
Orange 1,986 1,903 -4.20% $417,000 $410,000 -1.70%
Riverside 3,199 2,842 -11.20% $197,000 $195,000 -1.00%
San Bernardino 2,095 1,974 -5.80% $150,000 $150,000 0.00%
San Diego 2,465 2,330 -5.50% $322,000 $308,000 -4.30%
Ventura 580 584 0.70% $350,000 $345,000 -1.40%
SoCal 15,359 14,369 -6.40% $275,000 $275,000 0.00%

Saturday, March 5, 2011

More Mortgage Mod news

State attorneys general have presented the nation’s five biggest banks with a list of demands that could drastically alter the foreclosure process and give the government sweeping authority over how mortgage servicers deal with millions of Americans in danger of losing their homes.

Under the blueprint, banks would be prohibited from starting foreclosure proceedings while a borrower was actively trying to lower the interest rate or ease other terms of the home loan, a process known as a mortgage modification.

Any borrower who successfully made three payments in a trial modification would be given a permanent modification. When a modification was denied, it would be automatically reviewed by an ombudsman or independent review panel.

The proposed changes, which will be discussed by the attorneys general when they meet in Washington early next week, would compel the banks to treat each borrower in default individually.


I don't see how they can force the lenders to do this but who knows anymore. It will certainly get a lot of borrowers excited about the prospect of finally getting a loan mod.

Wednesday, February 16, 2011

Are prices really falling?

The median prices for January are out and all over California the median is falling. But are prices in the IE falling? If they are it's certainly not in the areas I track. Prices are pretty much the same as they've been for a couple of years now. I see a few homes sell for less than I thought and then a few sell for more but overall the average has been remarkably stable for quite a long time. The reported median price is, and has always been a poor indicator of actual prices. In 2007 when the market was falling apart at the seams the median was climbing to record highs. But that was because all the low end sales went away, not because values were going up. I think we are seeing a similar thing right now. With the end of the tax credits and tight financing the high end is getting pummeled while the low end is still busy with investors and first time buyers. The mix is moving towards the low end.

This is gonna be an interesting year. The government seems to have had enough and seems to be losing interest in saving the underwater homeowners. They seem to want out of the mortgage business based on their latest reports on fannie and freddy. Who know what the banks will do next. Will they fire up the foreclosure engine, or continue to let people live rent free for years on end. Will inflation take off? What are interest rates gonna do? Either way I think the IE is pretty well scraping the bottom. We are back to rental equilibrium, and nearly back to income equilibrium. So by most tradition measures home prices are back to where they should be in the IE. If the employment numbers ever get back to a reasonable level we might come out of this mess sooner than most areas.

Tuesday, February 15, 2011

January sales report

The January dataquick report is out. Sale numbers fell off a cliff, that's fairly normal though this time of year. Median price fell nearly everywhere. The IE was only down a small amount since we are much closer to the bottom than the OC or LA. I suspect that the OC and LA will start to see some large declines now. This mirrors the pattern of the early 90's where the IE fell hard and fast while the coastal areas thought they were "immune" because everyone wanted to live there. Not so much as it turned out. They fell just as far as the IE, it just took them a couple of extra years.

Southland homes sold at the slowest pace for a January in three years – and the second-slowest in 15 – amid record-low new-home sales, tight credit, and a persistent reluctance among would-be buyers. The median sale price dipped slightly from a year ago but fell more than usual from December as investors and others targeting lower-cost properties accounted for a larger share of sales, a real estate information service reported.

The total number of homes sold last month was the lowest for a January since 2008, when 9,983 sold, and the second-lowest since 1996. Last month’s sales fell 18.8 percent below the average January sales tally of 17,802.

January new-home sales were the lowest for any month in DataQuick’s records back to 1988. Builders have struggled to compete with prices on resale homes, especially distressed properties.

But what’s proven the bane of the building industry has fueled a boom among investors, who appeared to be as active as ever last month.

Absentee buyers – mostly investors and some second-home purchasers – bought a record 24.8 percent of the homes sold in January, paying a median $198,500. Over the last decade, absentee buyers purchased a monthly average of about 16 percent of all Southland homes.

Buyers who appeared to have paid all cash – meaning there was no indication that a corresponding purchase loan was recorded – accounted for a near-record 29.5 percent of January sales, paying a median $190,000. So far, the peak for cash sales was 30.1 percent last February. The 10-year monthly average for Southland homes purchased with cash is about 13 percent.

“Last month was sort of a flashback to January last year: Sales were lousy, but many investors and others looking for bargains stayed active. They kept working the distress-heavy, lower-cost markets through the holidays, which translated into a relatively high level of investor and cash deals closing last month. It helps explain the larger-than-usual, month-to-month dip in the median sale price,” said John Walsh, DataQuick president.

