Friday, February 29, 2008

Los Angeles County South Bay Beach Cities Real Estate $$$ Transacted for February 2008

I have it on good authority from a client who works for mortgages at Wells Fargo that loan applications have been picking up since January - they have been "real busy" at her work. Both new applications and refis have been picking up, and my client and her husband may themselves take the opportunity to refi their own mortgage to take advantage of the coming higher conforming loan limit.

What sounds dicey at the moment is what that conforming loan limit will be. A February 22 L.A. Times story by Kathy M. Kristoff called "Jumbo rates still in the air" explains that although the stimulus package can boost conforming loan limits to as high as $729,500 in some areas, ultimately Congress left it up to HUD to determine what the conforming loan limit is going to be on a county by county basis. The stimulus plan was signed February 13 and HUD has 30 days from then to determine the new loan limits. The story speculates that HUD may boost the limit for Los Angeles from $417,000 to something like $572,000 and possibly $650,000 for Orange County.

When I first heard the $729,500 being tossed around, it made me think that a heck of a lot of properties for sale in Redondo could squeeze in under that number (note the recent price cuts to the new Ruxton Lane development, for instance). But under a limit of around $572,000, I'm not so sure.

What does seem pretty certain though is that there are sales waiting on credit market rules being finalized. How many of those loans will give a bong hit to Redondo Beach remains unclear.

Anyway, on to the charts. I think they almost speak for themselves. For the beach cities, dollar volume is up substantially YOY in 90245 (El Segundo) and 90254 (Hermosa Beach), and down substantially in 90266 (Manhattan Beach) and Redondo Beach (90277 and 90278). The down areas far outweigh the up areas.

Just to let you know, I do occasionally find errors on charts and fix them up without saying anything. 90274 YOY looks a little saner now. There was a data shift in the area charts that is now fixed. I've added zip code 90731 (San Pedro). Last month I fixed an error in Santa Monica. Etc, etc. However, no errors have really affected the direction of the trend, which has been down.

You can view a particular zip code through my regional tracker, and also my Google map tool.

YOY Comparisons

These numbers are a YOY comparison of the doubly smooth moving average of dollar volume charts. I think of them as "recent pain" (or recent gain) indicators.

Property sales and their realtors still on steroids...
90094        184.9% Playa Vista

Doing OK
90064          7.4% Rancho Park/Cheviot Hills
90501          3.3% Torrance

"I fell down down down in a burning ring of fire..."
90293         -7.8% Playa del Rey
90254         -8.5% Hermosa Beach
90245         -9.9% El Segundo
90045        -13.9% Westchester
90291        -21.5% Venice
90401-90405  -26.2% Santa Monica combined
90292        -26.5% Marina del Rey
90232        -28.8% Culver City
90036        -29.1% Park La Brea
90266        -31.8% Manhattan Beach
beach cities -32.5% 4 Beach Cities combined
90066        -37.6% Mar Vista
90504        -38.1% Torrance
90505        -38.3% Torrance
90034        -38.9% Palms
90501-90505  -39.8% Torrance Combined
90717        -40.7% Lomita
90008        -41.1% Baldwin Hills / Leimart Park
90277        -42.8% Redondo Beach (south)
90277-90278  -43.2% Redondo Beach combined
90275        -43.2% Palos Verdes Estates
90278        -43.6% Redondo Beach (north)
SW county    -44.3% Southwest L.A. County
90732        -47.6% San Pedro/Rancho PV
90056        -52.7% Ladera Heights
90230        -53.9% Culver City
90301        -54.7% Inglewood
90019        -55.0% Country Club Park/Mid City
90007        -55.8% South Central
90043        -57.5% Hyde Park, Windsor Hills
90503        -57.7% Torrance
90035        -60.3% West Fairfax
90746        -61.0% Carson
90016        -61.5% West Adams
90250        -64.5% Hawthorne
90304        -65.3% Lennox
90018        -65.8% Jefferson Park
90731        -66.6% San Pedro
90260        -67.3% Lawndale
90247        -67.9% Gardena
90047        -68.2% South Central
90062        -68.3% South Central
90302        -69.1% Inglewood
90301-90305  -71.2% Inglewood/Lennox combined
90745        -71.3% Carson
90044        -71.5% Athens
90249        -73.1% Gardena
90502        -74.5% Torrance
90037        -79.6% South Central
90305        -80.2% Inglewood
90303        -80.4% Inglewood
90744       -239.3% Wilmington

Relative Strength

This is a longer-term view of the strength of dollar volume in a given zip code. For this month 5.1 is the strongest (suffering the least amount of chronic pain) and -0.9 being the weakest (suffering the most chronic pain). Think of it is as the area above 0 on the YOY graph with the area below 0 of the YOY graph subtracted out.

