The California Association of Realtors reports that Orange County’s supply of houses for sale rose in January to an all-time high of 33.4 months, equivalent to requiring 2.8 years to sell all the existing single-family homes on the market at the start of the year.
February and March figures haven’t been compiled for O.C. yet, the association said. Statewide, the supply of house listings peaked in January at 16.8 months, then declined to 14.3 months in February and 11.6 months in March.
The association’s inventory estimate is determined by dividing the total number of houses in the multiple listing service by total sales that month. The resulting figure is the theoretical time it would take to sell all the homes at the current sales pace. (Fresher data from show inventory improvement. CLICK HERE!)
Meanwhile, last month’s median house price fell in Orange County to $591,540, down by 16.3% (the largest percentage drop in the state association’s records). That’s also down nearly 21% off from the peak median price ($747,260) for an O.C. house set in April 2007. The number of houses sold last month fell 36.6% from March 2007.
Statewide, the median price — or price at the midpoint of all sales –was $413,980, down 29% from March 2007, the association reported. Sales fell 24.5% to an annualized, seasonally adjusted rate of 318,830 homes a year.
Here are the March median home prices and sales changes for Orange County and other metro areas in the region:
| Area | Median Price | Price vs. ‘07 | Sales vs. ‘07 |
|---|---|---|---|
| O.C. | $591,460 | -16.3% | -36.6% |
| L.A. | $431,950 | -25.6% | -37.6% |
| Palm Springs | $311,540 | -20.1% | -27.1% |
| Inland Empire | $276,630 | -29.8% | -3.9% |
| San Diego | $447,500 | -26.1% | -29.9% |
| Ventura | $504,210 | -25.0% | -38.5% |
Something here does not compute. OC has been clipping along at about 1400 sales per month, a paltry total. There are 15,000 homes on the market…roughly. What are we missing here? 2.8 years? That number is total garbage.
mully: reality is not total garbage, it is what it is. why must you battle with it?
Shiny, just going by lansners numbers for, oh i dont know, about a year or so now. Always been about 1400 per month, and the amount of available inventory has been around 15,000-17,000. The numbers just do not add up.
LOL, LMAO…..
for sellers who are not a bank………
turn the lights down low……… back the cinnamon cookies…… play the soft music……… make sure everything is tidy top to bottom…….. and then wait 2.8 years LMAO……. LOL@ribsplitter
mully: Lansner didn’t come up with those numbers, the “California Association of Realtors” did. If anything, I would guess the true numbers are much worse given the source.
As I said to on this blog a while back, I believe in being optimistic, the good ol’ saying the glass is half-full vs half-empty and whatnot. But the glass is empty this time, it really is. Indeed, you need negative numbers to say how much water the glass is holding now. But to each his own, if you think the emperor is wearing clothes… Like they say, you can lead a horse to water but you can’t make him drink and so goes the sad plight of our permabulls.
Wow talk about chasing the market down!
55 Dartmouth LN Coto De Caza, CA 92679
Listing Price History
Oct 02, 2007 $850,000
Oct 31, 2007 $800,000
Nov 08, 2007 $790,000
Nov 13, 2007 $775,000
Nov 21, 2007 $749,000
Nov 27, 2007 $724,900
Dec 08, 2007 $714,900
Jan 03, 2008 $689,900
Jan 16, 2008 $669,000
Jan 18, 2008 $599,900
Jan 19, 2008 $550,000
Feb 13, 2008 $614,900
Mar 21, 2008 $615,000
Mar 28, 2008 $599,000
Apr 08, 2008 $569,000
Apr 10, 2008 $549,000
Apr 16, 2008 $560,000
Everytime we get a little good news like the Steve Thomas report, I swear its followed up by much more bad news to the contrary. The news is still to the downside and seems to continue to get worse.
We have a ways to go as the market is forced to adjust.
This means it’s the bottom, right? This time, right? Or was that last week? Steve Thomas says things are turning around, right? Or was that last week?
My watch is broken, and it was right twice today. I am sure the bottom callers will be right at least once this decade … or next.
Hey, all you rocket scientists: this is data from January!
uh oh…there is “mulliganful” posting at the same time…damn where is rants when you need him…cannot post at the same time if we are the same person…right pdu? hehehe…love blowing that theory of yours right out of the water.
Mulli, the CAR number assumes a lot, including that inventory will pile up at a particular rate. The assume little progress in chipping away at inventory, which is a fatal flaw.
Thoughtful…I agree with you…I am sure that is a shock to the “permailovebadnewsbears.” I think it is irresponsible to for Lansner to put these outlandish numbers from 3 months ago as an indicator as to what is happening. I think the YOY numbers for April will be an improvement. Only time will tell.
Bubbs, was that another RE ad for Remax on your site? You have no shame do you…
Come on folks. While the numbers may be from January, homes have hardly been flying off the shelves in the meantime. Even with some improvement if any there has been, where does that leave us if the above stats are accurate? 2.2 years supply? If so, I guess everything is now fine and dandy.