Last month 14,458 new and resale houses and condos sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties. That was down 26.0 percent from 19,528 in December, and down 5.9 percent from 15,361 in January 2010, according to DataQuick Information Systems of San Diego.

The median price paid for a Southland home last month was $270,000, down 6.9 percent from $290,000 in December, and down 0.6 percent from $271,500 in January 2010. It was the median’s lowest level since it was $268,000 in July 2009. Last month’s year-over-year decline in the median was the first since October 2009, when the median fell 6.7 percent, to $280,000.

The median’s low point for the current real estate cycle was $247,000 in April 2009, while the high point was $505,000 in mid 2007. The peak-to-trough drop was due to a decline in home values as well as a shift in sales toward low-cost homes, especially inland foreclosures.

The typical monthly mortgage payment that Southland buyers committed themselves to paying was $1,128 last month, down from $1,205 in December and down from $1,170 in January 2010. Adjusted for inflation, current payments are 49.8 percent below typical payments in the spring of 1989, the peak of the prior real estate cycle. They are 58.9 percent below the current cycle’s peak in July 2007.

All homes Jan-10 Jan-11 %Chng Jan-10 Jan-11 %Chng
5,228 4,908 -6.10% $325,000 $300,000 -7.70%
Orange 1,867 1,929 3.30% $425,000 $415,000 -2.40%
Riverside 3,162 2,738 -13.40% $195,000 $190,000 -2.60%
San Berdu
2,252 2,085 -7.40% $150,000 $151,500 1.00%
San Diego
2,322 2,248 -3.20% $305,000 $304,000 -0.30%
Ventura 530 550 3.80% $360,000 $350,000 -2.80%
SoCal 15,361 14,458 -5.90% $271,500 $270,000 -0.60%

Saturday, February 12, 2011

Another Ass Clown award

Seriously, I thought I was done with the ass-clown award. But there are STILL people who think homes are going up $200k a year. I give you 350 Oldenburg in Corona. This place was foreclose on and picked up by the current owner for $435k in April 2009. Now 2 years later they somehow figure it has gone up in value nearly $300k! They just listed it for $725k. No pics yet but it doesn't matter, the toilets could be plated in gold leaf and it's still not gonna fetch $725k.

Friday, February 11, 2011

OMG they still don't get it!

The California association of realtards STILL thinks it's ok to buy a home that costs 6 time your annual income!

Historically low interest rates and a slight decline in home prices in the fourth quarter of 2010 meant that the percentage of first-time buyers who could afford to purchase an entry level home in California rose to 69 percent, up from 66 percent in the third quarter and 64 percent a year earlier.

The report from the California Association of Realtors showed that in the last three months of 2010, 82 percent of first time buyers in San Bernardino County were able to purchase an entry-level priced home of $138,050. They needed a minimum household income of $21,300 to qualify. (that's 6.5 times income)

In the fourth quarter in Riverside County 79 percent of first time buyers could afford a home. They needed a minimum income of $25,200 to buy an entry-level house of $163,010.(also 6.5 times income)

The most affordable region in the state was the High Desert, where 85 percent of first -time buyers could afford an entry level home of $106,320, for which they could qualify with an annual income of $16,500. (also 6.5 times income)

Seriously, the realtards are still trying to convince people to spend double the traditional levels on housing. How the hell is anyone making 25K a year gonna afford a $163k house? These people are bringing home about $1500/mo. Subtract utilities, food, transportation and what is left to pay a mortgage? I'd love to see just what they used to come up with these numbers.

Thursday, February 10, 2011

Austin Powers or RuPaul?

OMG, this is the best listing I've seen in a long time. It's actually pending, but check out the pics of this place. I can't tell if this is the home of Austin Powers or some flaming drag queen.

The sex palace!

I just noticed the neon sign and have an pretty good idea it's drag queen and not Austin Powers. My wife looked at the pics and said "uber-gay".....

Saturday, January 22, 2011

check the comps, PLEASE

With the large rush of homes hitting the market lately I'm seeing a lot of sellers smoking the dream pipe again. Here's one in Norco Hills. 209 Friesian is a big 5 bed/3.5 bath home overlooking the golf course. It's a funky flooorplan but I kinda like it and actually did put an offer in on a home like this in late 2009. The bad thing about this plan is the layout of the garages. They are on the side of the house and while it's nice that they are hidden from view it's VERY difficult to get cars in and out of them as you have to turn 90 degrees to get into the main garage. There are two other small single garages too. This fella bought this home early on in the crash. He jumped off the fence WAY too soon and paid $625k for this as an REO in Mid 08. He thought he was getting a deal. It originally sold for $1.2M in late 06, got foreclosed on in late 07 (buyer probably never made a payment). They listed in at $780k in late 07. So the buyer pays $625 and thinks he's getting a steal. Fast forward 2 years and these are selling from the mid $400s to the mid $500's. The one I offered on sold for $465k and it had a pretty nice pool.