90094         5.1 Playa Vista
90247         3.2 Gardena
90305         2.8 Inglewood
90044         1.8 Athens
90034         1.7 Palms
90746         1.5 Carson
90292         1.1 Marina del Rey
90047         1.1 South Central
90062         1.0 South Central
90301-90305   1.0 Inglewood/Lennox combined
90304         1.0 Lennox
90007         0.9 South Central
90502         0.9 Torrance
90018         0.9 Jefferson Park
90745         0.8 Carson
90301         0.8 Inglewood
90016         0.8 West Adams
90303         0.8 Inglewood
90250         0.8 Hawthorne
90302         0.8 Inglewood
90293         0.7 Playa del Rey
90501         0.7 Torrance
90732         0.7 San Pedro/Rancho PV
90037         0.6 South Central
90043         0.6 Hyde Park, Windsor Hills
90019         0.6 Country Club Park/Mid City
90064         0.6 Rancho Park/Cheviot Hills
90008         0.6 Baldwin Hills / Leimart Park
90254         0.5 Hermosa Beach
90291         0.5 Venice
90503         0.5 Torrance
90230         0.5 Culver City
90249         0.5 Gardena
90045         0.5 Westchester
90036         0.4 Park La Brea
SW county     0.4 Southwest L.A. County
90260         0.4 Lawndale
90501-90505   0.4 Torrance Combined
90245         0.3 El Segundo
90278         0.3 Redondo Beach (north)
90731         0.3 San Pedro
90232         0.3 Culver City
90066         0.3 Mar Vista
90277-90278   0.2 Redondo Beach combined
90401-90405   0.2 Santa Monica combined
90505         0.2 Torrance
beach cities  0.2 4 Beach Cities combined
90035         0.2 West Fairfax
90266         0.2 Manhattan Beach
90056         0.2 Ladera Heights
90717         0.1 Lomita
90277         0.1 Redondo Beach (south)
90504         0.1 Torrance
90275         0.0 Palos Verdes Estates
90744        -0.9 Wilmington

Tuesday, February 26, 2008

Macromarkets: Los Angeles area median housing price down -13.7% for December 2007

The Case-Shiller index was released for December 2007.

According to the index, the Los Angeles area median home price was down -13.7% from December 2006, and down -3.1% from November 2007.

To view the full report, visit Macromarkets (PDF file).

Saturday, February 23, 2008

CAR/DQNews January 2008 report for Redondo Beach

The following figures are from the California Association of Realtors (CAR) for January. CAR gets its figures from Dataquick. The CAR report is here.

The median price for a Redondo Beach home (new or existing, SFR or condo) is now $800,000 up +11.1% YOY.

My preliminary calculation came in at $795,000, based on 25 records. Luck! DataQuick had 39 Redondo Beach sale records.

For the four beach cities, DataQuick reports a median price of $1,065,000, up +16.27%% YOY, based on 63 sales.

For the South Bay area, DataQuick reports a median price of $612,500, up 0.41% YOY, based on 244 sales.

The median home price in the Westside is $1,628,000, up +96.74% YOY, based on 27 sales. West Los Angeles median price was $735,000, up +0.34% YOY, based on 95 sales. Palos Verdes Estates recorded a median of $1,855,000, up +21.44% YOY, based on 8 sales, and Palos Verdes Peninsula area recorded a median price of $1,190,000, down -2.06%, based on 27 sales. Malibu is up +16.81% at $2,450,000, based on 5 sales, while Beverly Hills is up +49.81% to $1,950,000, based on 11 sales.

I did notice some dollar volume rebound in many areas for January. This was probably driven in part by very high-priced property sales.

I continue to meditate on the meaning of "median" when sales volume has collapsed.

Friday, February 22, 2008

Still think Los Angeles is worth a premium in property values? Still think everybody wants to live here?

Wow, when I read the news, even I am amazed at all that negative stuff out there.

A prominent realtor here in the affluent beach cities recently said that he finds an abandoned pet dog at least once a month - a problem stemming from rising foreclosures and blight.

