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October was a relatively busy month for the Million-Dollar Real Estate Market in Southern California. Accroding to the SoCal MLS database, there were 591 sales in all of Southern California over $1,000,000, with the highest sale at $13,200,000 (listed at $17,900,000) in October. The average sales price of Million-Dollar Plus properties $1,837,199 (Average asking price of those sales was $1,987,707). The average discount off of a Million-Dollar Plus home was 5% of current asking price and 12% of original asking price. Average days on market was 127, with highest days on market 1,099! Southern California is left with 7,171 Million-Dollar Plus active listings as of 10/31/2009. So, what does all of this mean? You will still find over a 12 month supply of Million-Dollar Plus homes available throughout Southern California. The average Active Million-Dollar listing is just under $3,000,000 and has been for sale 145 days. For a Market Snapshot of any home in Southern California, log onto www.MyKWRealtor.com To get a free list of homes for sale, log onto www.LiveInSignalHill.com |
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October was a relatively slow month for Real Estate in Signal Hill. Accroding to the SoCal MLS database, there were 64 sales in all of Lakewood in October 61 Single Family sales 3 Condo/Attached sales No homes sold above $650,000. No condos sold above $250,000. Average days on market was 64 Lakewood is left with 170 active listings as of 10/31/2009. So, what does all of this mean? There are only about 2.5 months supply of properties available, and over almost 90% of the available homes are below $500,000 where there are still many, many buyers. Unfortunately, a high number of those homes still on the market are short sales. On a positive note, I just closed escrow on a home in the Westgate area of Lakewood for $649,900! Now there's a start! For a Market Snapshot of any home in Southern California, log onto www.MyKWRealtor.com To get a free list of homes for sale, log onto www.RDaskam.com
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October was a relatively slow month for Real Estate in Signal Hill.
Accroding to the SoCal MLS database, there were
13 sales in all of Signal Hill in October
5 Single Family sales
8 Condo/Attached sales
No homes sold above $600,000.
No condos sold above $400,000.
Average days on market was 59.9
Signal Hill is left with 60 active listings as of 10/31/2009.
So, what does all of this mean? There are still over 4 months supply of properties available, and over 1/2 of the available homes are above $600,000, where there are very few buyers.
On a positive note, I just closed escrow on a home in Signal Hill today for $770,000! Now there's a start!
For a Market Snapshot of any home in Southern California, log onto www.MyKWRealtor.com
To get a free list of homes for sale, log onto www.LiveInSignalHill.com
Orange County, CA, quick summary:
| Residential Sold Stats - September 2009 | |||||||||||
| Orange County | |||||||||||
| COE Date used for Off Market Date | |||||||||||
| As of October 19, 2009 | Attached | Detached | |||||||||
| % Change | % Change | ||||||||||
| Prior Year | Prior Year | Short | Other | Total | |||||||
| September 2009 | 1 | Sales | REOs | Distressed | Distressed | ||||||
| Total Sales Volume | $309,038,002 | 8.90% | $1,046,544,680 | 13.35% | 2 | ||||||
| Average Sales Price | $331,942 | -1.51% | $687,160 | 6.06% | 3 | ||||||
| Median Sales Price | $310,000 | 1.47% | $512,600 | 2.44% | 4 | ||||||
| Number of Units Sold | 931 | 10.57% | 1523 | 6.88% | 5 | 477 | 412 | 23 | 912 | ||
| Average DOM | 77 | 8.45% | 67 | -9.46% | 6 | 19.4% | 16.8% | 0.9% | 37.2% |
October 18, 2009
I was recently asked to comment on these three questions. Here are my thoughts.
Real estate 3-5 years ago meant being more of an "order-taker" where clients came to you, told you what they wanted, you negotiated the deal and walked it through a relatively smooth transaction. The key then was being the "winning" buyer. Buyers were offering several thousand dollars over asking price, removing contingencies (inspections, loans, etc.) just to be the one picked by the seller. The odds of closing escrow once your buyer was seemed to be 95%+. Today, many sellers are upside down in the homes (they owe more than the home is worth), and unless an agent is a specialist in Distressed property sales, they will cause more harm than good to the seller. Many sellers can't sell now because of their loan balances and won't qualify for a short sale (where their lender takes any loss on the value of the property vs. the actual net proceeds) because the owner doesn't have any kind of financial hardship. Today, agents can't just take any listing, throw a sign in front of it and wait for the offers to flow in. Homeowners need to be pre-qualified to see if they can even sell their home. For those properties that are listed and can be sold, it's another big can of worms. There is a lot of more marketing that needs to go into selling property now because buyers are very skittish about making a purchase. Once a buyer is found, then it takes a lot of work, skill and finesse to get the deal to actually close escrow. Buyers need to actually make enough money today to make their house payment! Lenders are very tight with their money, they make buyers prove everything on their loan application. Very few escrows are able to close in 30 days right now due to the loan requirements that weren't there 3-5 years ago.
Worst case scenario, real estate in 3-5 years will be stagnant to today's market. Lenders will still be very tight with their money, but interest rates will be much higher due to inflation. We will likely see a pretty high amount of inflation due to the trillions of dollars the Federal Government has printed in order to pay for the stimulus packages over the past year. Once the Fed concludes that we are headed back out of the recession, short term interest rates will be increased in order to try to limit the amount of Inflation. Mortgage lenders & the secondary market that buys mortgages will begin to demand a higher rate of return on their investments, thereby forcing mortgage rates to go higher and we will see both the cost of 1st trust deed loans and 2nd trust deed loans (lines of equity, etc.) increase rates. With inflation, (food & clothing start costing more, credit cards tied to the Fed rate increasing their interest rate, and the increase in mortgage interest rates) the cost to buy a home will increase because the monthly payment will increase dramatically. This will further slow any significant price increases for real estate. Our worst case is that real estate values don't move up much, if any, over the next 3-5 years.
Best case scenario for the next 3-5 years will give us low inflation due to some miracle that the Fed does. If inflation stays low, the overall cost of living will remain stable, interest rates will remain relatively stable, and buyers that are on the fence now, or buyers that are able to get the new job they want in the next 3 years will then be able to buy a new. As more and more of the 'first-time buyers' or buyers under the $500,000 market come out of the wood work, buy a home, that will free up those sellers to make the move up and the domino effect takes place, with more and more real estate sales in the higher-end market. Another best case scenario is that banks begin to loosen their credit standards a bit, allowing a renter who is paying $2500/month in rent to now buy a home with a payment of $3000/month, because after their tax benefit, their payment will actually be less than their rent was at $2500/month. There is a good chance that we will be in the middle somewhere, where inflation is radically high, mortgage rates don't double, and banks get back into the business they truly make money from, lending on home purchases.
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FindRichardOnline blog is dedicated to assisting clients & Realtors® in making the best real estate decisions possible. Sharing information, ideas & techniques is my intent and goal. DRE#01091037
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