Archive for August, 2008
August 31, 2008
Note: The stats for detached homes provide a good overview of market trends in each city. However, condos also play a significant role in the Orange County housing market, so taking a look at these numbers is also helpful. That is what we will do with the following housing numbers.
As with yesterday’s post (which was a overview of the statistics for the detached homes market in Irvine), I am switching over to the Redfin’s inventory and pricing tools to help with determining the status of the housing market. So unless otherwise noted, the following numbers are from Redfin’s Irvine “Overview of Homes for Sale” webpage. This page includes the Irvine inventory and pricing numbers as well as the associated charts and graphs. So if you would like to see the charts and graphs, click on the link for the above mentioned overview page.
The following Redfin numbers include MSL-listed, for-sale-by-owner (FSBO), and bank-foreclosure homes. Also, note that the numbers with an asterisk (*) are based on homes sold or taken off the market in last 90 days.
Following are the Irvine condo housing numbers for August 2008. As with the Costa Mesa numbers, I will let you draw your own conclusions concerning the difference between the overall list price and overall selling price as well as the difference between the list price per square foot and the sold price per square foot in Irvine.
Next month we’ll have some numbers for comparison; however, even without these numbers, we can safely say housing price increases are not going to be in Irvine’s near future. Rather, after the recent drop-like-a-rock price declines in Irvine, we currently have the possible scenarios of prices staying in a trough or prices drifting down slowly (IrvineRenter predicts that Irvine housing prices will start dropping when Alt-A and prime loans start resetting). I think that we are currently in scenario 2 (the slow-drift-downward scenario) with the possibility of sharper declines when resetting starts.
- Median List Price:
- Median Sold Price for*:
- Median List Price/SF:
- Median Sold Price/SF*:
- Median Days on Redfin*:
- Total Number of Homes on the Market:
- August 29, 2008: 505 (13 are bank- and MLS-listed foreclosures; 10 are for-sale-by-owner)
- % Homes with Price Reductions/Median Number of Reductions/Median Total % Reduction*:
- August 29, 2008: 43.1%/2/7.7%
*Based on homes sold or taken off market in the last 90 days. These include MSL-listed, for-sale-by-owner, and bank-foreclosure homes.
Also, according to DQ News in July 2008, the number of sales of condo and detached Irvine homes combined was 119. And, according to DQNew, the July median sales price in Irvine was $591,000, down 17.80% from the July 2007 price of $791,000.
And, finally, Refin’s median numbers for all Irvine homes sold in last 90 days are $568K and $378 per square foot. The number of Irvine homes (condo and detached) currently on the market is 939.
For more information on the August Irvine housing numbers, see yesterday’s post “The Irvine Market Report: Detached Home Stats, August 2008.” For a review of the January 2008 to July 2008 Irvine housing numbers, see “The Irvine Market Report: Detached Homes Stats, July 2008” and “Reality Check: Irvine Market Detached+Condo Housing Stats, July 2008.”
August 30, 2008
As with last weeks Costa Mesa market reports and tomorrow’s post (which is a overview of the statistics for the condo housing market in Irvine), I am switching over to the Redfin’s inventory and pricing tools to help with determining the status of the housing market. So unless otherwise noted, the following numbers are from Redfin’s Irvine “Overview of Homes for Sale” webpage.
This page includes the Irvine inventory and pricing numbers as well as the associated charts and graphs. So if you would like to see the charts and graphs, click on the link for the above mentioned overview page. Also, note that the numbers with an asterisk (*) are based on homes sold or taken off the market in last 90 days and include MSL-listed, for-sale-by-owner (FSBO), and bank-foreclosure homes.
For more information on the August Irvine housing numbers, see tomorrow’s post “The Irvine Market Report: Condo Housing Stats, August 2008.” For a review of the January 2008 to July 2008 Irvine housing numbers, see “The Irvine Market Report: Detached Homes Stats, July 2008” and “Reality Check: Irvine Market Detached+Condo Housing Stats, July 2008.”
