Click to enlarge

Orange County housing affordability was 3rd worst in the nation in the third quarter, according to the latest National Association of Home Builders/Wells Fargo “Housing Opportunity Index.”

HOI showed that 37.6% of all new and existing Orange County homes sold in the third quarter of 2009 were affordable to families earning the local median income of $86,100. How’d that rank?

• That’s the second consecutive drop in local affordability after three years on the upswing.
• 3rd worst among the major markets followed.
• Prime reason for falling local affordability? Rising prices! By the HOI math, local prices were up 5% in the quarter and 3% higher that a year ago.
• And local incomes, by the way, haven’t budged in six months!
• Worst than us? New York and San Francisco.
• Most affordable? Indianapolis, for the 17 consecutive quarter.

Nationally? HOI showed 70.1% new and existing homes sold in Q3 were affordable to families earning national median income of $64,000 vs. near-record 72.3 percent in q2.

FYI: HOI measures percentage of homes sold in an area that are affordable to families earning that area’s median income during a quarter using data from, among others, First American Real Estate Solutions and Federal Housing Finance Board.

Real estate outlooks:

Post from: Lansner on Real Estate

Other highlights of the full report (FULL COPY HERE) …

• Nationally, fewer than half  — 49% –  believe their home’s value decreased over the past 12 months. Actually, 72% went down.
• U.S. homeowners were  more optimistic about the future of their own homes’ values than at any time in the past 6 quarters.
• A full 41% say their own home’s value will increase in the next 6 months. An additional 43% say their home’s value will remain the same, with just 17% saying their home’s value will decrease.

“Consistent with all previous surveys, homeowners also seem to be overly optimistic about future home values,” said said Zillow Chief Economist Stan Humphries. “While we have definitely seen some stabilization in recent months, there is a high likelihood that home values will see further declines driven by an increasing number of foreclosures coming into the market and, possibly, rising interest rates after the first quarter of next year.”

Let’s take our own poll.

Other tales by Marilyn Kalfus:

.

Post from: Lansner on Real Estate

Local renters’ costs fell 0.1% last month vs. October 2008. Last such SoCal decline? A similar size drop in November 1995.

Renters weren’t the only housing winners in the CPI report:

• Homeowners equivalent inflation rate (purchase costs not included), fell at an 0.7% annual rate in October. That’s biggest SoCal drop since June 1995.
• Household energy costs in SoCal fell at an 0.7% annual rate in October.Actually, that’s the smallest drop in a string of declines that dates to last November.
• Household furnishings and operations fell at an 2.5% annual rate in October. That’s biggest SoCal drop since April 2008.
• Overall, SoCal housing inflation fell at an 0.6% annual rate in October — fourth consecutive drop and biggest since June 1983.
• As for the big picture, SoCal total inflation rate for all goods and services fell at an 0.4% annual rate in October. It’s the eighth consecutive drop — but that smallest in that string.

Rental trends:

Post from: Lansner on Real Estate

The gains were driven mainly by monthly price jumps in just two of the six counties in the region: Orange and Riverside.

On an annual basis, the median SoCal price was down 6.7%, but DataQuick reported that that was the smallest drop in two years.

Sales picked up, too, with monthly gains reported in four of the six counties. The counties with monthly price gains – Orange and Riverside – also had monthly sales drops.

DataQuick credited government intervention for playing “a huge role in stabilizing and, to some extent, reinvigorating the housing market.”

Increased FHA lending, tax credits and political pressure on lenders to reduce foreclosures helped ease the housing slump, DataQuick said. Whether those gains will continue after federal support is reduced in a year is still open to debate, the housing research firm reported.

Other real estate trends:

Post from: Lansner on Real Estate

_

WHERE DID THEY BUY IN OCTOBER?
(Click image for details!)