According to a February 22 story by Michael Rothfeld, Jessica's Law, originally passed to crack down on sex offenders, may now increase crime risks, as sex offenders are increasingly ending up homeless - gee, I wonder if the lack of affordable housing in California might have any bearing on this problem at all. There has been a 44% increase in sex offenders as transients in 15 months.

Now renters have a reason to grumble, because rents are spiking even as housing prices are falling. A February 22 story by Andrea Chang notes that Southern California rents have climbed an average of 4.5% in Q4 1007, when compared with Q4 2006. The unfortunate renter featured in the article grumbles that he feels like he's being forced out of Los Angeles.

While it won't help displaced renters now, I do think this rent spike will reverse itself. Some commenters on the L.A. Times blog explain. In places where the crash is "in full force", such as Riverside, rents are coming down. A lot of new property coming on line is going to end up as rental property. One commenter estimates 12-18 months before rents start following property prices down.

This next story is a doozy. According to this February 22 story by Richard Winton, Susannah Rosenblatt, and Andrew Blankstein about gang mayhem, the Avenues gang fought a gun battle with LAPD in the Glassell Park area for hours. That's probably not terribly surprising, but this piece on the L.A. Times titled "A drive-by, an AK-47 and SWAT: Welcome to your starter neighborhood" jolts us back into reality. Somebody wants $400,000 for a "starter" home in the neighborhood where this incident occurred.

$400,000 for a 572 sqft 2 bed 1 bath home in a neighborhood that police describe as a "base of operations for Avenues gang members". Residents ought to be getting combat pay and body armor, in my opinion.

We've read recently about the state's budget problems (link toward the bottom). Let's not forget that shit rolls downhill. The city of Los Angeles now wants residents to fix the sidewalks in front of their own houses when homes are sold. It's still just a proposal, but Los Angeles is revenue-starved. How many equally cash-strapped homeowners are going giddy with that idea?

And this is even before any recession *officially* starts. What's it going to be like a few years from now?

Something's up at 360 South Bay - and it isn't overpriced lofts!

I just got this mysterious e-mail:

Dear Susan,

Thank you for your on-going interest in 360 Southbay. We want to let you know that 
Sales opportunities are temporarily unavailable, but we are looking forward to 
reopening this cutting-edge community soon. Interest in this cool place to live is 
very high, but as a member of the current 360 interest list, you'll be among the 
first to be updated when sales resume. We look forward to welcoming you at 360 
Southbay again soon. 

I went to the William Lyon Homes website and was unable to find anything on the 360 Southbay project. I went directly to the 360 website, and found this note:

Thank you for your interest in 360 Southbay. Sales opportunities are temporarily 
unavailable while we give the market time to improve. We're looking forward to 
reopening this cutting-edge community and welcoming you again soon. There continues 
to be a lot of interest in 360. Be sure you're on the interest list and we'll keep 
you up-to-date so you'll know when these homes are available again.

It may not be new. I honestly don't know how long that note's been up.

I suspect that a lot of that interest they have in their project is similar to the interest that vultures have in dying animals and rotting carcasses. Good luck waiting for that improving market!

Thursday, February 21, 2008

Other measures of Los Angeles beach cities market activity, January 2008

Shorewood has published January statistics.

According to Shorewood, January average DOM for the four beach cities was 77 days, up from 65 in January 2007. My preliminary calculation for January reported a median Redondo Beach DOM of 107 days and an average DOM of 140 days. Although we can quibble over what time on market really means in terms of how a property is listed in the MLS, all measures of DOM appear to have risen for January YOY.

That looks like quite a leap up, though IF seasonality comes into play, I suppose we can expect DOM to dip as spring selling season heats up.

Supply Strength (Demand Weakness) took a spike up in January. This chart compares inventory to sales. According to Shorewood, there were 58 homes sold in the four beach cities in January, compared to 105 the year before. There were 539 homes for sale in January, compared to 510 the year before. So there was a slight increase in inventory YOY, but sales dropped considerably - by not quite 50%.

If you are new to this blog, know that I consider the top of the beach cities market, in terms of this measure, around May or June 2005, when inventory to sales was very tight.

In terms of technical/numeric indicators, I probably place more importance on this chart, on affordability measures (home prices in terms of homeowners' income), and on simply listing Zip Realty listings by asking price in ascending order, more than just about any other indicators, for evaluating market health.