Following are the 2008 detached home statistics for Irvine. Last month’s detached home numbers for Irvine showed a market that hinted of a upward trend for the detached home market in Irvine. However, this month’s numbers indicate another holding pattern or even downward-pricing trend in this market. The most significant number is the median price per square foot, which went down.
- Median List Sales Price:
On August 29, 2008: $889K
On July 20, 2008: $939,431 (Source: Altos Research)
Note: The Altos August number for this category is higher ($944,957), most likely because Redfin includes FSBO listings and bank-foreclosure properties. However, the median list price per square foot decreased in both Altos and Redfin charts. See below.
- Median Sold Price*:
On August 29: $705K
- Median List Sales Price/Square Foot:
On August 29, 2008: $388
Note: Altos Research has this number at $395**. For more explanation, see above, Median List Sales Price.
On July 20, 2008: $469 (Source: Altos Research)
- Median Sold Price/Square Foot*:
On August 29: $351
- Median Days on Market:
On August 29, 2008: 85*
On July 20, 2008: 109 (Note: This is average days on market, not median days on market. Source: Altos Research)
- Number of Homes on the Market (Inventory):
On August 29, 2008: 436*
On July 20, 2008: 401 (Source: Altos Research)
- % Homes with Price Reductions/Median # Reductions/Median Total % Reduction*:
On August 29, 2008: 46.2%/2/6.2%
- Market Action Index (Source: Altos Research):
On August 24, 2008: 17.28**
On July 20, 2008: 17.00
Note: The Market Action Index shows the balance between potential buyers and sellers, in other words, the balance between supply and demand. Above 30 is a sellers’ market; below 30 is a buyers’ market.
*Based on homes sold or taken off market in the last 90 days. These include MSL-listed, for-sale-by-owner, and bank-foreclosure homes.
**These Altos Research numbers are those that were listed on August 24, 2008.
August 28, 2008
It’s been three months since I last did a real estate market report for Santa Ana. In the last report, I struggled to find good news. I was able to report that the number of days the average house was on the market was down, which could be seen as a good thing. Well, this time around, I’ve got nothing good to report. The forecast is all doom and gloom. Unlike Tustin and some other cities, we’re not seeing any signs of a turnaround for a long while.
Thanks to Altos Research, we see that the median single family home price continues to plummet. The current median price is $378,238, down 15% (from $443,171) in just three months. In looking at Redfin’s new market data page (so cool), we see the median list price for homes is $350k ($185k for condos) while the median sold price is $335k ($172k for condos). With these drastic drops, Santa Ana continues to be the poster child for sub-prime lending gone bad.
Meanwhile, inventory levels and days on the market continue to be on the rise. According to Altos, we’ve now got 1,404 properties on the market (up from 1,222). The average property has been on the market for about 126 days (up from 98 days). So, let’s see, we’ve got more houses on the market, and we’ve got them not moving, just sitting there. Yeah, it doesn’t take a rocket scientist to figure out why the median price is on a roller coaster that only goes down.
Redfin data is showing 1,060 homes and 676 condos on the market, both being on the market for 88 days. The graph below actually shows a decrease in inventory in the last few months. However, the graph does not yet have August included. There’s going to be some variance in the way that Altos counts versus the way Redfin does (FSBOs included/not included, etc.) as well as how the graphs depict the data, but both data sets are telling the same story… not good.
Just when I was seeing a light at the end of the tunnel for the market with Tustin’s median price being up last week, Santa Ana has gone and flipped the switch making it dark and gloomy again. Thanks, thanks a lot Santa Ana.
