Other measures of beach cities market activity, April 2007

Shorewood has published April numbers, and I'm afraid the format they published in is a disgrace. I have already contacted Shorewood to ask them why the numbers aren't in a table like in all their other monthly activity reports. As it stands now, I have to make guesses about inventory, which I can correct in a future report.

The average DOM for the beach cities, by Shorewood's calculations, is 51, which is well up from a year ago. I have not had time to run DOM numbers on what I've tabulated for Redondo Beach sales, but my initial impression is that I am surprised this hasn't fallen a little lower, because many properties have been listed and sold relatively quickly this year. It's the properties whose owners got caught at the top and who resist lowering their prices that are not selling and accumulating horrifically long DOMs.

Things are rather interesting now because there seem to be two levels of consciousness running through the market - the "I absolutely refuse to lower my asking price" train of thought versus the "I'm pricing this competitively, just get me out now" train of thought. Guess which homes are spending less time on the market. If and when that nasty slump that many realtors are pretending never happened comes back, these conflicting modes of thought are bound to create some fireworks. And I see no reason why that slump shouldn't come back. Realtors have been calling the market in the years prior to 2006 "healthy", when it was anything but - fueled by speculation and shaky loans.

My measure of supply strength (demand weakness) is estimated this month since Shorewood has not published actual inventory numbers, only months of supply. I took a wild-ass guess at inventory and charted the I-S/S ratio. By this measure much lost ground has been regained. However, I've been noticing in May that the gap between new inventory coming to market and homes getting sold has narrowed substantially. If I am wrong about a resumption of the slump, and the recovery continues, then we'll know we're in full blown mania mode (and buyers wiill be at an even greater disadvantage) again when this ratio is within a few hairs of 0.

I consider Shorewood's tracking of median price more reliable than the breakouts by DataQuick. Overall, prices are slightly down from a year ago - not enough to make a substantial difference to a frustrated potential buyer.

In other words, it's the same old, same old. Oversized bloatominiums are still selling. Last week I talked to some neighbors who mentioned friends who were saving their money with plans to leave the state. I certainly don't blame their friends.