The January median was $1,080,000, up 31.7% from $820,000 in January 2007.

Wow, get a load of that spike in median price. It almost looks like a double top forming, in stock market TA parlance. Or devil horns. Shorewood sounds a very hopeful note in their notes about how "inquiries" are picking up at their lending unit, and the firm believes that the increase in the conforming loan limit will "energize sales activity in the weeks and months ahead."

The $500,000+ market has particularly been hurting. If we see buyers flood back in to that market level, because now the properties are more "affordable" due to the increase in the conforming loan limit, then I would expect the resultant increase in sales to pull down the median price, as properties get marked to market on an increase in sales volume. We shall see.

The California Association of Realtors (CAR) and the L.A. Times (which depends on real estate advertising) are pulling out all the stops to boost the spring market. They are offering a free Home Buyers Fair in April, which might be amusing to attend, though I don't know yet if I can or will. They haven't yet stopped repeating the non-truth that buying a home "makes sense." They aren't anywhere close to losing hope. That tells me - we still have a LONG way to go...

Sunday, February 17, 2008

L.A. Times: Foreclosures lead to another problem: suburban blight

At first I thought this February 17 story by Chip Jacobs was a rerun of a story from last year, but not so! Blight, squatting, and rental fraud are apparently becoming hot topics.

I love this big burly realtor featured in this article - not many are gonna mess with him! He's been moving in to some of the foreclosed properties he represents, so that he can maintain them and keep out the riff-raff, literally. How many realtors do you know are willing to "go that extra mile?"

The problem is, there just aren't enough people like him to go around. Which kind of got me thinking. He is in effect renting the house from the lender who foreclosed the property. He's got an incentive to maintain the place because he wants to earn something selling the place. Given a rental situation, how does one incentivize the renter to maintain a place, instead of trash it? Maybe offer the renter a cut of the action when the place gets sold? That might work during boom times, but at the bottoms of the slumps, when everybody is pretty much assuming property prices will never rise, renters probably would figure their chance of a jackpot is too small to matter.

Studies cited in the article provided some interesting numbers. A study by the Georgia Institute of Technology and the Woodstock Institute of Chicago postulated that for each 2.8 foreclosures in a neighborhood with 100 owner-occupied homes, crime jumps 6.7%. The same researchers said that homes lose 0.9% of their value if they are within 1/8 mile of a foreclosure. Now I have images of Wile E. Coyote strapped to an anvil...

I should add, this time around, neighbors are being more proactive about foreclosure situations, unlike the early 90's. Some Homeowner Associations are hiring gardeners and repairmen to maintain landscaping, do minor repairs, and so forth, on neighboring empty homes.


Los Angeles Beach Cities Resale Activity for January 2008

Before I get on to the charts, you might want to visit Economic Indicators and ponder for a moment the "budgetary restraints" that would compel our Federal government to cease publication of economic statistics such as New Residential Sales, New Residential Construction, Personal Income and Outlays, and Gross Domestic Product (how can they not publish GDP?!?!?). I mean, I KNOW these numbers are bogus, but come on! Are the "budgetary restraints" an outcome of this stimulus package?

Then, you might want to cruise over to the L.A. Times and check out a February 16 story by Evan Halper called "California defers budget deficit". California is performing accounting maneuvers that would get a publicly traded company thoroughly spanked by the SEC and its CEO tarred, feathered, hot-iron branded on the butt as a criminal and permanently marked with a scarlet letter - that is - if he (or she) lives to survive the ordeal. The state of California is now "in the worst financial shape in years" according to the story.

My my, how quickly things have changed! Consider an L.A. Times article dated November 12, 2006, by Maria L. La Ganga and Scott Martelle, titled "California voters in a happy state - for the first time in years, exit polls show an electorate optimistic about the future". It contains social mood-marking tidbits such as:

Voters have approved a building spree that will fix schools, patch roads and provide
jobs for years to come.

And election day exit surveys by the Los Angeles Times Poll showed that nearly 
two-thirds of California's electorate thinks the state is on the right track — only 
the second time optimism has been so strong in the 15 years the poll has asked voters 
about the direction they believe California is headed.

"I guess it's going pretty good," said Melendez, 42, whose Hacienda Heights house has 
more than tripled in value since he bought it in 1997. "I love California."