Inventory (per Redfin)
Median Price and Median Inventory (per Altos Research)
Properties Just Getting Their Feet Wet
1419 W Civic Center Dr, Santa Ana 92703; 1 bed/1 bath; 987 sq ft house; 7,350 sq ft lot; $215,000
2725 W Lingan Ln, Santa Ana 92704; 4 bed/2 bath; 1,426 sq ft house; 5,865 sq ft lot; $237,500
3714 Alder St, Santa Ana 92707; 3 bed/2 bath; 1,321 sq ft house; 6,000 sq ft lot; $427,500
Properties That Are Sinking to the Bottom
519 S Broadway, Santa Ana 92701; 3 bed/2 bath; 1,308 sq ft house; 6,250 sq ft lot; $574,350; 481 days on the market
901 S Cypress Ave, Santa Ana 92701; 3 bed/1 bath; 1,014 sq ft; 7,567 sq ft lot; $300,000; 489 days on the market
821 S Garnsey St, Santa Ana 92701; 3 bed/1 bath; 1,130 sq ft house; 6,175 sq ft lot; $249,900; 595 days on the market
August 28, 2008
Every once in a while (okay more than once in a while) I read something that really just leaves me scratching my head. And this time it was Kiplinger‘s July Newsletter for California. Known for their analysis and market predictions I was really surprised by this newsletter.
After prediciting November elections and the key sway issues they really baffled me with their real estate forecast.
Don’t be misled by the steep decline in California median home prices…40% from July 2007 to July 2008, for example. Chances are goodthat your house hasn’t fallen that much in value during the same time period.
Huh? Now if this were addressed to say, residents of Newport Beach, Laguna or another coastal area that has remained minimally affected (but still affected nonetheless) by this declining market I could see that response, but this was shocking to me. Right now we’re seeing lots of homes selling at prices they sold in 2003/2004 (some even 2002).
The figures are distorted by the huge number of foreclosed houses that are sold by lenders at big discounts to get them off their books. Also by short sales…a troubled borrower making a deal with a lender to get out of an expensive mortgage by selling it at the best price possible.
Right here they were right on – this is a HUGE portion of what’s driving down home prices as far as they are going. However, I don’t think this is really distorting the numbers. The numbers aren’t distorted. Ask seller John Doe who’s trying to sell his house on ABC Street in Anytown in the South OC who’s competing with 3 foreclosures in his neighborhood.
Otherwise, the drop in home values is closer to 10%. It’s bigger than that in severely troubled areas, such as the Central Valley and the Inland Empire. But it’s smaller in strongholds such as Los Angeles and the S.F. Bay Area, where few subprime loans were made and there aren’t many foreclosures.
Looking at some of the posts by our San Fran bloggers, it seems that prices up there have even rolled back to 2004 prices in some areas. Check out some of the evidence of that here. I don’t think 10% is even close to where values are from when prices peaked. Most homeowners who live in South OC and bought between ’05 and ’06 know this and so does our government. They agree so much that home values fell that they reassessed taxes for all those homeowners for far more than a 10% loss – many saw it closer to 25% in Laguna Hills and Mission Viejo.
A side benefit of declining home prices is increased affordability. The percentage of households that have the means to buy an entry-level home has doubled from 24% to 48% during the past year, spurring home sales. You’ll see some slight upticks in median prices early next year, when the inventory of foreclosures and short sales is whittled down.
Honestly I haven’t researched new homebuying enough to understand if this is true or not so I won’t even try to comment on that issue. However, I do have some concerns that the windfall of foreclosures and short sales will not dwindle in the next year as many of the arms that those who did not 100% finance have. Many are set to expire in 2009 & 2010 and we might see another influx of such properties injected into the market.
But the housing market won’t get back to equilibrium until late 2009. That’s when homes will sell more quickly and prices will rise across the board.
And a lot of analysts agree here. But, like my previous comment worries me that we might reach equilibrium to only have it disrupted again by a new and steady influx of foreclosed properties.
August 28, 2008
After months and months of hearing about double-digit price drops, record foreclosures, and stagnant home sales, O.C. residents might be surprised to know that there are places in the U.S. where home prices are actually appreciating.
