The California Association of Realtors’ latest price report shows local house prices fell 5.4% in November from the year before.
That’s a bigger price decline than the 0.7 percent reported for November by DataQuick, although both indexes reflect similar trends.
CAR pegged the median price of an existing single-family home in Orange County at $661,580, down from $699,200 in November 2006. On Dec. 18, DataQuick reported a median of $655,000 last month for existing single-family homes, down from $659,750 a year earlier.
Both indexes reported sales volume declines from the year before. CAR reported that house sales fell 36.8% in November; DataQuick reported a decrease of 49.1%.
More recent figures from DataQuick showed a slight uptick in house sales during a four-week period that includes the first 10 days of December. See that post HERE.
Here are single-family home median prices for the past 13 months from CAR and from DataQuick:
| Month | CAR | DQ |
|---|---|---|
| Nov-06 | $699,200 | $659,750 |
| Dec-06 | $692,980 | $665,000 |
| Jan-07 | $688,610 | $675,000 |
| Feb-07 | $692,820 | $675,000 |
| Mar-07 | $706,650 | $695,000 |
| Apr-07 | $747,260 | $720,000 |
| May-07 | $714,130 | $695,000 |
| Jun-07 | $723,860 | $734,000 |
| Jul-07 | $709,720 | $718,000 |
| Aug-07 | $710,380 | $710,000 |
| Sep-07 | $673,770 | $655,000 |
| Oct-07 | $673,770 | $650,000 |
| Nov-07 | $661,580 | $655,000 |
My prediction…..
April 08′ will show a 20% decline YOY…perhaps more…due to the comparison with the peak in 07. This is the problem with YOY comparisons on monthly data which has a lot of variance.
29 months of inventory… but prices only came down 5% yeah
and shockg is really donald trump llooll @ribsplitter
What is the total number of units selling by area per month, by type? Is there a link for that? I’ve been watching some areas and see very little actual sales. So if a million dollar house sells it skews the numbers?
By CHRISTOPHER THORNBERG
December 28, 2007
In 2002, the median price of a single-family home in Los Angeles was $270,000 and the median homeowner’s income was $65,000. With a $50,000 down payment, the annual cost of that house (taxes, insurance and payment on a 30-year fixed-rate conventional mortgage) would add up to about 33% of the median household’s income — just under the 35% mark that the Federal Housing Administration calls the upper limit of “affordable.”
By 2006, the cost of that same house doubled, to $540,000 — pushed by unbridled speculation fueled by unparalleled access to mortgage capital. But median income rose a paltry 15%. So today that same set of costs come to 60% of gross income.
That might be a manageable burden when home prices are rising at double-digit rates, creating new equity that can be accessed to support spending — but not when prices are flat and the home-equity ATM is closed.
There are “experts” out there who once preached that there was no bubble; they now preach that all real estate is local and that prices in your neighborhood won’t be affected by foreclosures and price declines elsewhere.
The cold, hard truth is that foreclosures are serving only to hasten the painful process of shifting housing prices back to a level the market can sustain. Prices must and will fall. Everywhere. Probably 25% to 30% from their peak.
2008 is the year when gravity will reassert itself. You should be adjusting your expectations of your home’s value so that it’s correctly aligned with market realities. And when making important financial decisions today, be realistic and factor those declines in.
Christopher Thornberg is a founding partner with Beacon Economics.
Although it seems like a negative prices are still holding steady. It is great time to be looking to buy. With credit getting tighter and the speculators getting kicked out it can’t get any better if you are in a position to buy
This guy nailed it, although you don’t have to be an economist to figure it out - I’m certainly not. I’m a renter (shame) and make 6 figures and if I want to buy a stucco box for $650K I just can’t do it even with 30% down. The property taxes, insurance and maintenance just kill the deal. However, at $400K it’s do-able. I know people will say that I’m dreaming if I think that 30 year old stucco box will ever come back to that price - I personally think they are still over-valued at that - but I am a potential buyer and I just won’t / can’t enter the market until then.
Just one persons situation.
I like Mr. Thornbergs use of “expert”. With a couple of notable exceptions, everytime I listen to an “expert”, I lose money.
Thornberg and some others have been dead on and now the MSM is all over it, re-setting expectations of sellers and giving buyers every reason to think twice before they become a bag holder.
A couple years of really bad sales and now 5%-8% declines even with a skewed median that mask much larger declines that sellers see, make it much worse that reported.
As expected prices are sticky until everyone smells smoke and rushes for the door, 08 will be the year to get out while you can, if you can.
Trs (truthi),
As far as the “ATM Equity Machine” is concerned, it is true that there is more home equity now then previous years mainly due to the current bubble, but it’s also true that more people have tapped out that equity then any other previous time in our history.
It’s also true that home equity is evaporating faster then anytime in our history.
It is wise not count equity from a housing bubble because it is artificial and it will always disappear.
It amazes me to see that there are still people out there delusional enough to think that there was no housing bubble in CA.Guys wake up and smell the roses.This round of hype created by the flow of free money made possible by the super smart guys on the wall Street is finished,and so is a good percentage of paper wealth people were counting on.Let me make it real simple,if you bought your house or investment property before 2002 write down your equity by 20% to 40% depending on the locaton of your property.If you bought your property in 2005 or 2006 and paid market value or even got too excited and paid 5% to 10% over the market value of those years and could keep paying your mortgage,write it off as the life style expense unless you are living in a real dump which in that case use the jingle mail process and add a few hundred thousand dollars to the billions of dollars being written off by the financial institutions.It will be another drop in the bucket and don’t feel really bad about it because this is the way free capitalism works.Those super smart guys made their hundreds of millions of dollars.The decently smart guys who realized in time what was happening made hundreds of thousands and the rest of suckers who realy believed that a 700 sqf shack falling off its foundation in Santa Monica or HB where the median HH income is less than $80000 was really worth $1000000.are going to hold the bag or are going to become the proud contributers of extra drops to the bucket and will spread the loss to the higher tier of the risk takers who bought the garbage of CDO s.But after all don’t despair ,give it another 7 to 10 years and the whole thing is going to repeat again.Well,you know this is CA and a few degrees warmer temp during the winter would justify the 6 hours daily drive in the traffic and spending close to 60% of your hard earned money to provide a roof over your family’ head.
trs said: “some groups praying for a crash are US treasury investors, renters”
BTW, without first time buyers, there can be no move up buyers. And first time buyers were once upon a time renters. Cut the low end of the food chain, and the whole cycle will die. Only elitist myopists would fail to realize that.
Good call Bill - - - - - re:Truthiness.
You beat me to it :)
She brings to life the saying…..”Who you are speaks so loudly I can’t hear what you say.”
Samson good point that shows exacty why they hide behind the median.
I did the pretty much the same thing a few months back when I noticed most of the areas I follow were in fact down 15%, it looked pretty bad. I wonder why simple things like this can’t be done in the reporting, or at least questioned, never mind, I know why.