Our social mood is undergoing a major shift. Our California experience from the early 90's clues us in as to what to expect, but since this economic reversal is of higher magnitude, in my opinion it's going to get much much worse than the early 90's.

Now, on to these bogus charts. I've reformatted the charts so that your eyes are drawn more to the moving average lines, which present a *somewhat* clearer picture than the raw monthly data. However, I continue to meditate on the meaning of "median price" on such low sales volume. It's a whole lot of nothing.

Here are the detailed RESALE statistics for the beach cities and some of the surrounding zip codes:

                         SFR   MEDIAN    %YOY    CONDO  MEDIAN   %YOY  
LA/Westchester    90045   15    $772     13.0%     2     $328   -30.2% 
El Segundo        90245    5  $1,200     58.0%   N/A      N/A     N/A
Hawthorne         90250   13    $450    -17.4%     3     $417    +4.5%  
Hermosa Beach     90254    3  $1,761    -25.4%     3   $1,490   +66.6%  
Lawndale          90260    3    $503    -12.5%     2     $473   +43.7%  
Manhattan Beach   90266   17  $1,575    +20.4%     1   $3,300  +116.4%  
Palos Verdes Pen. 90274    8  $1,855    +15.9%   N/A      N/A      N/A  
Rancho P.V.       90275   15  $1,330    +43.2%     7     $500   -10.7%   
Redondo Beach     90277   11  $1,070    +23.7%     9     $770    -2.4%   
Redondo Beach     90278   14    $758     +9.5%     6     $573   -14.5%

What MIGHT be of interest is my unresolved inventory snapshot for Redondo Beach from February 14. Remember, what I call "unresolved inventory" is all homes that have been listed for sale in websites such as Zip Realty, for which I have yet to find a sale record.

To the best of my knowledge, the median current asking price on all this unresolved inventory is $819,000, down from a median original asking price of $849,000. The average current asking price is $940,822, down from an average original asking price of $979,651. And if you recall, my preliminary snapshot of January sales for Redondo Beach showed a median sale price of $795,000 and an average sale price of $932,117. Those sales came with a median original asking price of $875,000 and average original asking price of $1,027,968. I'll summarize these numbers in a table:

        prelim Jan    unres inv
        median        median
        orig ask      orig ask
        $875,000      $849,000
        prelim Jan    unres inv
        average       average
        orig ask      orig ask

      $1,027,968      $979,651

        prelim Jan    unres inv
        median        median
        saleprice     current ask

        $795,000      $819,000

        prelim Jan    unres inv
        average       average
        saleprice     current ask

        $932,117      $940,822

As you can see, a gap is starting to open up again between recent sale prices and current asking prices.

The median PCTRED on unresolved inventory is 1.0%, while the average PCTRED is 3.4%. Compare that to the PCTREDs on January sales, with the median of 9.5% and the average of 7.7%. Notice that the original asking price numbers for unresolved inventory are actually LOWER than those for January sales. January sellers started off with higher asking prices and slashed more deeply.

Wednesday, February 13, 2008

Ruxton Lane saga continues

Long time readers may remember my visits to Ruxton Lane, starting from last September, to view the new developments there. Three of those units were presold. Well it turns out that not one of the remaining 24 units has been sold yet.

It was my impression that the layout (floorplan) of these units was better than most of the new construction I've seen. You can get a virtual tour here.

According to this February 12 post on Craigslist (link will expire):

Open House Saturday and Sunday 12-4PM!!!!!

One of 24 beautiful new Townhomes located in a great area of Redondo Beach. This home 
has 3 beds, 2.5 baths and 1906 SF. It is completely decked out with tons of upgrades 
and amenities included in the price, such as: Hardwood Floors, Stainless Steel 
Appliances, Wine Cooler, Granite counter tops, Crown Molding, Security Systems, AC, 
Fireplace, Cat 5 Wiring, 3 Car Garage and Spa Tubs. The floor plans are open and 
functional and the location is outstanding. Close to the beach, freeway and 
entertainment these Townhomes offer quality and convenience rarely found in LA.

Significantly, the prices started at $749,000 and now the low-end price has come down to $699,000.

DQNews: Southland home sales slowest for any month in 20 years

Well there you have it. January home sales in the Southland were bad. Really really bad. The lowest in 20 years, dipping below 10,000. DataQuick doesn't have statistics before 1988. Is it any wonder that the logic-free zone (Washington D.C.) is frantically trying to prop up this sinking morass?