This report from the Office of Federal Housing Enterprise Oversight notes that housing-market extremes are most pronounced in California and Florida, but almost everywhere else, price drops are far more modest.
U.S. home prices fell in the second quarter of 2008, according to OFHEO’s seasonally-adjusted purchase-only house price index.
The index, which is based on data from home sales, was 1.4 percent lower on a seasonally-adjusted basis in the second quarter than in the first quarter. This decline was less steep than the 1.7 percent decline in the prior quarter.
Over the past year, prices fell 4.8 percent between the second quarter of 2007 and the second quarter of 2008. The decline is the largest in the purchase-only index’s 17-year history, but is much smaller than those of other indexes.
Translation: U.S. home prices are still dropping, but more slowly than in previous quarters.
Of the 20 ranked cities with the greatest price declines over the last four quarters, all but one (Las Vegas-Paradise, Nevada) were in California or Florida.
Orange County’s price decline of 15.32% wasn’t the worst in the country. That honor belongs to Merced (down 34.5%), followed by Stockton (-31.7%) and Modesto (-28.5%).
Where can you go to find a house that might do what we were led to believe houses always do — appreciate steadily every year? Here are the hot locales.
Market Area /Yearly Appreciation
Houma-Bayou Cane-Thibodaux, LA: 9.06
Decatur, AL: 6.44
Charleston, WV: 5.99
Greenville-Mouldin-Easley, SC: 5.78
Idaho Falls, ID: 5.27
Grand Junction, CO: 5.25
Charlotte-Gastonia-Concord, NC-SC: 5.24
Austin-Round Rock, TX: 4.98
Fayetteville, NC: 4.97
Tulsa, OK: 4.87
Recent Redfin posts:
The Costa Mesa Market Report: Detached Home Stats, August 2008
“Truth and Roses Have Thorns About Them”
Orange: Condos Under $200K
August 27, 2008
“IrvineRenter” over at the Irvine Housing Blog (excellent blog if you’re interested in Irvine or just want a good read) posted a clever little post called “Columbus Lost” yesterday. The post compares Christopher Columbus’ voyage and his “difficulty getting crewmen to serve because they believed the world was flat, and if they sailed far enough, they would fall off” to a myth about real estate that prices always goes up and will never “fall off” (as seen case in point in Columbus Grove).
This comparison of inverse myths got a little chuckle out of me. After hundreds of years, people are still behaving foolishly and going on popular opinion versus scientific research and trends. In Columbus’ time, there was science to support a round earth (stars seen in one region, but not others; the way the sun set; etc.). In our time, there was science to support the idea of a housing bubble and prices going up and up, to only fall and fall thereafter (just look at data from the early ’90s).
IrvineRenter comments on the buyers of Columbus Grove who bought at the peak had their resale values pushed “off the edge of the flat earth.” IrvineRenter continues “… the rate of decline is largely dependent upon the amount of must-sell inventory in specific areas. So far, the areas that have fallen the quickest have been those with large percentages of subprime loans (Santa Ana,) large numbers of new homes (Columbus Grove,) or both (Riverside County).” An interesting depiction of the trouble areas. Of course, in the long run, though, Columbus Grove has a higher likelihood of being able to bounce back given it’s prime (not sub-prime!) location, schools, and new development.
Interestingly enough, though, there are a quite of few homes in the Villages of Columbus that are selling for more than what was paid. Just look in Columbus Square (especially near this home). Whether they will sell or not is another question… my feeling is that they’re overpriced. However, those homes are not painting a picture of heightened trouble in comparison to surrounding neighborhoods. Also, these homes did sell later when the market was already falling, so the previous purchase price may already be reflecting a drop.
Regardless, many Columbus resale homes are telling one story… a “yikes! get me out of this mess!” one. These homes do hint to the idea of new developments being a target for accelerated decline.
