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Demand for O.C. homes highest since Sept. ‘05
June 15th, 2008, 3:00 am · 75 Comments · posted by Jon Lansner/ocregister.com
Market watcher Steve Thomas at Re/Max Real Estate Services in Aliso Viejo reports that shoppers’ demand for O.C. housing (as measured by homes placed into pending escrows in local brokers’ listing service within the past month) hit 3,060 last Thursday — highest since September 2005. Meanwhile, the active inventory of O.C. homes listed for sale dropped below 15,000 for the first time since the beginning of January.
Says Thomas: “Many homeowners do not want to compete with the volume of short sales, sellers who owe more than their homes are worth, and foreclosures. The general public is acutely aware that it is a buyer’s market and that it takes a lot of time and patience to sell. I was expecting the inventory to grow to 20,000 homes, but I simply did not factor that the public would perceptively refrain from marketing their homes without proper motivation.”
Thomas also calculates “market time,” a benchmark of how many months it theoretically takes to sell all the inventory in the local MLS for-sale listings at the current pace of pending deals being made. By this Thomas logic, it would take 4.86 months for O.C. buyers to gobble up all homes listed for sale at the current pace of deals vs. 5.61 months two weeks earlier and vs. 8.50 months a year ago.
Here’s data by the price slice as of last Thursday for O.C. homes listed on market; pending deals, Thomas’ market time, in months; and market time two weeks ago and a year ago (Note: k=thousand; m=million) …
| Slice | Listed | Deals | Months | 2 wk. ago | Yr. ago |
|---|---|---|---|---|---|
| All O.C. | 14,880 | 3,060 | 4.86 | 5.61 | 8.50 |
| •$0-$500k | 7,126 | 1759 | 4.05 | 4.60 | 8.58 |
| •$500-750k | 3,163 | 764 | 4.14 | 5.00 | 8.63 |
| •$750k-1m | 1,696 | 283 | 5.99 | 6.98 | 6.98 |
| •$1-1.5m | 1,266 | 152 | 8.33 | 9.80 | 8.00 |
| •$1.5-2m | 696 | 59 | 11.80 | 14.71 | 9.92 |
| •$2-4m | 816 | 46 | 17.74 | 14.89 | 13.11 |
| •$4m+ | 338 | 10 | 33.80 | 66.80 | 12.23 |
Other signs the market’s turning ….
- Cheapest O.C. homes selling best in late-May
- Sellers want more for O.C.’s pricier homes. Again!
- Insider QA hears housing to be ‘healthy’ by ’09’s end
- O.C. homes seen undervalued, 1st time since ‘03
… And check out what was May’s hottest stories on this blog by …
CLICK HERE!
June 15th, 2008 at 5:15 am
This is good news for home owners. Let your house go into foreclosure and then the bank will be able to sell it at a bargain price in a few months! Talk about a sweet flip.
June 15th, 2008 at 6:52 am
Funny how there is no mention in this report of home prices.
Talking about an agenda.
The houses that are selling are going for 2003 prices. As soon as they try to increase prices, you’ll see the demand evaporate.
It looks like Steve Thomas is the new Gary Watts.
June 15th, 2008 at 7:19 am
To all you small thinking bitter renters that post on these blogs….ITS TIME TO BUY!!!!
June 15th, 2008 at 8:03 am
This activity in the middle of a recession is nothing short of breathtaking.
June 15th, 2008 at 8:12 am
I am still waiting for the number of 3060 that are distressed sales. This info is useless unless that info is included.
So what is that number?
June 15th, 2008 at 8:22 am
Is Steven Thomas on the Register’s payroll? I guess if you pay for enough ads, they will print anything you hand them. That would make sense why the Register is compelled to publish his nonsense. A good question is: Why are we reading this fabricated fantasy?
June 15th, 2008 at 8:25 am
Sold my house in August of 2005 for 580. The realtor made a slimy back room deal and I should have gotten 600. Today I could not get 400. Breathtaking. (For the new owner)
You got to love realtors!
Have a wonderful weekend.