The median home sale price in the Southland for January was $415,000, the lowest since $414,000 exactly 3 Januarys ago in 2005. That was -2.4% from December 2007, -14.4% YOY, and -17.8% below the peak reached in the spring and summer of 2007.

The 9,983 homes sold in the six-county Southern California area was -24.6% from December 2007, and -44.9% from January 2007. DataQuick is virtually throwing up its hands, unwilling to make any forecast (not that I blame them), unable to separate out the effect of lender and credit problems from other fundamentals.

The decline in the sales of homes financed with jumbo mortgages is particularly acute. Jumbo loan financings accounted for 18.9% of mortgage financings in January, down from 38.2% YOY. The median price of a home financed within the conforming loan limit (right now, $417,000), was $380,000, -5.0% YOY, and -7.3% from the peak in late winter-early spring 2007.

Mortgage payment commitments are interesting. The median monthly mortgage payment committed to in January is $1,889, down from $1,985 in December, and down from $2,263 one year prior. It is -25% from the peak in June 2006. Adjusted for inflation, the monthly mortgage payment is actually -14.5% from spring 1989.

DataQuick reports that foreclosures continue to be pegged at record levels, ARM and multiple-mortgage financing has dropped sharply, and non-owner occupied housing activity is flat. The firm continues to call other indicators of market distress "mixed."

Here are the Southland numbers:

County         # sold  # sold   % chg    med       med      % chg
                 2007    2008            Jan 07    Jan 08
Los Angeles     6,805   3,398   -50.1%  $520,000  $458,000  -11.9%
Orange          2,400   1,286   -46.4%  $600,000  $520,000  -13.3%
Riverside       3,089   1,939   -37.2%  $415,000  $331,500  -20.1%
San Bernardino  2,373   1,111   -53.2%  $370,000  $298,500  -19.3%
San Diego       2,772   1,826   -34.1%  $472,000  $429,000   -9.1%
Ventura           689     423   -38.6%  $565,000  $477,750  -15.4%
SoCal          18,128   9,983   -44.9%  $485,000  $415,000  -14.4%

Peter Y. Hong at the L.A. Times reports similar information in a February 13 story "Southern California home sales drop to 20-year low".

In terms of interesting statistics, Hong reports that the peak in monthly home sales occurred in June 2005, when 40,156 homes sold.

The stimulus package signed today temporarily raises the conforming limit to $729,750.

Realtors are reporting that some buyers are coming out of hibernation, with some open houses enjoying good attendance. Not many buyers are biting yet, though.

For what it's worth, I'm noticing a pickup in 90278 sales for February. If the trend continues, we could come pretty close to February 2007 sale volume. Currently 90277 volume remains very down, however. 90266 volume currently looks very down, 90254 and 90245 look like their sales volumes are picking up and could meet or exceed February 2007.

Monday, February 11, 2008

L.A. Business Journal: Housing Prices Fall Below Half-Million

According to the story by Daniel Miller in the February 11-17 edition of the L.A. Business Journal, the median home price in L.A. County dropped to $496,000, the first time it has been below $500,000 since May 2005. (I think this is SFRs and condos combined.) This is -9.7% from January 2007 and -3% from December 2007. The median home price hit a peak twice at $585,000 as recently as May 2007 and July 2007. According to Home Data, 3,379 homes were sold, a -38% YOY decline in sales volume.

Expert opinion is divided as to how deep the downturn will go and how long it will last. Mark Wollman at Hilton & Hyland sounds quite bearish when he says, "I think slowly but surely it is going to get worse...I think people are really going to start to understand what's happening this summer." Jerry Nickelsburg at the UCLA Anderson Business School is relatively optimistic, believing we'll see a bottom in mid-year, with the median -20% from the high. But prices are already -15% off the peak. He says it is "...significant that we went for a fair amount of time where the median price was not falling; it was rising in spite of the soft market...The market is finding its equilibrium."

The segment that appears to really be struggling is the midmarket - homes in the $500,000 - $1 million range. These are in the jumbo loan range. As things stand now, "I think it is going to struggle along for the time being...there are no indications the banks are going to loosen up" according to Mark Cohen of Cohen Financial Group in Beverly Hills. He was referring to the banks' current reluctance to make such big loans. Several believe that raising the conforming loan limit will be a "shot in the arm."

