Keith Sorem

Burbank, like other local markets, is seeing a very busy spring selling season. Buyers may be waiting on the sidelines, however there is a lot to think about, not just dream about.

Market Index

In most markets the last peak was in May and June of 2007. Burbank's market index in May of 2008 reached 0.31, surpassing the previous peak of 0.30.

Pending Ratio

Homes going into escrow mean homes closing escrow, which in most cases means reduced inventory. When inventory declines, price go up, right? So for the last few months the pending ratio has been I increasing: February 0.55. March 0.68, April 0.49, and May 0.70. The previous high was May of .07 with 0.58, so that tells us that the market is heating up. Don't get me wrong, we have a long way to go.

Average Sales Price

In May of 2007 the average sales price was $655,826, which declined $(88,712) to $567,114 or a drop of -13.53%. I like to compare the price per square foot to verify the shifts in value.

Burbank's price per square foot in May of 2007 was $438.39, which declined -$55.72, or a drop of -12.71%, so it is fair to say that values have dropped about 13%. Bear in mind that prices have stopped declining, primarily because the listing inventory is at a low of 300 listings. The last time we hit that mark was May of 2007 with 301 listings.

So, what does this all mean to you? Inventory is declining, pending sales are up, so unless a large wave of new listings hits the market (which may occur - but it may not) it appears that prices are on their way back up.

If I were a buyer, I would buy now (for the right price and property). If I were a seller, get a top agent who knows who to help you get every dime out your home.

Data provided by SRAR MLS is not guaranteed, has not been verified, and is subject to change.

All markets go through cycles, and Burbank is no exception. For the last two years we knew that Burbank was experiencing a buyer's market and the question has always been "when is it going to hit bottom?". My answer has always been the same, that we will know until two or three months AFTER the market is headed back up.

Despite what you may read or see in the media, things might be changing. First, the Market Index for the month of April hit 0.24, the highest since the mortgage meltdown last August. There is a rule of thumb that you need three consecutive periods to plot a trend, and Burbank seems to qualify. We are seeing multiple offers on well-priced properties, escrows opening in two to four weeks.

The other big question I am asked is what is going to happen to home prices. Buyers want them to return to 1992 levels, Sellers feel as if they are being robbed at gunpoint as they have seen their equity evaporate.

Using average sale prices it we have seen a shift from $665,795 in 2007 to $557,468, for a net change of -$108,327 or a decline of 16.5%. Due to the drop in entry level home sales, we need to confirm this change by looking at price per square foot.

The price per square foot has shown a similar trend, decreasing from $461 per square foot in April 2007 to $359 in 2008. The average homes size only increased 112 square feet, reflecting the decline in the sales of smaller, entry-level homes.

Volume is increasing, if I were buying I'd be looking very hard at purchasing a property sooner than later.

For help buying or selling contact me Keith@BeautifulBurbankHomes.com or 1-888-284-2056 toll free.

Data from ITech MLS has not been verified, is not guaranteed, and is subject to change.

Glendale, like most markets in Southern California, has seen a shift from a seller's market to a strong buyer's market. Fueled by the mortgage meltdown in August and September of 2007, the number of buyers qualified to purchase homes has been severely decreased due to more restrictive lending guidelines. Homeowners who purchased property with Adjustable Rate Mortgages (ARMs) found themselves facing adjusting interest rates that in some cases forced them to either sell their home or even face foreclosure. Many homes are on the market not because the owners wanted to sell, but because they had to sell. The shrinking pool of buyers, coupled with the increase in inventory, has caused a drop in home prices. For many home buyers this is the first opportunity they will had to purchase an affordable home.

The April 2008 Regional Market Index is a summary index combining new listings and escrows, along with sold properties and days on market. The cumulative result is a market index. It is important to note that after six months of a static market, the market index has shifted upward, perhaps indicating a change in the downward trend.

The next graph shows the list price versus sold prices for homes. Since April, 2008, the average sale price has dropped 4.7%, quite big difference from the regional figures of 20% or more. This is primarily due to the lack of new construction in Glendale. With very little new home inventory, there is simply not as great a shift in overall inventory. The shift in lending guidelines has drastically reduced activity in the first time home buyer market, primarily town homes and condominiums, so with fewer purchases and sales in those price points the average price is skewed upward.