June 15th, 2008 at 8:29 am
Jake,
out of curiosity. what kind of back room deal did your realtor make?
June 15th, 2008 at 8:34 am
renters, what are you going to do. you are in a tough spot. you sat on the sidelines for a decade while beach houses made owners instant millionaires. you said prices are too high because fundamentals say so. now the crash has finished. problem. only ghetto and distant towns crashed. those beach houses are sky high. they are ready to rise again. renters, do you have a plan B. plan A did not work. you are down to two choices. you could move out of OC. or you can buy a ghetto house. i would move out. the central Ca coast is a good deal. nice area. good jobs. what are you waiting for. forget the OC beach house. getting one of those on the cheap is a populist dream.
June 15th, 2008 at 8:39 am
My realtor said that he had no clients but if we upped the commission people would come to see it. He actually had a client in mind and I upped the commission and so both realtors then got more commission. The buyer came out of the woodwork one day after commission went up. But I had seen that buyer and their agent before. All of these people lived in the neighborhood. Hey but what is thirty grand amongst neighbors?
My realtor had one open house and showed it a few times made around 11k in commission.
Plus the realtor priced it below market to move it quickly so he could get his quick profit. Similar house sold by better realtor for 617.
He presented the trust me I am a professional attitude. Reminds me of the one crazy bull on this blog. And who might that be and what are his names.
June 15th, 2008 at 8:44 am
trs,
what type font do you want me to use when drafting your NOD?
i want to be as accommodating as possible………. as I mentioned to truthi i can even get some bratty trust fund kids to show up on the day of “closing”………..so you can pretend you are passing it to your “heirs”…….. the faux rich are in for a wold of hurt…….. suckers……..
June 15th, 2008 at 8:47 am
My realtor was a real smart guy. He sold his house for top dollar in fall 2006. Then he bought two properties that were good deals in 2006. He is now near the beach. Well at least he is underwater!
June 15th, 2008 at 8:55 am
Excuse me, Thomas logic-
As for the months it takes to sell inventory, EVERYTHING sells at auction!
Banks are the buyers simply taking back inventory.
June 15th, 2008 at 9:00 am
Again, no surprise here. As prices drop, more people come out and purchase. I’ve seen it first hand as I’ve put in a couple of offers and come out empty handed. If it’s priced right, it’ll sell, no matter what the market is.
My daily search from marketlinx shows literally 98% of homes on there still show that “price decrease” pasted to them. That and listings have risen from 135 to well over 1100 since beginning of ‘07 with no sign of slow down in my particular search.
As long as prices aren’t going up, future buyers are still in the drivers seat. I can take my sweet time.
June 15th, 2008 at 10:00 am
rants, prices down 20%? nope. no drop in beach prices. rants, what you see is ghetto prices down 20%. you should correct your statement. you wish beach prices were down by 20%.
June 15th, 2008 at 10:17 am
jake:
I’m real sorry to read about your slimy realtor. If it’s any consolation, I’ve seen more than a few short sale listings where the description reads “owner is a realtor.” They have set themselves up also.
June 15th, 2008 at 10:18 am
Laguna Beach sales are down 60%
Newport Beach sales are down 54%
How can you tell if prices have dropped if there are no sales????
Beach real estate is always the last to fall, and they historically drop by the same prices % as the rest of So Cal before housing bust finally bottom. So, yeah, maybe beach housing price is not dropping right now, but if this market is ever going to bottom, they will have to be hit too.
Remember a few years back Santa Ana had -60% sales with very little drop in pricing. First sales stop and then prices drop. Beach Cities will be hit just like the rest. It just will be the last to fall, and then people can start talking about a bottom in the market.
San Diego beach city pricing is starting to get hit right now, and San Diego was among the first feel the bust. So patience. The OC has not gone thru it’s complete housing bust cycle. The OC was late to the bust, but the whole county will be hit before it bottoms!
The OC’s housing implosion continues……………………
June 15th, 2008 at 10:20 am
This guy has been yapping about demand of biblical proportions for about 3 months but the sale numbers keep declining.
I guess we have to wait for sales to pick up as the price of oil, food, and mortgage rates increase. We are all aware of how much stimulus this gives the market.