$335,000

$500,000

$1,130,000

• Shoppers bought 2,800 residences — that is -1.2% vs. year-ago buying activity. (From 1997-2006, monthly sales averaged 4,304 per month.)
• That ends a 15-month streak of sales year-over-year gains after 33 consecutive months where sales failed to beat the previous year’s pace.
• Why? Relative bargains are hard to find. October’s $436,500 median selling price, highest since August 2008 and +3.9% vs. a year ago.
• Second consecutive month of year-over-year pricing gains.
• The most recent median is also 18% above the cyclical low hit in January 2009 at $370,000!
• Prices have now risen month-to-month for 6 straight times — longest streak since 7 months ended August 2005.
• 25 O.C. ZIPs have both price AND sales gains.
• Yes, current pricing is 32% below June 2007’s peak of $645,000. And the January bottom was -43% below the peak.
• Prices fell on a year-over-year basis from Sept. 2007 through August. (Worst at -31.5% in August 2008.)
• Single-family homes resell for 33% less than their peak pricing (June ‘07) while condos sell 33% below their peak in March 2006. Builder prices for new homes are 35% below their February ‘05 top.

Real estate outlooks:

Post from: Lansner on Real Estate

So would you make the move? We don’t know what a spouse, child, significant other or various relationships might suggest, but we know what your wallet would think long and hard about it!

We quickly noticed that the housing market back there was perking up! Nashville Business Journal reports that Nashville home sales are climbing for the first time in three years as the median selling price for a single-family was … gulp! … $160,000. Psst! It’s a half-million here!

Then we went to Money magazine’s “How far will my salary go in another city?” city-cost calculator and got these results …

• $50,000 of salary in O.C. equals $30,554 in Nashville
• Nashville groceries will cost 9% less vs. O.C.
• Nashville housing will cost 71% less
• Nashville utilities will cost 4% more
• Nashville transportation will cost 14%less
• Nashville healthcare will cost 21% less

Just to be sure, we checked in with Sperling’s Best Places comparison tool and got …

• A salary of $50,000 in Orange, Calif., equals $30,155 in Nashville
• Nashville 40% cheaper than Orange.
• Housing is the biggest factor in the cost of living difference. Housing is 62% cheaper in Nashville.

Imagine if you have to make the call …

Post from: Lansner on Real Estate

• Shoppers bought 3,082 residences — that is +9.2% vs. year-ago buying activity. (From 1997-2006, monthly sales averaged 4,304 per month.)
• Assuming the month finished at the last reported sale space, this would be the most active October for local homebuying since 2005!
• September was 15th straight month of sales gains vs. the year-ago period. That follows 33 consecutive months where sales failed to beat the previous year’s pace.
• In this most recent period, O.C.’s $435,000 median selling price is +4.8% vs. a year ago … yet 33% below June 2007’s peak of $645,000.
• The most recent median is 18% above the cyclical low hit in January 2009 at $370,000 — a current bottom that was -43% below the peak.
• Prices fell on a year-over-year basis from Sept. 2007 through August. (Worst at -31.5% in August 2008.)
• Single-family homes resell for 33% less than their peak pricing (June ‘07) while condos sell 34% below their peak in March 2006. Builder prices for new homes are 41% below their February ‘05 top.

Other real estate trends:

Post from: Lansner on Real Estate

PMI uses various economic and real estate factors — from employment to pricing trends to broad business climate trends — to compare various markets. So PMI’s study tracking the 50 largest U.S. metro areas puts Orange County real estate in a noteworthy, national perspective …

• Risk? 99.9% chance of home prices falling in next two years. That score tied Orange County with eight other markets for the the crown of “nation’s riskiest!”
• OK. You ask … “The other 8?” Nearby Inland Empire and LA; an I-15 drive away, Vegas; and 5 Florida markets (Miami, Fort Lauderdale, Tampa, Jacksonville and Orlando!)
• Pricing? Orange County values fell at a 7.81% annual rate in Q2, that’s 14 percentage points better than Q1. That’s the biggest improvement among the top 50 markets tracked by PMI.
• Affordability? Orange County buyers found a harsher market, by PMI’s math, in Q2 vs. Q1 as local affordability ran 19% below the top market’s average.
• Jobs? Orange County unemployment was not helping as Q2 local joblessness (8.8%) was 3.7 percentage points above the 5-year average. Top markets average ran 3 percentage points above their respective 5-year trend.

And nationwide? PMI concludes …

• “Appears that risk may be close to peaking.”
• Risk increased in just 55% of all-size markets tracked (384.)
• Average risk rose to 51.6% from 50.3%, an increase much smaller than in previous quarters.
• Of the 50 largest markets, 19 were in the moderate, low, or minimal risk categories.
• Markets in California, Nevada, Florida, and Arizona continued with high risk as did markets with high unemployment (such as Detroit.)