Starting in 06, I am not sure if the curve is parabolic or exponential………..but it doesn’t look good for people trying to sell homes, or the people in the real estate industry that depend on home sales for income….
Mulligan,
Not hard to post different posts at the same time.
Is it? :))
It makes total sense that in the last three weeks YoY numbers have rocketed from -42% to positive territory. Not.
The numbers would be outlandish if they weren’t true!
“worst is over”..”bottom is here”..whatever you say Watts…hahahahhaha
Look kids, it’s simple…SUPPLY and DEMAND = PRICE
# Thoughtful Says:
“September 2001 median = $300,000
April 2008 median = $502,500
Difference = $202,500
Percentage increase = 67.5%”
# Thoughtful Says:
“And the “median”? Still a joke. Anyone who is FOOLISH enough to hang their hat on a median at this time is a numbskull!”
—
Consistency?
Thoughtful, you speak out both sides …. spewing contradicting positions.
Maybe just to incite?
That might be giving you more credit than due.
You won’t respond to this, because it would require that you think.
The above figures are for the entire state. Here, to refresh your memories, is what Steven Thomas posted about 2 weeks ago - FAR more up to date than CAR’s figures:
If you listen to or read all the recent reports regarding “sold” statistics for March, one would quickly come to the conclusion that the real estate market is continuing to sputter along at a slow pace. However, this could not be further from the truth. Sold activity is a snapshot of the past, about a month and a half in the past to be precise. So, March “sold” statistics are really a snapshot of the second half of January through the first half of February. The market did improve during that time but was still extremely anemic as demand, a snapshot of the prior 30 days of escrow activity, grew from 989 escrows in mid-January to 1,630 escrows in mid-February, a gain of 641 escrows. Since then demand has continuously grown to its current height of 2,374 escrows. Last year at this time demand was at 1,925 escrows, 449 fewer than today. This recent escrow activity will translate to sold data reported in the months to come. The big story will be that the year over year sold statistics will be better for the first time since the Autumn of 2005. Demand already crossed that threshold two weeks ago. Some skeptics attempt to discount the uptick in demand, claiming that many will fall out of escrow. That is simply not statistically true. The data does not support their claim. Yes, some escrows do fall out; however, the snapshot of 30 day escrow activity misses some escrows that have already closed because they were less than 30 day escrows. The average escrow is about 45 days, but we do have one, two and three week escrows that won’t show up in the data for long. So, the less than 30 day escrows offset most escrows that fall out. The bottom line: the market is improving. Market time has dropped from 15.6 months at the beginning of the year to 6.55 months today, not as deep of a buyer’s market. The active inventory has not changed much this year and has actually dropped by 61 homes over the past month.
Is was then, and will continue to be, good news for Orange County - ESPECIALLY when the YOY figures, for each month for the rest of the year show higher numbers of CLOSED escrows, every month.
The bottom is here. There’s no need to panic - prices aren’t going up much, anytime soon - they’re just not going down any more this year. I’ve been accurately telling you this since about Feb 1st.
Don’t forget the phantom inventory. The stuff that needs to sell in the near future, but is not yet on the MLS. Many people and banks took those homes off until the spring selling season. Expect inventory to explode very soon This is getting scary, and I’m a housing bear. I should be enjoying this, but I never thought it would be this bad, this fast. . Very, Very Scary. It’s coming!
2.8 years of supply– I demand a recount
wheres steve thomas get him on the phone–
this is just another ploy by the bleeding heart
liberal media to spew negative propaganda–
anything to sell newspapers right blogger
well I for one will not stand for it anymore
as of today I’m cancelling my subscription
to the register
blackbox Says:
April 25th, 2008 at 10:52 pm
Don’t forget the phantom inventory. The stuff that needs to sell in the near future, but is not yet on the MLS. Many people and banks took those homes off until the spring selling season. Expect inventory to explode very soon This is getting scary, and I’m a housing bear. I should be enjoying this, but I never thought it would be this bad, this fast. . Very, Very Scary. It’s coming!
Gimme a break. We are almost in May. Don’t you think the people who were planning on listing in the spring have already listed? What are they waiting for?? Face it. Inventory is flat and will be falling by the summer. The recent inventory trend is not your friend. And you don’t need to quote the YOY Inventory. That is old news. Look at the Month to month trend from the begining of the credit crunch to now.
pdu, I used those median numbers to show that Lee’s claim of a “250% increase” was a fantasy. This blog is so funny!
Sorry to double up. Strange software here.
Hey Truthiness,
Did you read Jon’s column today? Check the last sentence of the last paragraph.
Even he knows you need lithium. Seek help NOW.
What is the math they usually use? Over 8 month supply= downward pressure on prices? What does 2 years mean? I bet nobody wants to figure that one out!
I said it before, I will say it again. Housing cycles start on the east coast and work their way west. Always have, always will. They start their rise in Boston and New York, and then follow west. When prices bust, it starts in the same place and works west. Housing prices are now dropping full force in the West. States like California, Nevada, and Arizona are really just beginning their crash. And since land availability and speculation drove prices higher out here, they will now drop faster and farther. I’m not surprised by these inventory numbers. And the great OC is NOT immune. Life here isn’t all that wonderful.
