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The California Association of Realtors reported today that a dip in home sales last month may be a possible reaction to the economic meltdown.
The ratio of home listings to homes sold rose last month for the first time in 10 months. The association reported that it would take 8.5 months to sell all the houses on the market at last month’s sales pace, the first monthly increase since January.
But November also had fewer business days than normal. And the Thanksgiving holiday typically marks the start of a seasonal slowdown in residential transactions. In addition, sales of O.C. houses still were up 63% from November last year, the association said.
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The market likely reacted “in part to the worsening situation in the economy, the financial sector, and in terms of consumer and business confidence,” the association quoted CAR President James Liptak as saying.
The median price of an Orange County house fell last month to $453,060, the association said. That’s the lowest median price since March 2003.
The O.C. price was down 39% from the peak of $747,260 in April 2007.
Statewide, sales increased 83.2% from November 2007, while the median price of a California house dropped to $285,680, down 42% in the past year.
See our 2009 outlook interviews …
- CSUF dean eyes no home-price rebound until 2011
- Consultant eyes flat-at-best O.C. housing market
- Realtor group prez eyes housing’s opportunities
- Pimco’s Simon eyes O.C. home price bottom in late 2009
- Outgoing Realtor prez eyes O.C. rebound by summer
- Tell us what O.C. home prices will do in 2009
Other real estate news …
- O.C. builder pays CEO $3 million for 9-months work
- State agency halts affordable home lending programs
- O.C. bill-paying index at record low
- O.C. real estate/finance jobs near 5-year low
- Calif. home prices down 26%, nation’s worst — again
- Housing in O.C. beach towns slumps, sales off 28%
- O.C.’s newest beachfront listing: $36.9 million
- Bungalow from 1922 (or ‘48?) on the market in H.B
Today’s News Flash:
” Shirtless Obama photos circulate on internet, Dow tumbles 100″
News Flash from CAR:
” Gaylord shirtless pictures are safe “
I agree with the poster from Monday…it look like the CAR and NAR are now starting to position themselves for a bail out.
There is nothing that can stop the train wreck at this point. The real price declines will start in Q3 of 2009, so far we’ve seen a minor correction
I now live in the SF Bay Area (since Aug 2005). I am totally amazed at how little the prices have been affected in what I call the 20 mile radius surrounding both San Francisco and Silicon Valley (I call this my theory of concentric circles out away from the employment center…any home on this circle line will sell for approximately the same price, no matter the locale (bad neighborhoods excluded). So a home in Marin (the Corona Del Mar of Belvedere and Tiburon excluded) sells for the same as a home in Alameda County which sells for the same price in San Mateo County, all being 1 concentric circle away from downtown San Francisco.
2 concentric circles out, and prices start to fall off.
My theory is that people want to live as close to work as possible. Housing prices are on a teeter totter. The farther out on the teeter totter one goes, the more volatility in the up and down. If the fulcrum of the teeter totter represents the city center, there is no volatility in prices there, because as prices come down, people will move closer in, keeping prices in the city center more stable.
Still, there was a dump of a Countrywide foreclosure in Marin that went in the $900 range (the lender was into the home for about $1MM with both a 1st and a 2nd). I can’t tell you how many deals are getting done that still make no sense up here. It is downright scary! Now that my mother is situated with home help, my husband and I are seriously considering moving back to SoCal (as soon as the jobs market improves), just so we can get a GREAT home for $700K, versus an 800 sq ft dump up here.
News Flash, CAR reports that the ocean has water in it ! Please people, no more of these 2nd grade reports from NAR or CAR, where everey day is a great day to buy real estate. If they are not predicting a hosuing rebound every month, they are usually stating what everyone already knows.
NanoWest says:
“The real price declines will start in Q3 of 2009, so far we’ve seen a minor correction”
40% from the top is a minor correction !!!! You want another 40%? Good luck. Just don’t hold your breath, you may suffocate Einstein!! Why don’t you go teach in colleges and share your vast knowledge with everyone else:) !!!!
Shane,
Yes, so far we’ve only seen a small correction in some of the lower end markets. Next year we’ll start to see the real corrections. Look for homes that were selling in newport at 3 milllion to be in the 900K range, homes in irvine that sold for 1.5 million to sell for 500K.
Home sales will have nothing to do with interest rates, but with down payments and DTI. There is no trade up market any longer…………
Anyone smart enough to save money for a home, is smart enough to wait out the drop..
Shane, if you are looking to by a house now, find someone that purchased a home in the 80’s and haw a lot of equity. Make them take a 20% second, zero interest, to pay for you down payment.
If you don’t understand what I am talking about, then you have no idea what is going to happen over the next 5 years.
nanowest is right on the money…
its called — follow the bouncing ball
more job losses equals more foreclosures
equals more price declines
equals more foreclosures… the more job losses the
more fear spreads… the more fear spreads the less people
spend… the less people spend the more jobs are lost…
its self-perpetuating … down and down they go where they stop
nobody knows… as for my guess…1998
did anyone ever stop to ask where a government that
is already– for all intents and purposes- bankrupt–
going to get the money for more bailouts? and where
do the “bailouts” end.. these county workers certainly
will want their bailout money… and the hundreds of
thousands more that will soon be joining them too…
dont forget the homebuilders… car dealers…
and millions of small business owners… the list
goes on but my fingers are getting tired….
http://www.ocregister.com/articles/county-workers-berardino-2265881-wants-jobs
Nano West
Very interesting, I’m intrigued. Especially this part:
“Shane, if you are looking to by a house now, find someone that purchased a home in the 80’s and haw a lot of equity. Make them take a 20% second, zero interest, to pay for you down payment.
If you don’t understand what I am talking about, then you have no idea what is going to happen over the next 5 years.”
Can you outline what you think is going to happen over the next 5 years? I’m solidly bearish on our economy and housing prices, but you just out-beared me by far.
You are predicting hyperdeflation aren’t you? You are obviously predicting currency deflation greater than anything our nation has ever seen. The only way you get zero interest loans is during times of extreme deflation, right?
Brain,
After 10 years of hyper inflation in housing why would you be surprised to hear that we are undergoing a few years of substantial deflation. We had a ponzi scheme where a little bit of new money at the bottom created huge leverage in the entire market. In fact it may have been worse than your average ponzi scheme because people could enter the market with no capital at risk.
NW
I’m not surprised to hear about substantial deflation in housing prices. Looking at the case-shiller inflation-adjusted housing prices and comparing that to wages makes it extremely obvious that we are still outrageously overvalued in housing. Either (1) nominal housing prices will crash or (2) Hyperinflation will wipe out the real value of homes or (3) some combination of 1 & 2.
What surprises me is the thought of hyperdeflation of our currency. The thought of the zero interest loan was surprising. I’m not saying it’s wrong, just that I had not considered this yet. It seems that our government is so gung-ho about trying to get the hyperinflation ball rolling that eventually (a year or two down the road) they will succeed.
Check out that slope in the home price chart. That is a double-black-diamond slope! And the momentum keeps building, going straight down.