June 15th, 2008 at 10:22 am
Great news! Demand for homes is now that same as when they started falling off a cliff!
June 15th, 2008 at 10:29 am
Only a Realtor(R) could find good news in Thomas’s report:
- Demand above $750K down 27% from last year.
- “The surge in demand is really isolated to homes below $500,000, where demand is up only 57%.”
- 64% of homes under $500K are foreclosure or short sales.
The foreclosure mess is spreading:
- Dana Point 15% distressed
- Huntington Beach 22% distressed
- Even Newport Beach has 47 distressed properties on the market
This is going to get a whole lot uglier. Buy now and you are making one of biggest financial mistakes in your life.
June 15th, 2008 at 10:32 am
Hello,
This is Iowa Dave. Free water to anyone in SoCal who wants it.
My mortgage isn’t underwater, but I am.
June 15th, 2008 at 10:54 am
I was expecting the inventory to grow to 20,000 homes, but I simply did not factor that the public would perceptively refrain from marketing their homes without proper motivation.”
23%-27% discounts are not proper motivation for sellers but without these reductions you will not sell your home, again not proper motivation.
2003/2004 pricing with good rates is doing the trick for under 500k which is where the 600k homes are headed.
Watching your homes value collapse is nothing short of breathtaking, however it does help sales.
June 15th, 2008 at 11:07 am
Ive seen homes in irvine off 20 percent, I would hardly call them ghettos
June 15th, 2008 at 11:09 am
Actually, closed sales are tracking new pendings fairly closely. Both have been marching steadily higher for many weeks. It would help if people understood this report.
June 15th, 2008 at 11:38 am
Hutton Center high rise condos - over, done caput. Builder quit building - we have a high rise condo develpement in the middle of orange county that wont be built for years! rumor has it the state is going to take it over and turn it into “public” housing. From $1 million penthouse to you need to make less than $50k in income to qualify in a blink of an eye.
June 15th, 2008 at 11:47 am
Can’t Jon see that Steve Thomas is always going to have a biased spin favoring the real estate companies.
No matter how “empty the glass is” Thomas will always look at the “full” aspect.
Right now “the glass” is about “a quarter full”
June 15th, 2008 at 12:02 pm
Sigh says:
By the way, the “temporary” High Cost Area Jumbo Conforming and FHA loan limits are already in the process of becoming permanent. Expect extensions of the provisions of the Stimulus package to be completed by November of this year.
Who cares Sigh? These loans are not helping many people now, nor will they in the future. I wish they did help more people, but reality is what it is.
June 15th, 2008 at 12:10 pm
Thomas is wrong. Demand hasn’t risen that much. Nor is “pending” sales tracking closed. Matter of fact, sales have crashed so far in June.
Embarrasing this Thomas dweeb gets any time. He is lying and the numbers prove it.
June 15th, 2008 at 12:13 pm
Sigh, your a mumbling mess. Not only is “Steven” saying nothing, there has been no improvement. Deal with it and move on.
June 15th, 2008 at 12:25 pm
hey trs are you stuck on stupid– read the
median price arrow on the right side of lansners blog
it says down 23% since last year– dude you dont own
beach property so why the hell would you even care what
its done clueless twit
June 15th, 2008 at 1:01 pm
Some people say, “All ships drop at low tide.”
I guess we’ll find out how bouyant beach cities really are.
June 15th, 2008 at 2:16 pm
OK, for the last time:
Steve Thomas or any other Realtor does not care about pricing. I would not personally take a listing from an unrealistic seller in this market. Why would I? I would have 10-20% of my “commission” (assuming it closes) to spend in marketing a non-marketable property? This is where you guys just miss the Realtor thing entirely. Not many professions spend their own cash and do the work PRIOR to being paid…usually many months later. So many of you are assumptive and you paint with a very broad brush. There are many excellent Realtors in the industry. Sorry to hear that some of you have met some unscrupulous ones. Any profession with this number of people will have the question marks…think doctors and attorneys. Ever dealt with one of these you wish you never met before?