Whew…thank pdu…glad you can get two windows going simultaneously and post 2 entries at the same time. Wait…am I thoughtful here or mulli…this is SOOO confusing. I love your conspiracy theory…truly entertaining. BTW, thoughtful is hammering you guys when you go at him, I mean me, on a daily basis. The ref would have stopped it a long time ago.
coco…these are numbers from January! We are almost in May…this report is completely baseless and void of any useful information whatsoever. Our inventory on a monthly basis has been around 15,000 for the entire county, with about 1300-1500 sales monthly, a paltry figure based on history. It is only due to the credit crunch, and once that works itself out, sales should return to normal levels. Growth in values will be slow for the near future. I missed the part of Manhattan RE slumping…
Who wrote the numbers above are state numbers? The title specifically states: “O.C. home listings opened ‘08 at 2.8-year supply”
Also, I beleive it was Thoughtful that stated several times that median price for SFR in OC is down only 3% from peak to trough? Are you kidding me? I may not have it fully correct - but that 3% keeps ringing in my head as being quite funny.
As for sales volume numbers: I read what the bulls stated here and the numbers released for the same month do not jive.
I also have read some bulls state that the bottom is here - is that bottom in pricing only? Do you have any professional/expert opinions you can quote to back up your claims? People that are noteworthy of course that have not been wrong recently?
What about job numbers? What about rates?
As for stating OC prices are not dropping any further - you have got to be kidding me. You absolutely have no proof and as a matter of fact, prices are still coming down. Where in the world is the proof that prices have stopped coming down. The proof that they are still declining comes from agents themselves - which everyone should be doing - discussing with agents - pick a few homes in an area you’re interested in - do your research - look at comps. HOMES ARE NOT SELLING FOR WHAT RECENT COMPS SOLD AT - THEY ARE SELLING FOR LESS!!!
All this BS talk above is quite frustrating to read.
It is time however, to put in those low-ball offers. Sellers are accepting them - you just need to submit them. You’d be surprised as to some of the deals we’ve been seeing.
Like I said before, the bulls comments here are very similar to those stated months ago - all turned out to be untrue. But they still come back to spew their incredible jibberish. Shockg’s comments that inventory will no longer increase - hmmmmm - I wonder if he/she will concede if this turns out to be untrue in the coming months.
Note how bears do not need to predict anything at this point - almost every headline is negative in nature based on data. The bulls, however, are throwing every prediction out there - none of which will be conceded when proven wrong. Even those in the public eye - stating that the time to buy was last summer - don’t these so-called professionals have any self-respect and dignity to note when they are wrong?
Its all about risk threshold and don’t allow the bulls on this blog to muddy the water for you to determine if now is a good time to buy for you. These guys are desparate - in one way or another - they are absolutely desparate. I come back to this blog maybe three to four times a week - just to see the same folks spewing the same garbage on an almost hourly basis. Just about everything they state is speculative, unfounded and will soon be proven wrong again. The best part - not one will concede when it occurs - they’ll just change their handle and start over again.
NBI,
We have never had a 2.8 year supply of housing here…for you to believe this ridiculous headline tells me people are sheeple. You know what our inventory has been…you know the monthly sales numbers…do some math kid. Geez…how gullible are you?
Gee, whodathunkit, another error-filled and long-winded rant from not buying it. Nooooo, the headlines are NOT all negative. And yesssssssssss, new sfr’s are off 3% YOY. Live with it!
And shockg appears to be CORRECT in his assessment that seller’s haven’t flooded the market as expected. Geesh, the nerve.
For what their worth the median and inventory numbers look pretty bad but do tell a story, it just depends on which one you choose hear.
From the street for most of us living a regular life in the OC things look pretty bad and its been a hard adjustment.
Just try listing your house against the current market for last years price and you will be out sized, out classed, out priced and over looked.
Finding a willing buyer who has what it takes is another problem that both sellers and lenders are faced with.
Who are they, where are they and why won’t they buy, ‘yet’.
Here is a more accurate depiction from the link above which tell you for more current data…”click here”: since none of you bothered to click, here is what you will find:
Listings Pend Mths 2wksago 1yrago
All O.C. 15,556 2,374 6.55 6.77 7.75
So, it is 2.8 years huh…..Puhleeeeeeze. Seriously, CAR sounds like they are “under-promising” and over-delivering. For the bear-soup out there, if you are actually believing this nonsense, may I suggest the services of a psychologist may be in order.
I am wondering just how silly it must seem to think anyone actually believed that we had 3 years of inventory sitting on the ground.
beckoreilly Says:
“April 26th, 2008 at 12:27 pm
I am wondering just how silly it must seem to think anyone actually believed that we had 3 years of inventory sitting on the ground.”
As crazy to believe in the sustainability of $600K pricetags for OC houses.
tidings:
I have actually seen price sustainability in a few areas. Not increases, but not decreases either over the past 3 or 4 months.
beckoreilly Says:
April 26th, 2008 at 12:48 pm
tidings:
“I have actually seen price sustainability in a few areas. Not increases, but not decreases either over the past 3 or 4 months.”
