Comparing September 2008 with September 2009, this really is not very alarming other than September 2008 had some very troubling developments. Fannie Mae and Freddie Mac were taken over by the government; AIG, Indy Mac, Lehman, JP Morgan Chase and Merrill Lynch created a panic, yet more homes sold in September 2008 than September 2009. Part of this phenomenon is that the real estate market is not in recovery yet and the other part is that we are in a normal market trend period.
I have been digging around for this chart in my file cabinet and scanned this chart in so you can see how the Simi Valley Housing market moves. The chart below was put together by Lawyer's Title in 2007 and it really shows how sales slow in the fall and winter.
Breaking out the Single Family Detached Sales for Simi Valley shows that there was 22.6% fewer homes sold in September than in August of this year. We still have a way to go to get back to levels over 100 units per month.
What this means in the long run is that it is still a buyers market. The low inventory is helping sellers with less competition, but as we are seeing with a new REO Listing up on Fitzgerald this week, the price is still low even with 20 or more offers.
Simi Valley Market Update YTD through August 2009
More of the same. Sluggish Simi Valley Market results still lag behind last year. The only thing keeping this market alive is the Low Inventory, Low Interest Rates and the $8,000 tax credit which is about to expire. Unemployment for California is expected to peak in December at over 12%. No matter how hard the government, my industry or the news wants to cheerlead us out of the slump and recession, we still have a way to go. Once some real reliable stabilization appears, it will still be a long - almost flat recovery.
So what do you do if you are thinking of Buying or Selling?
If you are Selling you have somewhat of an advantage. The low inventory has created fewer competing homes in Simi Valley. We are moving into the fall which has a very typical pattern of few sales, even lower inventory and the going concern for most Real Estate offices, is that a large percentage of agents stop working till about Superbowl Sunday. As a seller you can take advantage of the low inventory, but a comprehensive plan of exposure for your house is critical. Typical agent marketing at this time of year will not suffice. Additionally, interviewing agents is very important as the real estate industry fall-winter-hibernation could land you with an agent that is in the middle of their hibernation period.
If you are Buying, Buyer Beware! Don't get enticed into a purchase over the $8,000 tax credit. The competition for entry level homes is stiff. Don't get saddled with a home that is loaded with tens of thousands of dollars in deferred maintenance. The credit may not go away, there are people working to extend and broaden the tax credit. Even if the tax credit expires and is not renewed, we will see a good portion of the buyers step back and ease some of the competition which will give the patient Buyer an opportunity to make a less pressured purchase. The homes above the $500,000 mark are providing some very nice opportunities for Buyers looking for a move up. The upper end tends to see homes in better condition and fewer distressed sales. This could all change on the next mortgage rate reset we are about to experience next year as the loans for purchases and refinances for 2005 reset or recast.
I keep a monthly log of the market activities at www.HomeBuysBlog.com where you can go back a search out old reports and see the trends. Follow along as a post each month.
Don't be fooled. Is the Simi Valley Housing Market Really Stabilizing?
I have written a few posts at HomeBuysBlog.com on the situation in the Simi Valley Housing Market. While things look hot, it is neighborhood and price range selective. We are about to witness another example of how people don't learn by the mistakes of others as they chase one of the lowest inventories we have had in years; all for a $8,000 tax credit. When you dig down into the sales and escrows each month several important issues come to light that are diving this market.
What gets lost in translation of Realtor drivel/hype over a seemingly hot market, is that Simi Valley Sales Volume peaked in May and has been lower for the last two consecutive months. Unemployment is going to continue to be a problem for any true housing recovery. On average each month two-thirds of the escrows are SHORT SALES, which most never close escrow, leaving frustrated stranded buyers. For example Simi Valley is averaging 78 single family detached closings per month for 2009. With 265 homes in escrow, there are going to be many disappointed buyers as many of these escrows are distressed sales which will never be approved in the Short Sale process. Simi Valley has averaged under 20 Closed Short Sales per month and there is nothing to change that pace for August of September. Do the math, a real recovery is still a way in the distance.
If you are a buyer, relax, make a smart buy and don't get dragged into an impulse purchase. If you are a Seller or potential Seller, now may be the time to put your home on the market as the inventory is low and the competition in some of the price sectors is low If you are upside down on your home, I have a PSC Short Sale certification and can help you evaluate if your home fits the parameters that will qualify for a short sale. There is no cost for a consultation.
Please make sure to see:
Simi Valley Market Update YTD 7-31-09
Adjustable Mortgage Reset Schedule
Simi Valley Home Sales for June 2009
The above chart is the activity for Simi Valley detached home sales in June 2009. The condo - attached market is reacting differently and should not be included in a market activity report for detached homes. The continuing trend of brisk sales in the low end of the market is no surprise. This trend is very fragile relying on
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Simi Valley Real Estate Specialist Licensed over 12 years, California DRE 01224852. Dedicated to earning your trust and respect long before I ask for your business. Simi Valley homes for Sale.
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