The bottom line is pending sales are rising, with the bulk of the deals below $500,000. Rising tides lifts all boats…or if you are a bear, low tide grounds them all.
Happy Father’s Day to you Dads out there…
June 15th, 2008 at 2:51 pm
The t r oll is right , realtors are no worse than other profession. I mean they are much more honest than ceo’s , maybe insusrance used cars, oncologists, many others.
But remember this, a realtor really makes good money if the property moves. So as a buyer your realtor wants you to pay more to close the deal. As a seller the realtor wants you to drop your price to close the deal.
So your agent really works for the seller and the other guys agent is really working for you.
So watch out!
June 15th, 2008 at 2:57 pm
When I said we do not care about pricing, naturally I mean we do not care about an escalated price…that is: we do not want sellers to price their homes too high. It makes zero sense. In the boom years, it made sense for sellers to price their homes high.
Jake you are sorely mistaken…and quite funny without meaning to be…I am wondering how many buyer’s agents out there today are encouraging their clients to submit a higher offer. If I were representing a buyer: I would ask them one question. Why are you buying this home? Their answer would then depend upon which direction we are going with price.
June 15th, 2008 at 3:02 pm
–That is what any professional like our resident realtor would do. Realtors are just like any professionals. You get in there way and they get mean and profain. Just another day in OC.–
It is THEIR way…the possessive form. Sorry dude…ask pdu and Bubbs…they know I am singularly Mully…but if it makes you feel better to think there is only one person disagreeing with you, so be it. Not everyone thinks alike you know…or maybe you do not.
June 15th, 2008 at 3:11 pm
Trola , Trola
How many realtors would not ask there client to pay 10k more if would seal the deal. How many realtors would not tell there client to drop the price 10k if it would seal the deal.
Think about it. Your protest is kind of funy.
June 15th, 2008 at 3:26 pm
I dont think 10K means a whole lot to most realtors, so I think I agree with Mully. If a realtor is representing a buyer 10K means an extra $300 at best…a percentage goes to the “office”, advertising, etc….so I would assume (not being a realtor), the realtor wants one thing to sell the house as soon as possible. This will minimize the cost of listing, their time spent showing the house, etc. This allows them to move on to the next house.
This market is unique as compared to the previous market. I can also assume those realtors that have been around since the late 80’s/early 90’s are better prepared to handle it. I would think that good portion of the realtors that are still around are probably more proffesional and have more exp. That being said their are losers in any field and you need to read the fine print and know what you are signing before you do. Like I said the Realtor wants that sell no matter how they get it….so be cautious. Unlike in previous years, you know have the time to breathe and learn about the process.
On an interesting note, in the book Freakenomics, it states that on average realtors that sell their own homes let them stay on the market I believe an average of 2 weeks longer to get the price that they want. The signigance of this is that they want to sell for the price they want, while they could care less about 10-50K price swing for the people they are working for.
As a buyer, I dont really care what the commission is or what the deal they have with the seller. I want to buy for the price I know I can afford and for the home I want to buy. The current market is getting better and better for me.
I thank God daily I didnt buy a year ago. I have saved a ton of money by waiting.
June 15th, 2008 at 3:34 pm
sam,
you missed my point. the realtor representing the seller ask the seller to drop the price pretending to be acting in the sellers interest.
The buyer of course likes this and speeds up the deal giving the agents slightly less commission but fast turn around. The process can work the other way where the buyers agent pretending to work for the buyer tells the buyer to raise his offer. This makes the seller happy and makes the deal go through. The agent gets more commission but that is not the purpose. The purpose is always to speed up the deal.
June 15th, 2008 at 3:39 pm
Mulli,
Let us assume that Steve Thomas is correct. That more deals will close this month then a year ago. So what is your point? The price of food is going up. The price of gasoline is going up. These are probably also true. But what is the point?
I think people are interested in the direction of housing prices. So is your point that housing prices are going to rise soon? What is your point?
June 15th, 2008 at 3:43 pm
Realtors are worthless. The majority of people you speak with did more to sell their house than the realtor did. Here is a simple process for anyone reading this to pass on.
