Ventura County Demand versus Inventory - October 2009

I have been a bit busier the last month or so and this chart was one of the casualties last month. This is the demand vs inventory chart for Ventura County current as of today. I split the chart up into Single Family Homes (SFH) and condos. Note the X-axis on the charts are different as is (unfortunately) the color coding so make sure to check the legend on the chart to orient yourself when you click to enlarge. As you can see inventory is very low on the low end. The huge number of contingents represent a lot of short sales just sitting their not being processed. The mid to upper end of the market clearly needs some adjustment and the low end is doing pretty well because supply is being choked off by various programs.

If there is a big need I can make the combined chart so people can compare todays demand to earlier months but this gives you the general sense of the market as we stand today. If I was a RE professional I would be thinking about what those charts represent.... Slower sales in the coming months due to low supply in the high demand segments.

Ventura County Demand versus Inventory - August 2009

This is August 2009 Demand versus Inventory chart for Ventura County. Demand continues to be concentrated on the lower end "affordable" areas with inventory in those areas being drawn down. Inventory is being built up in many segments of the $500,000+ market. This is a supply constrained market and while inventory is being cleared on the low end the higher end discretionary sellers are still waiting to find a buyer. I think the headlines of median prices rising because fewer low end homes selling because of the inventory shortage will embolden the higher end sellers to keep to their price and just ensure they will not sell. It does not look good for higher sales moving forward unless some more inventory comes online.

Ventura County Demand versus Inventory - July 2009

This is June 2009 Demand versus Inventory for Ventura County. I have broke down demand into 3 separate parts, Completed sales, properties under some sort of contingent contract and properties that have cleared contingencies and are waiting to close escrow. If you compare this months chart with last months chart we see demand pending/contingent demand starting to weaken further on the high end where it appears the seasonal rush is over. Inventory in the middle ranges looks like it is improving and the drops in inventory on the higher end appears to be sellers dropping price as the lower price points increase at the same time the higher ends decrease. It is clear all the major activity is on the low end but supply is still constrained. Buyers aren't able to push price and are just searching for deals wherever they can find them.

Ventura County Demand versus Inventory - June 2009

(click to enlarge)

This is June 2009 Demand versus Inventory for Ventura County. I have broke down demand into 3 separate parts, Completed sales, properties under some sort of contingent contract and properties that have cleared contingencies and are waiting to close escrow. With the spike in interest rates the large number of contingent properties are in danger of falling out if loan locks are lost and rates don't adjust back down. You can see that the $650,000+ market is still in much denial and the low end has a tremendous amount of activity. The story of the market going into summer is how much supply can be brought in on the low end and the pull through to closing on the large number of contingent contracts.

Ventura County Demand versus Inventory - March 2009

Here is an updated version of the chart I made in early January & late February comparing Demand and Inventory in Ventura County. Demand is defined as pending and contingent transactions and Inventory is active inventory. Please note if you are comparing the earlier January graph to this graph the scale on the left has changed due to increased inventory and demand.

I'd just re-read my comments from February the situation has merely gone down the same path since then. I wonder if we will start having inventory issues by mid-summer or if "shadow inventory" will save the day.

Ventura County Housing Inventory vs Demand

Here is an updated version of the chart I made in early January comparing Demand and Inventory in Ventura County. Demand is defined as pending and contingent transactions and Inventory is active inventory. Please note if you are comparing the earlier graph to this graph the scale on the left has changed due to increased inventory and demand.

We are seeing the increase in seasonal demand on the chart and the strength of the lower end though we are seeing demand outpace new inventory pretty much across all areas under a million. I think the housing credit is giving a temporary boost to demand which we will see come out in the sale numbers in April and May with a tempering of demand after then (my prediction). Inventory is being hampered by the foreclosure moratoriums, many which are lifted this next week but the new CA budget law 90 day delay will have an unknown effect. I think if distressed inventory continues to be hampered coming on the market we will see a sales slow down and the median price rise due to mix shift.

More on Demand vs Inventory for Ventura County

(click to enlarge)

This is a chart of demand versus inventory. I think because of slow processing times for loans and short sales overstates demand a bit at any one point in time. Right now we are at or near a seasonal low for inventory. Demand is clearly concentrated at the low end and based on sales this year which were at or near all-time lows for their perspective months throught the year we have further to fall. Based on volumes alone I think the low end will still decline significantly. Another thing is clear the above $600,000 market has a lot further to fall and should bear the majority of the price declines through this next year.

This is the Inventory and Demand broken up in deciles and the delta for each point in the market.

Ventura County home buying frustration.

(click to enlarge)

Here is an example of the huge divide between demand and supply. The chart above demonstrates the current count of single family homes either currently pending our under a contingent contract in Ventura County relative to their list price. The chart doesn't display any homes above $1,650,000 but those homes are factored into the data.

Here is the above chart broken down in Deciles, So 40% of pendings are below $319,900 and 80% of pendings are below $500,000. 90% of pendings are below $659,900.

Looking at inventory, 44.6% of inventory is above $659,900. So those 44.6% of sellers are fighting over a very small slice of demand. There is a clear mismatch between what the buyers can afford and what the sellers are asking for their homes. The median price home on the market is nowhere near what the median buyer can afford so many are choosing to sit on their hands instead of buy. The median buyer would have to either overpay for a median house or accept a lower quality house. It is clear in 2009 where the majority of price declines will be hitting and even potential 4.5% mortgage rates doesn't change the math very much. As we have seen with other charts the distressed sales are the ones finding the market. And it is clear the market is well below where a lot of sellers think it is.