In other words, they’re the exception to the rule. I would expect to see high prices in a few select cities, but absolutely not all of OC.
Hey beck,
Are you a realtor? Do you have a website I could check out?
This was in Mission Viejo tidings. Not exactly where people are clamoring for ownership like LB, NB, etc. Just an avg. OC community with good schools, a pleasant climate, and a safe place to raise a family.
beckoreilly Says:
April 26th, 2008 at 1:08 pm
“This was in Mission Viejo tidings. Not exactly where people are clamoring for ownership like LB, NB, etc. Just an avg. OC community with good schools, a pleasant climate, and a safe place to raise a family.”
According to zip realty, the median household income was $75K in 2007. But the median price was $700K. I’m glad that Mission Viejo is NOT OC.
beckoreilly Says:
April 26th, 2008 at 1:08 pm
“This was in Mission Viejo tidings. Not exactly where people are clamoring for ownership like LB, NB, etc. Just an avg. OC community with good schools, a pleasant climate, and a safe place to raise a family.”
According to zip realty, the median household income was $75K in 2007. But the median price was $700K. Those numbers are far above the OC median and not representative of the county as a whole.
all you bears, or communists, have a problem. problem is you could have afforded it in 99. but you rented. you could of afforded it in 02. but you rented. now you will always be renting. you missed the ship. my newport bayshores home went from $800,000 to $2,250,000 in eight years. my payment after taxes is only $3,500 per month. i can walk to the bay in three minutes. when i paid $800,000 many people told me how stupid i was to purchase such an overpriced house. please stop venting your communist viewpoint on this site. your fundamental argument is wrong. that is why you will always be renting.
Psst….trs…do you have a buyer ready to pay $2.2M? Betcha you don’t.
This is H I L A R I O U S !
All of the discussions I have posted about various supply calculations need to be reviewed by each of you. As I have written many times, the most important issue is the LENGTH OF THE PERIOD OF TIME USED TO MEASURE ABSORPTION. CAR’s use of a single month’s absorption during what has been the slowest period of sales IN HISTORY is what makes this result ridiculous.
What is even funnier, is that you take issue with Steven Thomas’ numbers (currently at about 8 months’ supply as I recall) and FULLY support CAR’s mathematical result because it fits your crash agenda.
I continue to study inventory levels and publish them for the benefit of my clients. Using my methods, inventory currently exceeds that as reported by Steven Thomas, but comes nowhere near 2.8 years. I know…..let’s use last Thursday as the absorption period, shall we? OH MY GAWDDDD! Inventory is actually 361 years, 5 months and 2.3 weeks! High enough for you? Probably not.
Why Steven Thomas continues to post his results here and take what you all dish is beyond me. While you continue to cheer for the coming crash that will have sellers paying you to take their ocean front mansions off of their hands, plenty of people are selling, buying and enjoying their real estate holdings. For example, I am in my backyard pool, surrounded by rolling green hills, enjoying this warm weekend, with very few worries.
I wish very few worries for each of you. Have a great day!
Excellent post, Pat. Thanks for sharing your expertise. Many of us respect you.
Pat,
Right now it’s too difficult to predict months or years of supply.
There are too many unknown variables.
The entire housing market is in complete shambles resulting in record low sales volumes and record high inventory.
Then add the record amount of loans still resetting and the supply could take a drastic bounce at the blink of an eye, changing the margins by an uncalculated amount.
As for everyone in here cheering on the crash…..a return to a normal housing market is what most everybody here is cheering for.
This bubble has caused enormous problems for everyone.
This bubble has left destruction in its path;
All Time Low Affordability
A Collapsed Economy with Future High Unemployment
Out of Control Inflation
Record Defaults
Record Foreclosures
Record Bankruptcies
The quicker this bubble pops the quicker people can start rebuilding their lives.
no thoughtless its only the blind sheep permabulls that
respect pat why the hell would someone come onto this
blog and brag about sitting by their pool while the vast
majority of the middle class in our country are scraping to
make ends pats nothing more than an overpaid arrogant
clueless dweeb nothing more
Maybe Pat considers HIMSELF to be a part of that middle class. Maybe THAT is his point!
Pat the only thing HILARIOUS is your post
unlike all the rest of the human race pat
HAS NO WORRIES NONE thats amazing
can anyone on this blog name one person
that they know of who has NO WORRIES
just another blatant lie from our resident
real man of inventory genius
Rants, I just can’t get over the stunning hypocrisy you have demonstrated here today. Calling out Pat as bragging while others suffer just leaves me astounded. This blog is nothing more than a daily orgy of celebration of suffering. You have earned a special place in h3ll with this new low (even for you), where you will be greeted by Lucifer himself and installed in a place of honor at his right knee.