It is still a mixed bag in terms of what is happening in the most affluent areas. Manhattan Beach median price is up on a lower sales volume. Calabasas median is down on a slightly higher sales volume. Syd Leibovitch of Rodeo Realty sounds an optimistic note when he says "Prices have dropped so much that homes are a lot more affordable. I think we've hit the bottom...there are good deals." But Mark Wollman at Hilton & Hyland says he rejected three listings in December because the sellers had unrealistic expectations, and prior to December had rejected only one listing throughout his career. "I think a lot of people have not yet come to the realization that the market is slowing down and I also don't believe that a lot of homeowners understand that the lending instruments that were once available are no longer available. It's a very different ballgame now. If the buyer can't get financing, with all the great marketing in the world, the home is going to just sit."

The condo market is not getting whacked as badly as the SFR market. For January, the median price was $418,000, less than .5% from the median of January 2007, and down -3.2% from December. Sales volumes is down -18% YOY. Robert Kleinhenz, an economist for the California Association of Realtors, thinks condos have not been hit as hard because so many units are priced within the conforming loan limit of $417,000, thus making their purchase easier to finance. Condos in higher-end markets, though, have been getting hit.

-------------------------- SFR ----------------------------------
COMMUNITY          ZIP    Jan     %YOY        Jan    %YOY
                          Sales   Change      Price   Change
El Segundo       90245     10     +25.0%    $955,000  +20.9%
Hermosa Beach    90254     14      -6.7%  $1,110,000  -17.8%  
Manhattan Beach  90266     22     -24.1%  $1,730,000  +19.2%  
Redondo Beach    90277     13     +30.0%    $985,000   +6.6%
Redondo Beach    90278     11     -54.2%    $745,000  +14.6%

------------------------ CONDO ----------------------------------
COMMUNITY          ZIP    Jan     %YOY       Jan       %YOY
                          Sales   Change    Price     Change
El Segundo       90245     0      N/A        N/A        N/A
Hermosa Beach    90254     1      +0.0%    $969,000  +103.6%
Manhattan Beach  90266     3     -25.0%  $1,020,000   -10.4% 
Redondo Beach    90277     7     -50.0%    $770,000    +2.9%
Redondo Beach    90278    18     -21.7%    $690,000    +0.0%

The most expensive homes (I believe these are SFRs) in January were in Santa Monica 90402 (no change recorded YOY); Pacific Palisades 90272 (+72.3% YOY); Malibu 90265 (+36.1%); Beverly Hills 90210 (+16.8%); Beverly Hills 90211 (-37.9%); Bel-Air 90077 (+88.0%); Manhattan Beach 90266 (+19.2%); Brentwood 90049 (-8.5%); Venice 90291 (+54.6%); and Santa Monica 90405 (+25.4%).

The most expensive condos in January were in Santa Monica 90402 (no change recorded YOY); Torrance 90505 (+47.1%); Manhattan Beach 90266 (-10.4%); Rancho Park 90064 (+22.1%); Hollywood 90028 (+103.6%); Redondo Beach 90277 (+2.9%); Koreatown 90005 (+19.7%); Redondo Beach 90278 ( 0.0%); Marina del Rey 90292 (-21.6%); and Hollywood 90048 (-21.5%).

The areas with the greatest home price losses in January were Van Nuys 91405 (-32.6%); Harbor City 90710 (-32.1%); Palmdale 93550 (-32.1%); Lancaster 93534 (-31.1%); Palmdale 93552 (-29.8%); Long Beach 90804 (-29.3%); Sun Valley 91352 (-28.9%); Encino 91316 (-28.2%); Newhall 91321 (-27.9%); and Inglewood 90305 (-27.5%).

The areas with the greatest condo price losses in January were Long Beach 90805 (-56.0%); Civic Center 90012 (-43.7% - so much for those great downtown condos!); North Hills 91343 (-32.3%); Canoga Park 91304 (-32.1%); Canoga Park 91303 (-30.8%); North Hollywood 91602 (-30.6%); El Sereno 90032 (-30.3%); Sierra Madra 91024 (-29.8%); Van Nuys 91401 (-27.7%); and Agoura Hills 91301 (-27.5%).

