Sunday, November 11, 2007

Preliminary look at October Redondo Beach sales, and sales and inventory snapshot for the year

Where are the high-end sales?

October 2007 sale records are in a dismal state, and I have low confidence in my numbers for this month. As the data is now, sale prices show a big decline, as do the median and average square footage. Given the rather chaotic nature of this market at the moment, I guess it's possible that prices really have undergone a dramatic decline, but my theory is that the sales data that has been initially reported for October is for the lower-end sales that have been clogged up in the sale pipeline due to mortgage acquisition problems and which are now completed, and that October sales reporting for the more problem-free escrows (high end) will come later. With sales so suddenly heavily weighted toward the low end I can't help but suspect there is either missing data, or the high end buyers have suddenly decided to pack up and leave town. So keep that in mind as you view these PRELIMINARY numbers (with extreme financial-stress outliers thrown out):

STAT     APR 2007   MAY 2007   JUN 2007   JUL 2007   AUG 2007   SEP 2007   OCT 2007      
records       114         91         62         78         51         68         37
MEDIAN   $799,000   $777,000   $764,500   $860,000   $850,000   $857,000   $730,000
AVERAGE  $884,271   $855,228   $830,711   $880,279   $867,925   $935,506   $716,062
MIN      $470,000   $453,000   $485,000   $359,000   $365,000   $369,900   $369,900  
MAX    $1,750,000 $1,640,000 $1,565,000 $2,299,000 $1,510,000 $2,400,000 $1,242,000 

So far I only have about 30 good sales in my SUPPLY records for October, so I won't put up charts for that data. However, median DOM for sales from these SUPPLY records is 95, average is 156, minimum is 33, and maximum is 525 days. Median seems quite consistent with what I've calculated for prior months (time on market = 3 months), but average has shot up, so we'll have to wait for more October data before we really know what's going on.

Remember my neighbors across the street? They have finally sold their townhouse for $890,000, which is down $9,000 paid for the place in late 2004, and down 25.8% from their original asking price of $1.2 million in August 2006. The place was tented for a day and somebody has moved in.

Now on to the outstanding inventory and sales for the year.

Before I give these figures, I should mention that over the past month I have made a concerted effort to resolve some of the outstanding inventory in my records, and I was able to. Thanks to the L.A. County tax assessor website, I resolved a lot of records, but the job is unfinished. In spite of that effort, I show the percentage of properties on the market for more than 240 days creeping up relative to percentages for shorter timeframes, so I still have some work to do. Also, remember that negative PCTRED means that occasionally houses are repriced higher than their original asking price, which still happens on occasion.

The following statistics are out of 810 unresolved inventory records (the August snapshot had 792 unresolved inventory records):

           Orig      Curr     Sqft   PCTRED     DOM    
           Ask $     Ask $
MEDIAN    859000    839000    1816     0.0      157
AVERAGE  1013708    981042    1935     2.9      190
MIN       373000    373000     410   -10.5        2
MAX      4990000   4990000    5100    28.8      679

For the 703 good sales from my SUPPLY records, through October so far (the August snapshot had 446 sale records):

           Sqft    Sale $     PCTRED    DOM
MEDIAN     1787    789000       3.4     100
AVERAGE    1837    846752       4.7     127
MIN         410    342500     -14.6      10
MAX        4700   2400000      33.1     573

Overall for 2007, median time on market is about 3.3 months, and average time on market is just over 4 months. Notice that for sales, which are successful transactions, there was a median percent reduction to asking price of 3.4% and an average reduction of 4.7%. For outstanding inventory, the median is NO reduction to asking price, with an average of 2.7%.

I was thinking of publishing charts of my August snapshot versus this November snapshot, but they can be misleading because I have taken steps to resolve some of the questionable inventory in my database since August, so the August data is biased that way. In the meantime, we'll just have to wait and see when more October sale data rolls in.

I will probably discontinue publishing data out of the L.A. Business Journal, for the reason that I now telecommute a lot, and the hard copy of the journal isn't as conveniently available from home.

New inventory is currently rolling in at the rate of about 2.4 properties a day.


Blogger bearmaster said...

I should add, current asking price is changing faster than I can keep up with it. Even after this post, I just went through about half the Zip Realty data for Redondo Beach and downwardly revised many asking prices.

It looks to me like more seller agents are getting their clients to agree that if no sales offer comes after X number of days (and that usually falls within a few weeks), the price gets reduced. No argument. Although I still see a few piddly markdowns of $4K to $10K at a time, I think I see more substantive markdowns - like, 5% or more at a time.

4:40 PM, November 11, 2007  
Blogger Rob Dawg said...

Good work.

Average BELOW median. There's a 2x4 across the forehead.

10:45 AM, November 12, 2007  
Blogger bearmaster said...

And so far for November, average home sale price is WAAAY up in both 90277 and 90278. Something is very lopsided here.

11:12 AM, November 12, 2007  
Blogger Swim Mistress said...

Really nice analysis of the market. Good work!

7:16 PM, November 14, 2007  

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