428 Hudson Dr, Tustin 92782; 4 bed/4 bath; 2,302 sq ft house; $729,900 (down 9.6% from last sale of $806,500)
1494 Voyager Dr, Tustin 92782; 5 bed/4 bath; 3,088 sq ft house; $850,000 (down 13.7% from last sale of $985,000)
78 Liberty St, Tustin 92782; 3 bed/3 bath; 1,400 sq ft condo; $499,000 (down 16.2% from last sale of $596,000)
661 Loran Way, Tustin 92782; 4 bed/5 bath; 3,118 sq ft house; $849,000 (down 26.2% from last sale of $1,150,500)
August 26, 2008
If you are like my husband and I were when we were buying our first place, it was sinara to the dream house and hello affordable condo. In perusing this week’s price reductions and new listings, I came across a few condos that would appeal to those “budget-minded” folks. Thanks to this market, there are some great deal on condos… only in this market can you get three bedrooms for under $200k.
555 S La Veta Park Cir #234, Orange 92868; 1 bed/1 bath; 599 sq ft; La Veta Monterey Condos; $139,900; recently reduced from $144,900 (original price $154,900)
123 S Cross Creek Rd #F, Orange 92869; 1 bed/1 bath; 738 sq ft; $175,000; reduced from $195,000 (original price $297,000)
1800 E Heim Ave #34, Orange 92865; 2 bed/1 bath; 907 sq ft; $179,900; reduced from original price $189,900
3139 E Chapman Ave #1b, Orange 92869; 2 bed/2 bath; 1,022 sq ft; $185,000 (original price $219,000)
3139 E Chapman Ave #18c, Orange 92869; 3 bed/2 bath; 1,184 sq ft; $199,900; just reduced from $218,500 (original price $269,900)
855 N Lemon St #1, Orange 92867; 2 bed/2 bath; 1,062 sq ft; $199,900; just listed
August 26, 2008
This weekend, Jon Lansner of the O.C. Register’s Lansner on Real Estate blog wrote a column in which he posed the question: Would a homebuyer be better off opting for an O.C. condo or a Riverside County house?
Thanks to a sharp reversal of pricing in Riverside County – far worse than Orange County’s slide – the percentage-point savings for a typical buyer who chooses Riverside has reached a nine-year high, according to DataQuick.
In June, DataQuick said the median selling price of a Riverside detached house was at $275,000 – that was 28 percent cheaper (or $81,000) than an Orange County condo at $366,000. Last month, the Riverside discount remained high at 22.7 percent, or $76,500.
Lansner’s point is that living in Riverside makes more economic sense than at any time in the last decade or so. But should finances be your only consideration?
Let’s be honest here. Riverside County’s true lure – other than skin-frying windstorms, of course – is cheap housing.
I feel I’m qualified to weigh in here, because I lived in Riverside for 15 years. And in that time, I cannot recall a single “skin-frying windstorm.” Oppressive heat, yes; throat-searing smog, sure. But no windstorms.
I also don’t agree that Riverside County’s only redeeming point is cheap housing. Riverside, for example, has a nice historic downtown and hotel (The Mission Inn, right), a college (UC Riverside), and some nice restaurants and decent public schools.
That being said, I probably would not have chosen Riverside as a place to live unless I worked there, which I did. To me, the decision about whether to buy in RivCo or the O.C. comes down to where you work.
There is NO WAY I would buy a RivCo house if I worked in Orange County. Not even in Corona. The only exception would be if I worked the graveyard shift and never had to deal with the 91. No house is worth the headache, the hassle, and the wasted time of sitting for hours on a freeway every day.
Life is short. If you work in Orange County, live in Orange County. Enjoy the fresh air and the amenities, even if you have to live in a smaller place. You won’t miss cleaning all those extra bathrooms.
But judging from the gridlock on the 91, there are plenty out there who disagree.
Recent Redfin posts:
The Costa Mesa Housing Report: Condo Housing Stats, August 2008
“Truths and Roses Have Thorns About Them”
Tustin Real Estate Market Report: Median Price is Up!