BuyHousesNow
you are so so out of touch. each month a couple houses sell around me. yes, are slow. however, sales at $2,250,000 do happen. i could sell my house in nine months if i listed it. fact. i am a normal guy that only makes $250,000 a year. i am a millionaire from the smart purchase of a newport home. fact.
trs Says:
April 26th, 2008 at 3:40 pm
all you bears, or communists, have a problem. problem is you could have afforded it in 99. but you rented. you could of afforded it in 02. but you rented. now you will always be renting. you missed the ship.”
Don’t forget to taunt those who were born too late. Now, they’ve missed the ship and will never be able to own in OC. BTW, I’m betting that you typed your post using a communist-made keyboard and a communist-made monitor. We’re all communist collaborators!
if trs makes 250k a year Im donald trump
lol @ everybody…
Interesting, Pat.
Interesting yet not very informative.
What period of time for inventory absorption do you “chose” to use?
You state inventory currently exceeds that as reported by Steve Thomas, but less than 2.8 years supply, based on your “absorption rate”.
It’s gobblygook — you are saying nothing.
You say:
“I continue to study inventory levels and publish them for the benefit of my clients.”
What does THAT mean? Nothing. You study them. You publish them. For whose benefit?
I’m sorry, Pat, I know nothing of you, but your post appears to be a weak attempt at venting.
Be a man. Man-up, and tell us how much your pool home has dropped in value in the last 3 years. Tell us when you anticipated that, and exactly where and when you projected the market conditions we face today.
Anybody can “study inventory levels and publish them”.
I feel that Bill put more thought and less emotion into his post than you did. He showed a little more class too.
Comments like this only help to make you seem interchangeable with the likes of “Thoughtful and Shockg, et.al.:
“While you continue to cheer for the coming crash that will have sellers paying you to take their ocean front mansions off of their hands….”
………..in fact, sometime back it was speculated on this blog that some of those posters (Thoughful, Shockg, etc) might actually be you. That’s strange.
It is also very strange that you would use the same caustic comments they have — nearly identical.
Not very professional, my man. I hope it was an impostor using your name.
Bill said it much better; I support him here and feel he has a better handle on the situation than you:
“As for everyone in here cheering on the crash…..a return to a normal housing market is what most everybody here is cheering for.”
Why is this a difficult concept for you?
Pat,
I try to engage in a civil discussion with you and all you can do is play games taunting others.
I hate to burst your bubble, but your not the only person in here with a pool home.
In fact, your not the only person within 30 miles (Brea) from the beach with a pool home.
Do you know Brea borders Diamond Bar?
Do you know that Diamond Bar is the headquarters for AQMD?
The Air Quality Management District chose this location due to the fact that Diamond Bar is ground zero for the worst smog in the basin.
So, before you invite rants or anyone else over for a dip, you might want to warn them of the health dangers first.
Cheers!
Oh, no you didn’t.
“The median household income in Orange County jumped 5.5 percent to $75,537 in 2006, the state Franchise Tax Board says.”
VERY interesting! And that’s the MEDIAN, which includes the 40%+ of renters in OC. This median is also ACROSS the county. Whadyathink the numbers are for homeowners in the top 50% of towns? And a 5.5% growth rate to boot! Dayum.
Good morning sunshine
Yeah, I read the median income report right after I read Jon’s “Mortgage Bankers Association says loan applications dropped 14.2% last week”
I guess the median income increase isn’t helping much, is it?
poor Troughless
still does not understand that prices 5 X median income does not make the median house affordable to someone with a median income.
well it makes sense since she probably bought at 10 X income
mav,
She also doesn’t get that the median income for 2006 still included huge broker and realtor wages from liar loans and interest only loans that are non existent now.
Those people are dead broke today.
“still does not understand that prices 5 X median income does not make the median house affordable to someone with a median income.”
Of course not! That has NEVER been the case in Orange County barring a real estate COLLAPSE!
“She also doesn’t get that the median income for 2006 still included huge broker and realtor wages from liar loans and interest only loans that are non existent now.”
Nonsense! Business was abysmal in 2006.
Uh, Bill: those loans are still chugging along. Get used to IO, it’s the future. You and your NONSENSE!
trs–you’re a paper millionaire based on an inflated asset. Do you think it is historically normal for homes anywhere to go up 300% (per your case) in a decade? There were lots of dotcom stockholder paper millionaires who forgot to sell early.
Personally I bought on the way up and sold after the peak. I’ll buy again when the market finds bottom; in the meantime I retain my gains. Those who say you can’t time the RE market are generally people who want to collect transaction fees or are trying to justify to themselves why they are just letting their equity evaporate.
the median income in 06 is irrelevant today
thousands of jobs in mortgage and real
estate have disappeared– many more are
working but making less alot less and the
ravages of inflation SEE GAS are having
severe ramifications on the middle class
which begs the question thoughtless
what planet do you currently reside on
Try 180%.
Somehow I think trs will be fine in his Newport Bayshores home. Sounds like sour grapes.
trs:
Normal guys don’t make 250,000 a year. You are near the top of the food chain, which would ideally put you in Newport Beach. Unfortunately, with the lending requirements today- it would be hard to find a buyer for your home because they would have to sell theirs and get that pretend equity they have as well as you would.