If you use an online listing agency like ziprealty or redfin, etc. then you are simply with the times and are ahead of the game.
If you use the classic, senior citizen, old school method of hiring the clown with a glamour shot photo on their business card, then atleast do the following simple task:
find out the total commission they will make…take 66% of that amount and demand in the CONTRACT that they will commit to spending that amount to MARKET your house seperate of the MLS. Where will you be able to go to see your house listed on a billboard? in a fine magazine? in theatres? at bus stops? people walking around spinning things for you?
Secondly, setup a set number of open houses that they will put on for you, and here is the real gotcha…make sure clownass contractually must show up and do flips for you.
Sound Silly? So does hiring a realtor.
June 15th, 2008 at 3:47 pm
Well I guess we do agree than. The major goal is always to sell the home as quickly as possible. Like I said a small swing in price means very little to a realtor. It is all about volume.
To me it is a little bit like waiting tables, which I did for years during college and my internship. For certain a high ticket price was good, but having a table buy a couple of 5 dollar dessert that will keep them around another 10-15 minutes as compared to having a new table. Ill take a new table. It is all about turn and burn.
June 15th, 2008 at 3:57 pm
Sam,
And volume means the realtors interest is very different than the clients interest. The client should take months to look around because the market moves slowly over months and the client has a very big stake in making an informed choice. The realtor however sure does not want to spend months with a client so it is in the realtors interest to make up stories to move the process along.
June 15th, 2008 at 4:38 pm
Call me crazy, but I guess I thought the purpose of any job that involves the sale of a commodity was to sell as many “widgets” as possible in the least amount of time, for the highest amount possible. Its a dumbed down form of pareto efficiency. Why should the professionals in this industry be looked down upon for optimizing their market any more than any professional in any other industry?
June 15th, 2008 at 4:42 pm
“know nothing”
June 15th, 2008 at 5:05 pm
Looks like old mully is not happy watching the profession head for the crapper.
You could not be more worthless amigo(a)? I am a long time business owner that had to watch W2 losers come close to business owner incomes with the biggest bubble in history.
know this, people with money want to remain people with money.
there is a definate sea change in how loans will be processed…the guchi wannabe loser loan agent is gone forever.
next will be the RE…simply stated we could always use SOME kind of assistance in finding homes, but the amount of money MUST go down since the payout is not relative to the amount of effort required…simply laws of life my friend.
Whether the walmart agencies or the virtual agencies or somewhere in between, we will have a change.
If you cater to a very exclusive beach front clientele then you are good to go. As a business owner I have made relationships that make me money from my good efforts. There is nothing wrong with the top 1% of agents being well off with their small list of wealthy buyers…there is a better chance that someone with contacts can get a license and make money than there is of someone getting a license and then making those contacts.
June 15th, 2008 at 5:23 pm
The top 20% of agents do 80% of the business.
June 15th, 2008 at 5:27 pm
I think it boils down to jealousy…some agents make sick money…they just do…they are good at relationship building and they facilitate things for their clients to make their sale/purchase simpler and more streamlined. If you are selling and want to use Zip or Redfin, knock yourself out. I think you get what you pay for in this business. Professional photographs can make a listing more valuable just by the way it is presented in ads and online…with Redfin, the buyer takes the photos or hires the photographer…it all depends upon how much someone wants to bite off in the process…no free lunches.
June 15th, 2008 at 5:35 pm
BTW Dingleberry, to call someone worthless simply illustrates what little character you have. Sad bro…truly sad.
June 15th, 2008 at 5:37 pm
So I would agree with the point that it will help to set up for price increases in the future to work off reos and shorts.
But you seem to agree that these have not been woked off yet and prices are continuing to fall.
Two simple statements. If you disagree with these simple statements I would like a simple correction.
June 15th, 2008 at 6:14 pm
Given the number of deals - and the inventory has fallen just below 15,000 - there is still a significant number of homes being added per month. Kepp in mind that many are not getting to the MLS as well. At the rate banks have been adding homes to inventory, I would think inventory numbers would decrease more signifcantly given this kind of acti