Dataquick reported home sales for Ventura County for November 2009 today. Home sales came in at 752 up 3.2% YoY. The median sales price came in at $365,000 up 2.8% YoY and flat MoM. This months activity was pretty easy to predict based on the expectation that the tax credit would expire coinciding with ultra low interest rates. We now get to see how much demand was pulled forward. Historically for Ventura County sales go up from November to December. It is extremely clear this year that will not be the case, I am predicting DQ reporting sales of around 700 for December (and I believe I am being optimistic) which would be a 20% drop YoY and 6.9% drop MoM. Both highly unusual occurrences.
We also have Fannie Mae's underwriting change (lowering DTI to 45%) coming into effect just the other day. Lucky for agents Freddie has yet to tighten similarly, so those marginal conventional deals might just be delayed rather than blown up completely. The 10 yr note has also been rising lately and the Fed is lowering its MBS purchases. All of this combined with the low market inventory will mean 2010 will be a very slow sales year unless a miracle happens and more inventory comes on market. The only hope for that would be large number of short sales or foreclosures as they are really the inventory that will be enough to keep sales up.