250,000 a year should put you in a home under a million (hard facts- you don’t rate a 2.2 million dollar home). Also, you are not a millionaire until you actually sell your home and put that money in your pocket. Which would be the only way you could buy another Newport Beach home right now. You certainly couldn’t realistically do it on your income. btw- on your income you SHOULD be able to afford a nice home in a nice community like NB. The problem is that there are many people like yourself, making even more money, that can’t afford to buy here. Homes are so overpriced here, it is pretty hilarious to sit and watch over the next 2 years at the prices falling as they should.
why don’t you take the rest of the HELOC and buy a couple range rovers and really pretend your a millionaire!
PDU:
I have a long history on this blog posting many times about my methods in calculating absorption rate. I started my post by telling everyone to review them, so that my position would have some credibility. You are welcome review them, too.
Bill:
LOL. Yes, I know I am not the only person with a pool in his backyard. That was my point all along. Let me tell it another way….
While so many here debate what’s good and bad, others (including myself and MILLIONS more) go on with their lives enjoying the decisions they have made. I wish the same for you, and all others here.
Also, I did NOT know Brea borders Diamond Bar, and that it is one of the smoggier cities in Orange County. Thanks for telling me. I have decided to put my home on the market immediately, and to sue my REALTOR for not disclosing these facts, even though I have lived here for 25 years. I am VERY grateful to you.
Finally, this was yet another periodic visit of mine to Jon’s blog that ends up frustrating more than enlightening. See you in another 30 to 45 days!
(tried to post this earlier, but still awaiting moderation)
trs:
“Normal” guys don’t make 250,000 a year. You are near the top of the food chain, which would ideally put you in Newport Beach. Unfortunately, with the lending requirements today- it would be hard to find a buyer for your home because they would have to sell theirs and get that pretend equity they have as well as you would.
250,000 a year should put you in a home under a million (hard facts- you don’t rate a 2.2 million dollar home). Also, you are not a millionaire until you actually sell your home and put that money in your pocket. Which would be the only way you could buy another Newport Beach home right now. You certainly couldn’t realistically do it on your income. btw- on your income you SHOULD be able to afford a nice home in a nice community like NB. The problem is that there are many people like yourself, making even more money, that can’t afford to buy here. Homes are so overpriced here, it is pretty hilarious to sit and watch over the next 2 years at the prices falling as they should.
why don’t you take the rest of the HELOC and buy a couple range rovers and really pretend your a millionaire!
What a silly argument. Houses are bought with income AND assets, and trs has plenty of both. Newport is NOT a place to start out with few assets, no matter your income (unless you have a really great jumpshot).
Hmmm, take away the asset portion of the income and assets that ALL people use to buy homes. Makes sense.
LOL, troughless….. when you are talking the median priced home……. if you include an asset requirement…. affordability actually gets far worse……… as prices plummet further due to down payment requirements.
i’ll give you that assets allow people to buy homes greater than income for the higher priced home segment, i.e. rich people greater than $1M………..but for the median priced home…… asset requirements are not that great………… you need the 100% financing days to come back
Mav, assets are NOT reserved for the rich. A common scenario here is someone putting down $300,000+ on a $1,000,000 home and financing the balance. This helps greatly with “affordability”. The no down loans YOU are talking about are found mainly in the lower rungs of the market. I’m sure you’ll come back with a cherry picked example to refute this, but those are statistically insignificant.
Price of Bad Tidings says: Don’t forget to taunt those who were born too late. Now, they’ve missed the ship and will never be able to own in OC.
If you were born in Manhattan, do you have the RIGHT to own there at a certain price?
If you were born in Brentwood, do you have the RIGHT to own there at a certain price? How about Malibu? LaJolla? Beverly Hills?
Guess what, go check out some median prices for Pasadena, CA. How about Sherman Oaks? Check out West Hollywood. Where is this sense of entitlement coming from? Why is OC any different?
It has become quite comical of late to listen to the vitriolic hatred coming from rants…I am sure it has lost it completely.
Great post from Pat…2.8 years of product…that is the funniest and most off-base stat I have ever seen on this blog…Collins, that was a joke.
Troughless, no crap……. but this is all about lending requirements……. and the size of the pool of qualified buyers.
The first requirement is income………. that decreases the old pool for mortgages.
The next requirement is assets….. that further decreases the old pool for mortgages.
Agreed….. a great jump shot or a killer curve ball could help you buy a Newport Beach home…….. I wish I had either.
Why on earth do you all continue to think that every bull is one person?
Pat,
Did you expect to be able to come here, insult anyone and everyone who has a different perspective on the market conditions than you, (”you continue to cheer for the coming crash that will have sellers paying you to take their ocean front mansions off of their hands….”) - did you expect a welcoming party after a comment like that?
My first thought was you might have had one beer too many in your pool; my second thought was that maybe things aren’t going as well for you as you want us to think.
It’s either that or you are a textbook example of hubris - and due for a dose of humility.
Two more things, Pat. First, I am well aware of your posting here in the past.. I’m also well aware that you announced your decision not to post - probably a wise decision, based on your post today, Secondly you ask us— no, you TELL us, “to review them, so that my position would have some credibility. You are welcome review them, too.”
