L.A. Times: Plunge in Sales of Existing Homes in California Largest Since August 1982

In a September 25, 2006 L.A. Times article by Jesus Sanchez titled U.S. Median Home Price Suffers First Slip in Ten Years, it is noted that California existing home sales volume in August has suffered its biggest YOY drop in 24 years. Existing home sales have fallen 30.1%. In August 1982, sales tumbled 30.4%.

At least Leslie Appleton-Young of the California Association of Realtors (CAR) is hedging her bets now when she notes that some California regions have experienced YOY declines now for more than two months, and that the longer-term trend "remains to be seen."

Is David Lareah of the National Association of Realtors (NAR), rewriting history when he claims that, on a national level, the YOY median price decline of 1.7% for existing homes is the decline "we've been expecting" ? Then he goes on to say sales are stabilizing and "we should go on to positive price growth early next year."

Other analysts are rightfully sceptical. High Frequency Economics notes that "...the speed of the collapse has been astonishing. With inventory rising, there is no chance of any short-term relief. Prices and volumes have a long way to fall yet."

FYI: CAR is holding its 2006 EXPO at the Long Beach Convention Center October 17-19.

Anecdotally: Last night I went through my drawer of real estate flyers for my area (Villas North section of north Redondo Beach) and out of curiosity thought I would make sales price notes on them so I could compare asking prices with sale prices. I did not count the flyers but estimate maybe two dozen. The flyer geographic distribution is admittedly rather lopsided, without adequate representation of all the streets around here. I've been tracking sales statistics through Melissa Data but I still have to say I was astounded that of all these properties, only about 3 had sales recorded for them. The remaining twenty or so properties had no record of a recent sale in Domania or in Zillow. Most of these flyers are several months old. That tells me that either tons of listings are still ongoing after many months or that a number of sellers gave up earlier this year trying to sell their homes. It's probably a mix of those two factors but since inventory has recently dropped slightly I am inclined to think the latter weighs heavily in that mix. So what will next spring be like? Will the sellers who gave up trying to sell last spring try again next spring, adding to a pool of new sellers who are trying to sell their properties for the first time? Will I see forests of For Sale signs reminiscent of what I witnessed in Lomita in 1989-1990?