Orange County has the sixth-worst forecast of the nation’s 100 top housing markets, Fortune magazine reports.
The Fortune article says that the county’s 2008 median home price of $532,810 will fall 22% in 2009 and an additional 3.5% in 2010. More from the story:
“Of the 100 biggest markets, this Orange County area, which includes Anaheim and Irvine, was the fifth most expensive place to live this year. But in 2009, prices are forecast to decline by $121,000.”
The magazine rates Los Angeles as the nation’s worst market, with prices forecast to fall 24.9% next year. The other four worst markets and estimated 2009 decline:
- Stockton (-24.7%)
- Riverside (-23.3%)
- Miami (-22.8%)
- Sacramento (-22.2%).
To read the full story, CLICK HERE!
For more views on the housing market outlook, see our Eyeball 2009 housing forecast Q&As …
- 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
In other real estate news …
- Calif. home prices down 26%, nation’s worst — again
- New foreclosures dip, but delinquencies rise
- 8 million foreclosures seen through 2012
- Housing in O.C. beach towns slumps, sales off 28%
- O.C. real estate index takes smallest fall in 15 months
- Fountain Valley homes rank as easiest to sell
- Investors grab CEO job at O.C. homebuilder
- CA distress sales triple in ‘08
- Slump hits architects, billings at 13-year low
- O.C.’s newest beachfront listing: $36.9 million
- 1st home ($20 million+) hits O.C. seaside project
- New five-diamond golf resort is ultimate in indulgence
http://www.youtube.com/watch?v=MPBS7dVrE1U
Merry Christmas,
http://finance.yahoo.com/news/Home-prices-may-rise-on-rb-13912433.html
Merry Christmas to all, even PermaBulls and Realtors.
Regarding the list above. Sorry folks, The OC has home values that are higher than the other cities on the list. On a dollar basis, Orange County has, and will continue to lose the most money.
Meanwhile, buckle up and prepare to be re-calibrated … 1998 here we come! Yeah!
That would be awesome Lee. Then people in my generation will be able to buy homes from the Baby-Boomers and people in their parents generation. People in their 60’s now won’t have to sell their homes only to Chinese living in China.
Lee,
Since you’re the OC median expert, where did $532,810 median come from? I thought we’re already in 400-405 range?
Well, it looks like Santa Claus is bringing more home price declines for Orange County for 2009. You renters out there, things are looking good for you in the next couple of years.
Merry Christmas everybody.
In the best Christmas spirit, let’s take a moment to remember some of the casualties of this housing crash this year that is ending:
Seighburdud - Seeking Alfalfa - Thoughtful - Realtor Dave
I heard that they have relocated to Texas after loosing their homes to foreclosure. God bless them.
This is old news since the median is already down 20% from this outdated analysis. For those of you who are looking to purchase a home in the seediest parts of Santa Ana …………MERRY CHRISTMAS!
Santa Ana, Anaheim, etc. are very different than other OC cities. Don’t lump them all together.
The housing market won’t recover here in OC until all the people selling their homes realize it’s not 2006 and can’t ask for 800k for a small single family home.
Im not selling. Keep renting.
shockg is still in denial. Merry Christmas man and I hope you wake up some day.
As much as I used to respect the publication, Fortune is predicting that we will have measurements in 2009 that tell us what already happened in late 2008.
It won’t really be news except to them.
Let’s figure this out. Fortune is saying that by the end of 2009 the prices will be 22% lower than $532,810? That would be around $414,000. I thought our median is at $400,000 already. I guess even by their measurements we’re at the bottom, even beyond their 2010 projections!!
Well, there you have it !!!
This is a classic example of a misleading headline we see everyday about the OC RE market. Look out when people start to see right through these hidden agendas and start buying!!
People are buying, and loosing equity. Income, Price, Lending.
This story is another incentive to buy. Guaranteed loss.