Big real estate woes:

Post from: Lansner on Real Estate

• Home price in the West up 2.1% in the last 3 months vs. the previous same period, smallest gain of Clear Capital’s 4 slices of the nation. (U.S. gain in the period? 3.7%)
• Same trend when looking at past 6 months vs. previous half year: West up 3.3%, lowest of the 4 slices and below the 9.1% national gain.
• As for year-over-year, no surprise: West trailed the pack … down 14% — worst of the foursome — and trailing the national 8.4% decline.
• All the regional numbers are in the map at right!

Says Alex Villacorta of Clear Capital. “As we’ve seen since the spring season, many markets have returned to traditional seasonal fluctuations and the strong summer gains are showing signs of slowing. … The continued decline in REO (foreclosure) saturation rates, as well as an increase in the proportion of cash buyers in both distressed and fair market sales, are an encouraging sign of investor optimism coming into the traditionally slow months.”

Real estate outlooks:

Post from: Lansner on Real Estate

• DataQuick identified 506 homes selling in beach cities’ ZIP codes last month, +27% from a year ago. Median selling price? $693,500 in these 17 ZIPs. Last month’s median price change was -6.3% vs. a year ago.
• South inland ZIPs — median selling price $516,250 – had 830 sales, +20% from a year ago. In these 19 ZIPs, last month’s median price change was +3.6% vs. a year ago.
• North inland ZIPs — median selling price $455,000 – had 799 sales, +11% from a year ago. In these 23 ZIPs, last month’s median price change was -4.6% vs. a year ago.
• Mid-county ZIPs — median selling price $351,000 – had 909 sales, -8% from a year ago. In these 24 ZIPs, last month’s median price change was -1.3% vs. a year ago.
• All told, countywide sales were +5% vs. a year ago. The median selling price was +4% in the past year.

How did your neighborhood fare? Check our ZIP-by-ZIP data HERE!

Other real estate trends:

Post from: Lansner on Real Estate

For the 22 business days ending Oct. 16 – DataQuick’s latest homebuying report — Orange County saw …

• $435,000 median selling price that is $6,000 above September (+1.4%) and would mark the 6th consecutive month of price gains — longest winning streak since 7 up months ended Aug. 2005.
• Price is +3.6% vs. a year ago and -33% below June 2007’s peak of $645,000.
• The most recent median is 18% above the cyclical low hit in January 2009 at $370,000 — a current bottom that was -43% below the peak.
• Prices fell on a year-over-year basis from Sept. 2007 through August. (Worst at -31.5% in August 2008.)
• Single-family homes resell for 33% less than their peak pricing (June ‘07) while condos sell 34% below their peak in March 2006. Builder prices for new homes are 42% below their February ‘05 top.
• In this most recent period, O.C. shoppers bought 3,103 residences — that is +4.8% vs. year-ago buying activity. (From 1997-2006, monthly sales averaged 4,304 per month.)
• September was 15th straight month of sales gains vs. the year-ago period. That follows 33 consecutive months where sales failed to beat the previous year’s pace.

How did your neighborhood fare? Check our ZIP-by-ZIP data HERE!

“Other real estate trends:
”

Post from: Lansner on Real Estate

Coldwell Banker Real Estate every fall has a little fun with the real estate data, digging into the numbers to create its “College Home Price Comparison Index” to track comparative house-buying costs in various college towns in big-time football leagues. Benchmark residence for the study is a single-family, 2,200 square-foot house with four bedrooms, two and one-half baths.

The Pac 10 conference — home to USC and UCLA football — had the priciest housing. Here’s the rankings, sliced by the major conferences, based on the average selling price this year …

1. Mid American: $182,322
2. Conference USA: $210,882
3. SEC: $222,479
4. Big East: $237,366
5. Sun Belt: $242,213
6. Big 12: $244,431
7. Mountain West: $251,876
8. Big 10: $279,787
9. WAC: $356,528
10. ACC: $378,062
11. Independent: $411,444
12. Pac 10: $747,180

Other findings …

• Cheapest college town? Akron, Ohio (U. of Akron) with a typical cost of target home was $121,885.
• Priciest? Palo Alto (Stanford U.) at $1.49 million.
• 2nd priciest? LA (UCLA and USC) at $1.35 million.

Real estate trends:

Post from: Lansner on Real Estate