An Interview with a Stager
August 25, 2008
“Truths and roses have thorns about them” - Henry David Thoreau
This morning I return back to the working world as summer ends and classes begin at the local college I teach at. My favorite part of the day comes when I explain the attendance policy I have in my class. You can roll your eyes now, my students all do. Of the many reasons I have this policy (namely it’s PUBLIC speaking and if no one comes there is no public to speak to), I explain that it is the civic responsibility of every student to be there.
You see, in California our colleges are heavily subsidized by the state through your tax dollars. And I don’t know about you, but if I’m footing the bill for 19 year-old Johnny B. Goode, he better be hitting the books when the teacher I financed shows up rather than hitting the waves down at Salt Creek.
In the same way, Mission Viejo residents are scrutinizing how some of their hard-earned tax dollars are being spent these days. Last week the City of Mission Viejo announced it’s plans to enter a float in the Rose Bowl Parade. According to the OC Register, about $300,000 have been aside for this project.
The city claims that this is a community building project – for the unity it will provide in having a group of residents to come together and build this float. The mayor claims, “”We believe this is a good community builder. It’s another example of what we try to do in pulling the community together. We have family events we offer all year round, it’s just another example of how Mission Viejo is family and community-oriented.” There are also thoughts that this is a great wide to gain some national attention for the city – kind of an advertisement about Mission Viejo to a national audience.
I don’t know about you but I could think of many other ways to better spend over a quarter of a million dollars. The city could put on a series of concerts for families if they want community building, or organize a community clean up day for the local roadsides and still have tons of money leftover.
Boasting no theme parks, major hotel zones, resorts, and the beach being a good distance away it seems that this probably won’t fall under the “tourism” advertising budget. Is this a good idea for Mission Viejo – particularly when faced with such tough economic times? Let me know!
August 24, 2008
Note: This month I will start using Redfin’s inventory and pricing tools to help with determining the status of the housing market. So unless otherwise noted, the following numbers are from Redfin’s Costa Mesa “Overview of Homes for Sale” page. This page includes the Costa Mesa inventory and pricing numbers as well as the associated charts and graphs. So if you would like to see the charts and graphs, click on the above mentioned overview page link. Also, note that the numbers with an asterisk (*) are based on homes sold or taken off the market in last 90 days.
For more information on the August Costa Mesa housing numbers, see yesterday’s post “The Costa Mesa Market Report: Condo Housing Stats, August 2008.” For a review of the January 2008 to July 2008 Costa Mesa housing numbers, see “The Costa Mesa Market Report: Detached Homes Stats, July 2008” and “Reality Check: Costa Mesa Detached & Condo Homes Stats, July 2008.”
Following are the 2008 detached home statistics for Costa Mesa. The August detached home stats for Costa Mesa are similar to last month’s stats: the housing numbers are still declining slightly in the buyers’ favor. In other words, there is no housing market turnaround in Costa Mesa at this time.
- Median List Sales Price:
- August 21, 2008: $667K
- July 06, 2008: $682,521 (Source: Altos Research)
- Median List Price Per Square Foot:
- August 21, 2008: $377
- July 06, 2008: $380 (Source: Altos Research)
- Median Sold Price/Per Square Foot*:
- Days on Market:
- August 21, 2008: 88—median DOM, source: Redfin* (average DOM according to Altos is 122)
- July 06, 2008: 94 (average DOM, source: Altos Research)
- Number of Homes on the Market (Inventory):
- August 21, 2008: 340 (13 are bank- and MLS-foreclosures; 6 are for sale by owner)
- July 06, 2008: 305 (Source: Altos Research)
- % Homes with Price Reductions/Median # of Reductions/Median % Reduction*:
- August 21, 2008: 53%/2/8.5%
Note: The Altos Market Action Index shows the balance between potential buyers and sellers, in other words,
the balance between supply and demand. Above 30 is a sellers’ market; below 30 is a buyers’ market.