Like others stated they are using wrong numbers. According to this we are at bottom.
helen/ truthiness/ whothehellever- why do insist on the new names?
we know its you as for bove- dick bove put a MARKET PERFORM
rating on bear stearns 3 days before it blew up– so please dont
give out his opinions unless you want to get death threats-
heres a great article on the feds follies- skip it shane it would just
go over your head–
http://market-ticker.denninger.net/uploaded_images/102707_2024_LettertoPre1-771948.png
Things will work out in the long-run, but we all have to tighten our belts and hold on for the next few years. I echo what someone said up above that our generation (those in their late 20s and so on who are starting families) can finally start buying homes at reasonable prices. It will also work to the benefit of the older generation of retirees who want to downsize and sell off their homes. House prices going down is a good thing, except for those who got caught up in the mania of the housing bubble, which I wish never happened. In 2004 when I was 24, I was about to buy a condo for $90,000 in Center City Philadelphia, but then I was laid off from my job. My career has never quite been able to pick back up since the layoff, but I guess I’m better off not having bought a place back then. Now I’m back in OC renting in the meantime…
anyone who thinks that this real estate market has bottomed
hasnt read about the history of manias and bubbles…
they are about to get an up close and personal real time
education on the subject….
U.S. Economy: Home Prices Fall Near Depression Pace (Update1)
By Bob Willis and Shobhana Chandra
Dec. 23 (Bloomberg) — Sales of single-family houses in the U.S. dropped in November by the most in two decades and resale prices collapsed at a pace reminiscent of the Great Depression, dashing speculation the market was close to a bottom.
Purchases of both new and existing houses dropped 7.6 percent from the prior month, the biggest decline since January 1989, to an annual rate of 4.43 million, government and industry figures showed today. A 13 percent drop in the median resale price from a year earlier was the most since records began in 1968 and was likely the largest since the 1930s, the National Association of Realtors said.
“Housing is still in a freefall,” said Nariman Behravesh, chief economist at IHS Global Insight in Lexington, Massachusetts.
The figures were worse than economists had forecast and signal that the battered housing market that led the economy into a recession may be taking another lurch down. Sliding property values mean more Americans will be under water on their mortgages, destroying household wealth and undermining consumers’ purchasing power.
President-elect Barack Obama plans an unprecedented economic stimulus to restore growth, and pledged on Dec. 13 to limit foreclosures. One tenth of U.S. families who own a home are in financial distress, Obama said.
“We need desperately to get this economy moving,” Vice President-elect Joseph Biden, who is leading the incoming administration’s initiative to bolster the middle class, told reporters before a meeting with Obama’s economic advisers today. Transition officials are “getting very close” to an agreement with lawmakers on the size of the stimulus, Biden said.
Below Estimates
The Realtors’ figures showed home resales, including condos, fell 8.6 percent to an annual rate of 4.49 million, below all but one estimate in a Bloomberg News survey of 63 economists. The median resale price dropped to $181,300.
Separately, the Commerce Department reported that new-home sales fell 2.9 percent last month to a 17-year low of 407,000. The median sales price declined 11.5 percent from a year earlier to $220,400.
The Standard & Poor’s supercomposite of homebuilder stocks fell 2 percent to close at 205.44 in New York, the fourth straight decline. The index is down a third so far this year. The S&P 500 Stock Index, which fell as much as 22 percent in November, dropped 1 percent today.
Buyers Scared Off
Last month’s stock market collapse combined with rising unemployment to scare off home buyers, Lawrence Yun, the Realtors’ chief economist, said at a press conference.
“The economy was really starting to feel the smack-in-the- face blow from the financial crisis” during November, said David Resler, chief economist at Nomura Securities International Inc. in New York.
U.S. household wealth already fell in the third quarter by the most on record, Federal Reserve figures showed earlier this month. Net worth for households and non-profit groups decreased by $2.81 trillion, the most since the Fed’s data began in 1952.
The number of previously owned unsold homes on the market at the end of November represented 11.2 months’ worth at the current sales pace, up from 10.3 months’ at the end of the prior month.
Foreclosures and short sales accounted for 45 percent of last month’s home purchases, Yun said.
Regional Breakdown
Purchases of total existing homes declined in all regions of the country, led by drops of 12 percent in the Northeast and 10.9 percent in the South. Prices also fell throughout the country, led by a decline of 25.5 percent in the West.
Resales account for about 90 percent of the housing market. Sales of existing homes are compiled from contract closings and may reflect contracts signed one or two months earlier. New-home sales, recorded when a contract is signed, are considered by economists to be a more timely barometer.
The hew-home sales report showed builders succeeded in trimming inventories even faster than sales dropped. The number of new homes for sale fell a record 7 percent to a seasonally adjusted 374,000, the fewest since February 2004.
The supply of new homes at the current sales rate dropped to 11.5 months’ worth from 11.8 months the prior month.
Resler said today’s figures show the housing market has “not yet seen any of the impact from the drop in mortgage rates.”
