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O.C.’s home pain? $1 lost every 3 minutes
June 16th, 2008, 12:12 pm · 40 Comments · posted by Jon Lansner/O.C. Register columnist
May’s DataQuick report shows O.C. prices at a low not seen since March ‘04, certainly a factor in homebuying hitting a nine-month high.
But look at the drop in pricing this way: Since the peak of the median selling price last June, the typical O.C. seller has seen home pricing fall at a rate equal to a $1 drop every three minutes of every day for 11 months!
Here are some other highlights of DataQuick’s May report…
- O.C. foreclosures hit record high in May
- Last month’s median home price below $500,000, 1st time since’04
- Homebuying pace is best since August
- ZIP-by-ZIP results are HERE!
Here’s some background on what’s going on …
- Demand for O.C. homes highest since Sept. ‘05
- O.C. mortgage rates spike to highest this year
- O.C. homes seen undervalued, 1st time since ‘03
And …
- Vote in our poll: Has the bottom arrived?
- See the accompanying photo? It’s part of Register photographer Eugene Garcia’s great foreclosure-home essay. Click on the photo to see it or find it HERE!
June 16th, 2008 at 12:18 pm
“the typical O.C. seller has seen home pricing fall at a rate equal to a $1 drop every three minutes of every day for 11 months!”
many of those where the fools that followed advice from Thoughtless, Sighburdud, and Steve Thomas
June 16th, 2008 at 12:27 pm
I think Lansner is on speed!
First thing this morning he calls the bottom to the greatest housing implosion in The OC’s history, and now he is putting out blogs like nobody’s business…………………………..
June 16th, 2008 at 12:30 pm
“Since the peak of the median selling price last June”
Garbage in, garbage out.
June 16th, 2008 at 12:37 pm
amazing losses. but is anyone really surprised?
June 16th, 2008 at 12:40 pm
People should read this article in CNN Money to get an idea of what is coming
June 16th, 2008 at 12:41 pm
I’m not surprised. As much as some people want to believe, it’s going to hit everyone, everywhere in OC RE. Though the higher end homes will hold up better they too will feel the pain more in the coming months and years.
NO AREA IMMUNE: Quite a change in environment here. This 4 bedroom, 2.5 bath foreclosure at 4 Langford Lane in Ladera Ranch sold at the peak in 2006 for $1,000,000. Neighbors said the last buyer owned a mortgage company that went under. Starting bid is $299,000.
June 16th, 2008 at 12:53 pm
LOL.
June 16th, 2008 at 12:56 pm
“Though the higher end homes will hold up better they too will feel the pain more in the coming months and years.”
No need to wait. The price drops in the higher end market is already here.
http://money.cnn.com/2008/06/10/real_estate/housing_crisis_hits_high_end/index.htm?postversion=2008061209
June 16th, 2008 at 1:32 pm
Bogus! Does that mean less prescriptions for Prozac will be filled? But what about my Expedition payments? HA HA HA HA HA HA HA HA.
June 16th, 2008 at 1:35 pm
Should we be surprised that there was speculation in Beverly Hills and/or that there is a foreclosure due to personal hardship (or money mismanagement).
With a whole 2% YOY price drop do any of us really think this makes a difference to the people living there – $100k on a $5M property?
June 16th, 2008 at 2:16 pm
I guess the NAR is looking even more lame now with their stupid “there’s never been a better time to buy a home” campaign. If you would have followed their advice you’d be losing “$1 every three minutes”
June 16th, 2008 at 2:44 pm
hey thoughtless, mull-vile, and p-dud: Check back this fall after the rebate checks are all spent and there is nothing else buffering $4.50 a gallon gas shock effects. As bad as it is now for real estate, it will be worse by then. I will be here to say I told you so, ya ostriches!
June 16th, 2008 at 2:53 pm
Time is money!
June 16th, 2008 at 2:57 pm
shiny,
Shine your glasses, dude.
Don’t put me in with those other guys. It makes you look bad…..like you haven’t bee paying attention.
June 16th, 2008 at 3:55 pm
shiny:
it is peedoo not p-dud.
June 16th, 2008 at 4:27 pm
Jon,
Breaking the losses down in minuets might make the hurt less painful, but next year you will be breaking the losses down in seconds to curb the hurt.
How many minuets has sighburrdud owned his new home?
$480.00 a day
$14,400 a month
$43,200 loss in 3 months
You dang realtors never learn, do you?
June 16th, 2008 at 4:29 pm
typo: minutes
June 16th, 2008 at 4:40 pm
ONLY -25% TO GO!
WE’RE HALF WAY THERE!
