Here is the San Fernando Valley:
Here is Ventura County:
You can see the banks continuing to stay motivated and push inventory as much as possible and we may see distressed sales hit 2/3 of all sales in Ventura in December. An amazing statistic. Also as I have mentioned before I think distressed sales are underrepresented because some agents do not set the proper flags for foreclosure or short sale.
Anytime you hear how "great" sales are in a news article just remember that they would simply be horrible if it wasn't for the banks staying motivated. In the context of these numbers traditional metrics like months supply of homes means little. The banks are intentionally pricing low to reduce time on market. Months supply will drop as a result of this but it isn't an indication of strength. Inventory on the market should continue to drop as discretionary sellers recognize the bad market conditions and give up even though a sale now will probably net them more than a sale in the next few years.
5 comments:
I think that one of the most interesting statistics here is the month-month decline in overall sales. It IS very drastic.
There is a couple different variables for the MoM changes. There is some late reporters still unaccounted for and Seasonality.
That said sales are still weak and are only this "strong" because the banks are staying motivated and continuing to drop prices.
December looks ugly so far but the late reporting issue always makes the beginning of the month look bad.
Perhaps it's time to pick a nice place and go in with an 80% low ball offer?
What do you think? Still too early for that?
I've been thinking about doing that since my wife (and I) may possibly be actually able to buy a place that is reasonable now.
But STILL, prices of homes (i.e. SFR's) is still too high IMO. A nice house in Glenda;e/Pasadena is still going for well above $500K and that's simply too much for what you get.
What do you guys think? Low ball time?
Noz,
80% is a tough one, It only really happens on homes in the margins (homes with some sort of defect or very high priced homes where the market is small). It isn't impossible but it is a very low probability event.
Once a home you like gets within 95% of your price range and the seller pays closing costs that brings you into the high probability of getting an offer accepted. For foreclosures its a bit tougher because they tend to underprice the homes relative to the market to generate offers and lower time on market. You can get deals, it happens all the time, it's just something that would very discouraging for some buyers. Most buyers choose "their" home, in finding a deal you kind of choose multiple homes which fit your parameters and are acceptable to you and then go out and lowball.
Short sales have the fewest bids at the lower priced range because people don't want to go through the hassle. But if you have time to wait and can deal with some frustration there are some nuggets to be found. You don't have a "natural" enemy in the seller, they just want out and sometimes the banks will try for more (counteroffering) but accept the fact that they don't really need another foreclosure on the rolls and whatever they get now will probably be more than what they get later.
Interesting take ED.
I guess the prices will need to come down more for the target price I'm looking at. Prices around here are still far to high and frankly I think an 80% offer would put them in the range which I believe they are worth not more than.
I'm not sure of the prices will come down that far. But from the looks of how bad the economy really truly is, I'm thinking they will...and even though my job is also on the line, I'm hoping the factors take us there. We just need to flush out all the crap before we can get back on our feet and move forward.
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