This guys house sit's WAY up above the 17th fairway. I don't think you could consider it "on the course" There's at least 100 yards of scrub brush hillside between the house and the course. The landscaping looks ok but the freeking realtard only has 2 pis of the outside. The listing price is $699k! That's at least $150k more than this house has any hope of selling for. Personally I think it's at least $200k more than it will sell for. And I'm not basing this on my magic 8-ball. All the seller needs do is look at a recent comp. And it happens to be across the street and 4 houses up. 190 Friesian is the same floorplan but with a spectacular back yard and a horse corral. This home just closed for $525k! I'd take this home over Mr. Delusional's any day of the week.

Thursday, January 20, 2011

The bubble must be back

The bubble days are back. This seller thinks so anyway. 8024 Sanctuary in the Retreat just listed for $748k. That's $223k more than the owner paid less than 2 years ago. Other than some landscaping and paint I don't see that he's done much to the house. I looked at this home in 2009 when it was for sale and although it was nice it was actually priced about $50k higher than some of the identical floorplan homes were selling for. This one does back up to the course but the yard is small and it's right next to the clubhouse. I'm not sure what makes a person think in this economy that they can get $223K profit on this house. The realtor should have smacked the seller for even suggesting such a price. On the plus side, the pictures are great. I'll give Tiffanie some brownie points for the listing. Well written and good pics, that's nice to see once in a while. But the price.......

Monday, January 17, 2011

The tide's coming in.

If you are looking for a property you might have noticed a LOT of new listings hitting the market. It seems like the banks are getting serious about turing over their non-performing assets. There was a lot of talk about this late last year and for the most part it was expected. But after a few years of never knowing what's going to happen next it's hard to beleive anything you read these days. But looking at the latest numbers from housing tracker it's pretty obvious that the wave is coming in. The only thing that is in question is how big this wave will be and is there enough demand to absorb this additional inventory. You might also notice that the average listing price has tanked this week. The high end has fallen nearly $100k since it's post crash high of $435k in August 2009. The median has fallen $30k from it's post crash high of $240k in Sept 2009. You can see the high end is VERY weak and I have been saying that for years now. There's just not that many people that can afford $500K plus homes in the IE.

Tuesday, January 11, 2011

Time to break out the Ass-Clown award

There's a new bread of Ass-Clowns popping up. These are the delusional flippers or the people that recently purchased a home and for whatever reason want to sell it now. Today's home is the latter. The buyer picked up 4507 Birdie Dr in June of 09 for $570k. The house is a 4 bed, 3.5 bath home and nearly 3900 sq/ft. He paid top dollar for it but it is a pretty nice house. However the kitchen cabinets and appliances are low end as is the bathroom. The primary upgrades are outside where it has a nice pool. This home has no view to speak of either. Now, a little over a year later in a market that has dropped off considerably from mid 09 he thinks he can make $100k on this house! Good luck with that fella. If he's lucky he can get out for what he paid.

Just to drive the point home there is 4545 Edgewater Cir. just around the corner from his place. This one is an REO but it's in great shape and has a great view of the Eagle Glen golf course. Even if that view starts with the parking lot. This home is quite a bit larger than ass-clowns place. It's a 5 bedroom, 4.5 bath home of 4136 sq/ft. The kitchen looks nicer, the bathrooms look comparable but this house has a much better view. The listing agent for this one had high hopes for it too. Initially it listed for $580k but it's down to a more reasonable $499k. At this price there's a good chance this home will sell fairly quickly.

Sunday, January 9, 2011

Golf foreclosure

A few years ago I posted that anyone purchasing in a new golf community should think twice because you never know what's going to happen to a golf course, especially in an economic crash. The first victim was Mountain View golf course in Corona. All those homes that previously had a beautiful golf course view are now looking at acres of weeds. We all know what that did to the property values.

The latest course to fall was Dos Lagos in South Corona. I figured that this place would go belly up because of the fact they could not afford to even build a club house. B of A finally foreclosed on the golf course. So far they are keeping it a golf course. They have brought in a management team to run it for them. I suspect they will try to sell it, after all Banks are not in the biz of running golf courses. Especially once they find out how much money they will lose on this thing. The big question for the homeowners around it has to be what's going to happen to it. Golf courses cost a fortune to maintain. With a lot of competition for players, courses have been lowering their green fees for several years now. Making it harder and harder to stay in the "green". If the course cannot make any money, no one will buy it as a golf course. They might if they can bulldoze it and throw homes on it though.

So I will repeat my warning about golf course communities. Be careful, just because it's a golf course today, does not mean it will be a golf course next year!