Pat, in spite of your special invitation to me, I don’t think I’ll review them…… AND I don’t see your “position” on this post.
Is it maybe in a post here under a different name? :)
Ahhh, yes, pdu…must be under another handle. I mean, there is no way more than one human being could have a different opinion than that of rants, yourself, Bill, etc. The glass is not half-empty for everyone like yourselves.
Mom in CDM: if “trs” is making $250,000/yr living in NB, he is slightly above avg. there. Certainly way above avg. for say Lake Forest, but NB? Not so much…why do you think you see multiple exotic cars roaming those streets on a daily basis? You can go to Houston, TX and not see a Ferrari for months, and there is plenty of “good ol’ oil money in that town”…but in Newport? Virtually every day…just like Beverly HIlls.
Bill: there are plenty of IO loans available today…you must not be looking very hard if you truly believe they are non-existent.
Mulligan,
Your reading comprehension leaves a bit to be desired.
Pat said, “I started my post by telling everyone to review them, so that my position would have some credibility.”
I said: “I don’t see your “position” on this post. Is it maybe in a post here under a different name?”
Do you see Pat’s “position” in his post?
pdu: why would you assume that pat posted under another name?
Sorry pdu, but you all have been very accusatory of myself, thoughtful, truthiness, pat, sigh, etc. as being the same person. So, when you say, “perhaps it was under a different name,” how do you think we are going to take that?
Pat knows his home is worth less than it was 3 years ago…as is mine. Alot less. The true debate here is “what is a normal price point?” The bulls contend that values are worth more in many areas of OC than others. It seems you all want a massive correction so you can buy at the “appropriate price.” Regardless, the market will set the prices…not realtors, appraisers, etc. Buyers and sellers will accomplish this.
By bet is it will be higher than many of you care to believe.
Again Mulligan,
Please, re-read what I said:
“AND I don’t see your “position” on this post.
Is it maybe in a post here under a different name?”
Your reading comprehension skills appear a bit low.
It was a statement and a question.
The reason for the question, (if you don’t understand) was that there WAS no stated position in Pat’s post AND he referenced a “position”.
No assumption. Just a valid question.
Seems you are making a few more assumptions:
“Pat knows his home is worth less than it was 3 years ago…as is mine. Alot less.”
Why are you speaking for Pat?
alright pdu…i will see it your way. The benefit of the doubt is yours.
So I’ve been trying to figure out why there are always so many Armageddon-type theorists posting on this site, claiming 20-40% more reductions in real estate prices.
In short, the people that are making the most noise on this web site about the real estate correction, stand to benefit the most from reduced prices. These are mostly first-time buyers and rental folks who are in the market for a house. In their case, it is in their financial interest to portray the market, anonymously, as gloom and doom, in the hope that prices will continue to fall, thus enabling them to buy houses more cheaply.
Now it is granted that prices have reduced a great deal, and I don’t know what they’re going to do in the short term. I am not a real estate investor and really don’t care much about what the market will do.
But keep in mind that almost everyone posting anonymously on this site has a conflict of interest. Don’t trust the Internet.
Peace Mulligan,
Too nice a day for this nitpicking.
Pool time! (For those inlanders, beach time for some others:)
Make note that pdu and Mully are in a agreement with one another…have a great day pdu at the beach, or pool, or wherever…just spend it with loved ones and know that every day is a gift.
Golly, Mulligan, I’ll bet we could agree on quite a few things!
Back at you, and Thanks!
byrd Says:
April 27th, 2008 at 11:49 am
So I’ve been trying to figure out why there are always so many Armageddon-type theorists posting on this site, claiming 20-40% more reductions in real estate prices.
In short, the people that are making the most noise on this web site about the real estate correction, stand to benefit the most from reduced prices. These are mostly first-time buyers and rental folks who are in the market for a house. In their case, it is in their financial interest to portray the market, anonymously, as gloom and doom, in the hope that prices will continue to fall, thus enabling them to buy houses more cheaply.
Byrd, 90% of the people here own or have owned houses in the past. They are not first-time buyers. They call themselves “Investors”. I call them speculators.
Speculation: “Financial speculation, involves the buying, holding, selling, and short-selling of stocks, bonds, commodities, currencies, collectibles, real estate, derivatives, or any valuable financial instrument to profit from fluctuations in its price.”
As a Orange County realestate investor the one lesson I have learned is to never catch a falling knife.
Properties in certain area of the county are dropping faster then others that’s a given. Don’t forget the GDP of the county is larger then some countries such as Finland. The economical outlook looks better for the most part for Investing in real estate all you need is patience.
The current problem I see is that families still need a roof over the heads and are having a hard time trying to qualify for a loan with credit scores of 790. This will change as it always does from one extreme to an other.