To provide another range of value the third graph shows the change in the price per square foot of homes sold. The price per square foot has declined 11% since last April; also the average square footage has increased 7.6%, again reflecting a smaller amount of homes with smaller square footage (condos and town homes) that are in the sales mix.

In summary the reports indicate that although overall property prices have declined about 10-14%, due to Glendale's many positive attributes such as excellent schools, and outstanding city services such as our police and fire departments, and quality medical facilities Glendale is still a preferred place to live. With the opening of the Americana at Brand, along with numerous other developments, including the expansion of DreamWorks and Walt Disney, for the foreseeable future Glendale will continue to be somewhat isolated from the drastic swings in home values that other outlying communities are seeing.

Note: Data is from iTech MLS, has not been verified, is not guaranteed, and is subject to change.

The key to understanding the market is looking at the market trends. We use a Market Index to put the market into a number that we can compare and track trends. Above 1.20 is a seller's market, between 1.20 and 0.80 is a neutral market, and below 0.80 is a buyer's market. Burbank's trends mirror the other surrounding markets (not surprising).

August (prior to the mortgage industry shift), and December, we see a curious trend. From 0.23, then 0.17 for Septembe,r October, and November, then back up in December to 0.22.. Now, December, 2006 had a market index of 0.53, so in numerical terms the market dropped more than other markets. For example, last December Glendale was 0.38. So it seems that Burbank was actually doing better than some local markets last December, and not is actually more in line with them..

Data is from iTech MLS. Data is deemed reliable, has not been verified, and is subject to change.

One of the main reasons that Burbank's market index shifted downward is the relatively large number of new listings in November, 132 in 2007 compared to 64 in 2006, then in December 62 in 2007, versus 44 in 2006. Why the shift? When a property is re-listed, for statistical purposes it shows up as a "new listing", even if the listing is re-newed by the same Realtor. The bottom line is that there are more listings, and more inventory. Last December total inventory was 233, in 2007 it was 334. This indicates to me that people that have to sell are listing and trying to get their homes sold.

Even considering the shift in the market, along with the significant changes occurring in the mortgage industry, homes are still selling. If you are a buyer, and are waiting for prices to drop, this may well be the time to start getting serious.

F\or sellers know that buyers are looking for VALUE. Properties that show the best value sell first, leaving the rest of the inventory to sit on the market. Homes that are properly prepared, marketed, and priced, will still sell in under a month. The longer a property sits on the market, the greater the gap between the asking price and the sales price.

The key to understanding the market is looking at the market trends. We use a Market Index to put the market into a number that we can compare and track trends. Above 1.20 is a seller's market, between 1.20 and 0.80 is a neutral market, and below 0.80 is a buyer's market. La Canada does have some very different market numbers compared to its neighbors, La Crescenta and Pasadena.

From August (prior to the mortgage industry shift), and December, we see a curious trend. From 0.56 in August (second only to San Marino) , then 0.44 for September , October 0.23, and November 0.18, December 0.12.. Now, December, 2006 had a market index of 0.46. La Canada seems to be headed for a soft landing. Will it go up next month? What will spring market do? In December of 2006 there were 6 new listings added.with a total inventory of 41. In 2007 we saw 14 new listings added (over twice as many), and the inventory climb to 67 listings. That is a 63% increase in listing inventory Not a large number of new listings, and a proportional number being sold, yielding a pretty much flat market index for the past few months..

Data is from iTech MLS. Data is deemed reliable, has not been verified, and is subject to change.

What is important about the relatively constant figures? Even considering the shift in the market, along with the significant changes occurring in the mortgage industry, homes are still selling. If you are a buyer, and are waiting for prices to drop, this may well be the time to start getting serious.

F\or sellers know that buyers are looking for VALUE. Properties that show the best value sell first, leaving the rest of the inventory to sit on the market. Homes that are properly prepared, marketed, and priced, will still sell in under a month. The longer a property sits on the market, the greater the gap between the asking price and the sales price.

For a no-obligation Highest Price Analysis just call 1-888-284-2056 or email Keith@GlencrestTeam.com.