[...] Since Case-Shiller lumps LA and Orange Counties together, I won’t repeat everything I wrote on the LA Sweet Digs blog. For more analysis and some graphs of the LA Case-Shiller data, check out my post over there: Case-Shiller: Signs of Eventual Stabilization in LA Home Prices? [...]

[...] blog. For more analysis and some graphs of the LA Case-Shiller data, check out my post over there: Case-Shiller: Signs of Eventual Stabilization in LA Home Prices? Copyright © 2007The OC Coastal Group Garry Loss htttp://www.theoccoastalgroup.com [...]

Quote: “In November, the year to year decline was 26.9%, compared to October’s 27.9%. This could be the first sign of some kind of price stabilization here in SoCal.”

Unemployment is increasing, banks are getting hit worse everyday with losses and bad performing assets, the economy is shrinking, loans are getting even harder to get, and people have no money to put down and are afraid to spend… and you think this November figure of 26.9% decline is the first sign of a bottom vs. just single month blip in the data?! The economy is in such a mess right now, to use one data point as a sign of stabilization is lunacy.

What I have observed is that every area in LA is different. Some areas were slower to fall and have further to go so the drops there will take longer and may be more significant. Eg. South Bay, El Segundo is showing signs of that. I would guess that Santa Monica and areas that serve Irvine seem likely to be impacted by layoffs in high end companies. Other areas that were grossly overvalued and do not have any redeeming values such as good schools, have fallen dramatically but may slow as investors take up the bargains for rental opportunities. We all know areas that fall under that category. Who knows how badly places like Burbank and Gendale might be hit, by a prolonged actor’s strike?

It makes me smile, when anyone predicts a bottom any time soon. Unless they have a crystal ball, how can they tell? As this point, who knows what the economy, global or otherwise will be like in two months, never mind twelve! There are far too many unknowns right now to even predict two weeks out. When there are unknowns, there is unease. When there is unease, buyers stop buying and prices go lower. There may be a spike or two as “current bargains” (A bargain in Sept 2008 is no longer one now!) are snapped up, but for the most part, “there are too few qualified buyers and far too many houses for sale and will be for some time”. Also if I were to buy now, I’d plan on staying for a while, as I am almost guaranteed to lose in the short term, on price. However, if I see that “sweet digs” and I can really afford it, I will snap it up, as it may not be round for the true bottom. If you are trying to sell now, Good luck. Every sane thing I’ve read stresses to price it at a realistic price and be prepared to go lower. It’s hard emotionally to do this but it makes perfect sense to forget how much you paid for it or put into your home. Realistically, buyers don’t care if you overpaid for or over accessorized your house. One way to see how much your home might be really worth is to check recent sales (this year’s) comps on Redfin and guesstimates on Zillow. Also, I would speculate that everyone is looking for a “bargain” these days and it’s pretty obvious that buyers are in the driving seat. Anyone who does not price right, better be prepared to hold onto their home for a while and will most likely watch their neighbors sell for less and less as the months go by. It’s a very, very hard thing to watch your home go for less than you put into it, but if you need to sell, it makes sense to me to do it quickly while prices are dropping, as you will most likely save yourself a lot of time, money and stress. Remember, even if you do sell for less, you may still be a winner because you got the tax benefit and you lived in a place that is a lot nicer than any rental. Good luck to all buyers and sellers and to quote The Bard, “a plague on you and your house”, if you are a flipper. Only kidding, flippers are people too. Aren’t they?

I agree with Hannah B. Using one data point to suggest stabilization is lunacy. Redfin is like any other real estate agency, trying to get people to buy houses so they can get their commissions. If people think prices are stabilizing they might jump in and not make lower (realistic) offers, keeping commissions higher. Really, you think housing prices are stabilizing given the economy?

I think some of you may have misread the intent of this post. I’m not suggesting that a single month of data is a reliable indicator that the market has bottomed. Note that the headline of the post was a question. I’m just pointing out something I thought was an interesting movement, and attempting to spur some discussion.

Also, I’m merely a contract writer for Redfin, and they don’t tell me what to say. It doesn’t matter to me one way or the other when or if you buy a home.

I definitely DON’T think anyone should “jump in” and not make realistic offers. Definitely not. That’s what got us into this mess in the first place.

[...] Last month I questioned whether a slight slowdown in the rate of year-to-year price drops may be the first sign that home prices are on their way to stabilizing in Los Angeles. Of course, a single month of data is not enough to come to any real conclusions, but it was interesting, nonetheless. [...]

[...] but Las Vegas and Phoenix, but it would appear that November’s data may have indeed been the first sign of an eventual stabilization. However, even if that is the case, the current rate of improvement would put home prices [...]

[...] been six months now since we first pointed out on these pages the sign of a possible bottom on the distant horizon for Los Angeles home prices. Things are [...]

[...] period of relatively strong home price gains. That said, the rate of YOY declines has been dropping since November’s data, so we’re definitely continuing on a trend of moderating [...]