June 16th, 2008 at 5:10 pm
CNN Article
Ten of the 11 cities with the highest unemployment rates in the nation are now in central California, with El Centro, at 18.4% in April, leading the way. Other double-digit disaster areas were in Merced (12.3%), Yuba City (11.8%), Modesto (10.7%), Visalia (10.3%), Hanford (10.2%) and Fresno (10%).
Hey, when did they move El Centro to Central California?
Also, those unemployment numbers quoted above, are about the average (although likely to go up due to lack of construction jobs)
http://www.economagic.com/em-cgi/data.exe/blsla/lauMT06234203
Most good paying jobs are still hiring. The obvious exceptions (housing related) as well as those industries that are waiting until after the elections (i.e. medical field). Relocation hires are still buying homes (most expect to be in the home for at least 5 years).
Lets hope for “a chicken in every pot and a (electric) car in every garage”
Oops, didn’t Hoover promise something like that?
I think the point is that most of us are hoping for a good employment and a stable housing market.
June 16th, 2008 at 5:21 pm
The oc housing market is in better shape then this. Still, higher end oc zip codes are holding most of their value. You should report the additional analysis that comes with dqnews reports. They state the bulk of the median drop is due to excessive foreclosure activity in low priced zip codes combined with low sales activity in high end zip codes due to a jumbo mortgage issue. However, contrary to excessive media spin, high end zip codes have had decent price stability. A story highlighting the median drop without explaining the cause can create a panic among older homeowners, and that could trigger a poor decision to sell a primary residence at a below market price. The media owes the community more than misinformation.
June 16th, 2008 at 5:36 pm
Jimmy,
Higher end OC properties are “holding” their value due to a lack of sales activity. A quick search on the MLS shows plenty of homes priced below the peak value, yet no activity after 150+ days on the market. That is for properties in the $750k $1.8M range….And the number of NOD and NTS is growing in the upper income Coastal areas I track.
This is far from over and the Coastal area is not at all immune to a serious price correction. It’s happening, the only question is whether you admit to it or ignore what’s happening. Denial won’t change the course of price momentum though…
June 16th, 2008 at 5:40 pm
This is the long and short of it
http://finance.yahoo.com/expert/article/moneyhappy/87379
June 16th, 2008 at 5:40 pm
“I think the point is that most of us are hoping for a good employment and a stable housing market.’
You must be new here.
June 16th, 2008 at 5:55 pm
Whats silly about this post is that you don’t actually lose value on your home until you sell it. If you are talking about your owner occupied property that you put 20% down on…don’t sell it for the next 3 years. If you are talking about your rental property that you put 20% down on, stick some renters in there and ride it out.
If you are talking about your home that was never within your means that you live in and have missed two months of mortgage payments on your 100% financed ARM that just reset… well I guess I just don’t have a lot of sympathy for you. You are the sector that is actually losing value, and eventually, your home. Oops.
June 16th, 2008 at 5:59 pm
take a tour of these foreclosures note the
selling prices and what the current asking
prices are now— theres a nice one in ladera
too- now repeat after me… I dont believe in
bubbles… I dont I dont I dont… the coming
fallout of this debacle is simply jaw dropping…
the human mind cannot even begin to
comprehend the ramifications of how this
is going to eventually play out in the credit
markets… we are facing something thats never
been seen before in the history of the world
this will make the real estate crash of the ninties
pale in comparison… how the stock market is
ignoring whats happening is simply astonishing
http://www.ocregister.com/ocregister/money/article_2067427.php
June 16th, 2008 at 6:00 pm
“Whats silly about this post is that you don’t actually lose value on your home until you sell it.”
That can’t be right. Owners have lost money and renters have made money. I heard it here, so it must be true.
June 16th, 2008 at 6:07 pm
Guess rants didn’t watch the video.
House #1 - no deal at $1.5M
House #2 - ready to fall over from structural damage
House #3 - normal drop
Bonus comments at the end:
“Inventory was at 12-18 months and is now at 6 months.”
&
“The best deals are still going for “over asking”.
June 16th, 2008 at 6:11 pm
Thoughtful,
Long time reader, first time poster. I get your point. Can’t we just all get along? Bulls and Bears get along fine in Chicago. I am a bullish bear or a bearish bull. I think we are at or very near the bottom (with a margin of error of 15% to allow the pendulum to over swing, over swing is the technical term for over correct).
I’ve got myself covered, a 1 room cabin in the mountains, and a nice home that I’ve owned since 2002. When the kids move (which I hope is soon), selling the home and off to the mountains with wifey.
Or. . . if natbub is correct, ditch the house and stock up on canned food, move into the cabin, grow a real beard and count the stars at night (hope the internet works up there!)