The Fed on Dec. 16 cut its benchmark interest rate target to a range of zero to 0.25 percent and reiterated it stands ready to expand purchases of Fannie Mae, Freddie Mac and Federal Home Loan Bank debt under a program aimed at reducing mortgage costs. That program has helped drive mortgage rates lower.
Mortgage Rate
The average rate on a 30-year fixed-rate loan fell to 5.18 percent in the week ended Dec. 12, the lowest in more than five years, according to the Mortgage Bankers Association.
Ara Hovnanian, chief executive officer of Hovnanian Enterprises Inc., New Jersey’s biggest homebuilder, called on the government to provide an economic stimulus for the housing industry.
“If government wants to get to the root of the problem they need to fix housing first,” Hovnanian said in a conference call on Dec. 17. Hovnanian, whose company reported a fiscal fourth quarter loss, didn’t specify what type of government intervention he wants in the housing market.
I am not sure of the value of looking at a report with a scope that includes the whole US - it does not make sense to do that for a report that has a scope of just the OC.
I am unsure of where Fortune got their numbers- the data is aged or maybe has a focus on the more pricy zips. For example this prediction might make sense if we look at 92679 (staying slightly inland from the beach so the bears to not freak):
January $735
February $820
March $717
April $850
May $745
June $765
July $722
August $815
September $640
October $650
November $615
December $725
Ignoring that the median is basically flate for the year andis clearly dependent on the mix, I would say that there is room for another 10% or so drop - if you ignore the fact that the month to month sales volume is steadily increasing with the current pricing - about 19% over last year and the median has spiked.
Let me give everyone some common sense advise. Don’t let clowns advise you on how to invest or manage your money. Realtors and real estate agents, just like financial advisors, are a bunch of quacks. Why isn’t anyone holding these clowns accountable for the extremely bad advise they gave. The only purpose of realtors is to artificially inflate real estate prices to assure themselves greater incomes. Didn’t realtors advise the buyers of the overprised homes? Are they licensed? What’s the real function of their license if there is no accountability?
Just like financial advisors will freely gamble with someone elses money and take no accountability for any losses.
I’ve always believed that you should’n't allow anyone, I mean anyone, to manage or advise me how to invest.
Fortune Magazines 2008 stock picks performed worse that the overall S&P 500 for 2008… All that so called knowledge and that all you could do… hum .. Do you think I believe there picks for Real Estate in 2009…
NO !!!!!! We will see a bottom in 2009 !!! That advice is free !!!
Throwing more taxdollars at the problem will only worsen it. The more we grow the deficit the less we will have to grow the GNP. Our % of debt to GNP has grown astronomically in the last 8 years. The more we have to service the debt associated with the deficit the less we have to spend on production. The ONLY way to dig ourselves out of this deep hole is to FORCE the banks, investment houses, insurance companies and other financial institutions to open their books, expose and default on their bad debt. Sure, that will cause some short term pain but the road we are on now leads to nowhere. The longer this process is delayed the longer and more intense the pain. If they stay on course we are looking at an economic depression. 30% unemployment, no credit, unstocked supermarket shelves and martial law. Hope for the best and expect the worst!
oc observer- you took the words right outa my mouth–
Hey Rants,Why don’t you nibble the walnuts off my holiday cheese log.
The Fortune median price of $533k is for Single Family Home. The current $400k median price published by the Register includes Condos.
helen try this for your next name- helenunderwater- its more
appropriate
Rants the only thing underwater about me is my opinion of low life pinheads like you
If you are scoring at home…..
rants - 1
helen underwater - 0
KP, who are you, Rants’ butboy?
Wow! Someone is touchy. Someone is underwater, but I don’t think you should take it out on those on this website. People have been warning about this bubble for years. I knew something was wrong when I saw my home price increase 30k a month. That’s crazy and I knew it was unsustainable.
ocobserver nailed it. The man speaks the truth. We are in a path to destruction if we continue this path to try to keep inflated home prices up. The best is to take the hit now and let prices come down to where they are supposed to be, and we can build a stronger foundation to move forward. Govt intervention to prevent this will only make the pain last longer. Very low interest rates and buying on credit is one of the major problems we got into this mess. Govt is trying to fix this problem by lowering the interest rates to record low and throwing more money at he problem on credit. This doesn’t look good. Be defensive.
Buy the dip, you don’t crap about anything so shut up