I also have been busy with short sales and chapter 11 and chapter 13 bankruptcy. This clearly show me that the end is not near at this time. Need to observe the market in the next 60-90 days and have the market dictate when it is near.
http://www.simonvolkov.com
how the hell is a return to normal historical
valuations translate to wishing for
armegeddon? the real hypocrites on this
blog are the greedy imbiciles that bought into this
bubble and its wealth creation out of thin air
mentallity they are in the process of getting
their just due enjoy it
Couldn’t help myself after a trip to Best Buy to come back and see further dialog. It seems sarcasm is lost on so many here.
My “position” is that statistics can be utilized to promote an agenda. (I have been accused of same, which is the reason I so seldom post and will no longer post inventory results.) My position is also that inventory results (or absorption rates) must be objective, and to use any 30–day time frame is arbitrary and dangerous, and can overstate a downward trend in the market.
I have always used a 12-month seasonalized time frame, which some take issue with, and can — admittedly — understate a downward trend in the market. Many here take issue with that practice, and did so in repeated posts last year.
However, I noticed that NOBODY took issue with CAR’s use of a single 30-day time frame in the slowest selling few months on record. Forgive me, but I thought my position had been made clear many times on this blog, and I did not want to take up more space than necessary.
One other anecdotal piece of info — Best Buy was EMPTY. It seems that those here who wrote many times that the home equity ATM was fueling a majority of consumer spending may have been right.
I purchased my first GPS unit, waiting for the portable units to come down in price, so that I could move it from one car to another. I used it to navigate my way home, and I must say it’s the absolute best technology for $249 I could ever imagine. (I had trouble spending an extra $1800 for the onboard option in my car.) This fits in my pocket, too, and I can take it with me when traveling and use it in my rental car. Simply amazing.
Have a great day!
Pat, When it’s 100 degrees outside people aren’t going to be crowding best buy. They go to the beach or go for a swim in their pool.
The stores I hit today were packed, without exception. Byrd, you hit the nail on the head. And shockg was right, most of these people have owned before. They made large bets when they sold, and now need 20% discounts to even break even. The pressure is on for them.
Mulliganville Says:
April 27th, 2008 at 10:08 am
“If you were born in Manhattan, do you have the RIGHT to own there at a certain price?
If you were born in Brentwood, do you have the RIGHT to own there at a certain price? How about Malibu? LaJolla? Beverly Hills?”
Irrelevant. You are targetting select cities. As I have stated before, I expect a few OC cities to be expensive, but not all of the county. Make a note of that before you compare cities to counties.
Pat, I was looking at GPS units today myself — WAS THAT YOU???!!!
Nah, just kidding. I was at Costco:)
Got confused, so I put it off until I know what advantages/disadvantages I need to be paying attention too — that and my wife’s reaction the other day when I mentioned I had seen one at Costco…. she said, “DON’T….Father’s Day is coming.”
It was nice of you to clarify your “position”. Your point is valid and you appear open-minded — recognizing that any time frame might be subject to criticism. It’s the old statistics can lie, or even be made to lie (or hide the truth).
Please don’t try to read anything into my statement here as I don’t claim to know where this market is heading. I only have a problem remaining silent when i see someone with an agenda attacking others or attacking common sense. Again, no veiled references to you intended:)
Sometimes I feel “the experts” are less in touch than many who post here and it might be because many who post here have been close to this market in a more personal way than many who study it.
Perhaps some here came close to buying in the recent past and felt “priced out” — unfairly so, as they watched others buying and driving up prices higher than common sense would justify. Common sense being intrinsic value and affordability. Co-workers that made no more than, or even less than they, buying with no down…. then six months later hearing the home had increased 50K…..enough of this going on and one would start to question their own judgement. Everyone getting rich on real estate and prices going higher by the week….”Maybe that realtor WAS right who told us it never goes down and if we didn’t buy then we’d be priced out forever.”
All this time knowing it would be foolish to commit to payments that were more than made sense, especially compared to rent. Payments that had the potential to increase dramatically.
Nothing fit the guidelines of financial prudence or the guidelines of common sense when values were increasing faster than what some people EARNED at a job.
OK, I’m getting carried away here, you know where I’m going…..the market today is validating the decisions made by many prudent, solid, decent people who used caution in the face of financial temptations that were daily telling them that everything they knew was wrong.
It wasn’t wrong.
Hard to measure the emotional impact that being right and still losing might have had.
Hard to measure the satisfaction some of those same people might be feeling now.
This is uncharted territory.
Interesting how the taunting “owners” have changed from a position of calling renters “losers” to now chastising them for being opportunists.
The desperation is staring to show.
OK, I’m done. I’ve already made my position clear - I believed back when, and still believe, prices will need to drop until there is a near parity between rents and payments. I said “near”.
No predictions, just relying on common sense to return, because for too long there were “payments” available on large mortgages that led people to believe they actually could afford homes that were priced beyond their ability to pay.
People weren’t paying attention to prices, only to payments.
In all this, Pat, I somehow have missed your take on what you believe might be down the road as to pricing and inventory….time until turnaround, etc.
Incidentally, by “turnaround” I don’t mean a return to prices and increases we saw recently.
I realize your position might preclude predictions, but it shouldn’t preclude sharing some thoughts.
If I don’t agree, I can always hide behind anonymity and call you names:)