June 16th, 2008 at 6:14 pm
if you bought in the bubble, you have actually lost money versus renting the same house….
fortunately those losers can just foreclose, it’s as easy as pie….
June 16th, 2008 at 6:15 pm
We try to get along here, Reloman, but alas it is not allowed. You will soon be targeted for your daring views.
June 16th, 2008 at 6:37 pm
“The best deals are still going for over asking…”
And why is that?
Because they are REO’s discounted at 40%!!!
Incredible.
You want to show me a $900,000 home that has a sales price that not been discounted from last year that has had multiple offers on it?
Thought not.
June 16th, 2008 at 10:17 pm
Through the middle of last year, when the low-end market froze up, the high-end market kept on going, causing median prices to go up, and the pollyannas called it the “subprime problem” that was contained to the low end.
Now, the low end is going through its fire sale, median prices are going down (and pollyannas now discredit the median), and the high end is frozen due to lack of demand. Can the high end fire sale be far behind?
June 16th, 2008 at 10:43 pm
BHN-
If the high-end doesn’t have to sell, they may be able to wait out the downdraft. So there may be a dislocation in pricing.
The question is how long can the high end stay out of the market?
I’ll buy 2 $500k homes that used to sell for $750k, rather than 1 $1MM home that hasn’t fallen in price. I get $1.5MM in home value for the price of $1MM that way.
So I’m not sure how the price per square ft doesn’t affect a higher end home, but we’ll just have to see.
Even Villa Park is falling in price, as is Newport Beach.
June 16th, 2008 at 10:47 pm
# Jimmy2 Says:
— ” A story highlighting the median drop without explaining the cause can create a panic among older homeowners, and that could trigger a poor decision to sell a primary residence at a below market price. The media owes the community more than misinformation.”
–
Jimmy,
So nice of you to have those old folks best interest at heart.
Trust me on this one, they nearly all have a better grasp of what’s going on than you do.
They know markets go up and markets go down. The Beach or the Barrio.
Why YOU don’t know that yet is a thing to wonder about. Just what is your vested interest in all this?
Not that long ago you lamented that there were no properties in CdM selling at prices you considered worth moving on. Seems clear you felt they were overpriced.
Strange dude you are, Jimmy.
I notice 194 CdM listings with 99 of those now showing a price reduction since listing. Some fool realtors took listings at prices the market rejects.
You aren’t a CdM realtor now are you Jimmy?
Sometimes in the quiet of the night I read your rantings and declarations of the invincibility of CdM prices and worry that maybe you might be a realtor taking listings from gullible old folks who really want to sell. You convince them to hold those prices of yesteryear and some of these people are losing their bu tts chasing the market down.
Imagine the heartbreak some of your neighbors must feel……reducing their asking and hoped for prices by $200,000- $500,000 and the dang things STILL won’t sell.
What if the original price was arrived at with the help of a realtor? What if these old folks depended on a realtor for advice, a realtor who believed the beach communities don’t drop. A realtor who believes the same fantasy that you do?
June 17th, 2008 at 7:56 am
Hey, Thoughtful:
I am being sincere here… what would have to happen for your view of the housing market to change? What conditions would you have to see? Or do you not believe it until it happens to you personally? I’m just honestly wondering. I know some bulls believe that no matter how desperate things get, this is all cyclical in nature so their view is they are not concerned with it. Is that the stance you are taking and if so, what data or set of circumstances would change your view? Thanks for reading.
June 17th, 2008 at 10:28 am
folks, read this very interesting article.
It will show you how we got here and how bad things are
http://www.washingtonpost.com/wp-dyn/content/article/2008/06/14/AR2008061401479_pf.html
June 17th, 2008 at 11:09 am
Bubble:
Thank you very much for posting the link to that article. I read it and even emailed it to a friend who was wanting info in a clear and concise format on what happened and how we got here. The repercussions of this are spread far beyond the housing market and, in my humble opinion, are going to leave some permanent scars.
June 17th, 2008 at 6:28 pm
good article there Bubbs…credit where it is due…I must admit that I see very little finger pointing at RE agents in this article. I do see alot of finger pointing at loan officers, underwriters, and wall st…my position all along.
June 18th, 2008 at 8:47 pm
It can’t be lost if it was never theirs to lose in the first place. I feel sorry for people who bought at the top, but in reality those prices were artificially inflated and it is only now BEGINNING to return to reality.
http://www.beyondthemargin.net/2008/06/dirt-on-housing.html
July 2nd, 2008 at 11:30 am
I knew the numbers were bad, but for someone to put them on paper really does a better job of demonstrating how much of a depreciating asset peoples homes have been (those who bought during the bubble).