I wonder how long it's going to take for the L.A. Business Journal and the L.A. Times to wake up and realize that their publishing of these median statistics is meaningless to the average Joe or Jill trying to sell their homes. For many zip codes the sale numbers are too small to reach any valid conclusion about median price. Second, all I have to do is look at Redondo Beach in Zip Realty to see that asking prices (and therefore, sale prices) have COME DOWN. It used to be that if you sorted the entries by ascending price, you almost couldn't find anything below $600,000. Currently, there are nearly 6 pages of entries below $600,000. This speaks volumes more about what's going on than the sale statistics on a handful of homes.

Friday, February 08, 2008

Preliminary look at January 2008 Redondo Beach sales

I am still scraping sale data out of the Manhattan Beach Reporter. I have pretty much given up on Zillow. (On a side note, I've been in touch with Zip Realty, telling them the problems I've had getting home sale data out of Zillow and Domania - who knows, maybe they will implement something!) MBR does not give exact sale dates so my estimates continue to fall on the first day of the reporting period.

I don't have enough records here for real statistical validity, so just keep in mind I'm doing the best I can with what I've got. The table below is my ongoing saga of estimates based on my SUPPLY (inventory) records:

STAT     JUL 2007   AUG 2007   SEP 2007   OCT 2007  NOV  2007   DEC 2007   JAN 2008  
records        78         51         68         44         37         26         25
MEDIAN   $860,000   $850,000   $857,000   $755,000   $832,500   $782,500   $795,000   
AVERAGE  $880,279   $867,925   $935,506   $770,416   $933,956   $832,827   $932,117
MIN      $359,000   $365,000   $369,900   $369,900   $379,000   $486,500   $449,900
MAX    $2,299,000 $1,510,000 $2,400,000 $2,560,000 $2,500,000 $1,500,000 $2,130,000

For January 2007, my calculated figures ran for 48 records, median = $724,500, average = $762,005, min = $389,000, and max = $2,100,000. So by my guesstimates median price is still up 10% YOY.

Of course, in a market where sales have been drying up faster than ice chips on black tar on a 100 degree day, who knows what "median" really means any more!

There's nothing unusual or different about sales by square footage. Median sqft has roamed around in the 1700-1900 sqft range, with averages maybe up to 200 feet higher.

Median DOM is 107 days - time on market roughly 3.6 months. Average DOM is 140 days, roughly 4.6 months.

Percent Reduction from original asking price (PCTRED) continues to creep up. If my sale records are totally correct, a few properties sold for a bit MORE than their original asking price, but overall, median reduction is 9.5% and average reduction is 7.7%.

Remember, we have to take these numbers in the overall context in which they occur. A rising percent reduction in asking price does not really indicate by itself that sale prices have fallen if homesellers are still looking for the dream prices of 2005 and 2006. And of course, a rising median price just gives homeowners a psychological "mark to model" gimmick by which they can continue to value their homes and pretend that their properties are still increasing in value, when the reality is that this theoretical rise is happening on terribly low volume.

Thursday, February 07, 2008

L.A. Times: Pets losing homes, humans in foreclosure

I've blogged about this issue before about pets being abandoned by homeowners who have been foreclosed upon - pets are a subject near and dear to my heart. This was definitely a forseeable tragic outcome to this housing debacle.

Here in Southern California, it is practically a sin to own a pet - you pay extortion fees in deposits and rent if your landlord happens to accepts pets. I really can't say I blame the landlords entirely because so many pet owners are so irresponsible. But responsible pet owners who socialize and train their dogs and take the time to learn to control their animals do not get any break in rent, whatsoever. Being a renter in a no-pets apartment, I can say that even if my landlady allowed pets, I could not responsibly own one, as the place is so small, and we spend so few hours home.

Anyway, here is the grim February 1 story by Martin Zimmerman. If you are in a position to take an animal and would like one, you'll probably find a greater and greater choice at your local animal shelter over the coming months. If you know somebody facing foreclosure and has been unsuccessful rehoming their pets, coax them into taking their animals to the local shelter. Between being abandoned in an empty house and starving, wandering the streets and risking getting hit by a car, or entering the chaotic environment of a shelter, the shelter is likely the best option. At least there is a chance the animal will get adopted, and if not, the animal will be humanely euthanized.

Tuesday, February 05, 2008

Los Angeles County South Bay Beach Cities Real Estate $$$ Transacted for January 2008

I am so sorry to be late coming out with January dollar volume numbers. I spent the weekend leafletting 2 precincts in 90045 for Ron Paul, and Monday evening leafletting my own precinct in 90278. Then today, I was hit by a car while crossing a street in Westwood, by UCLA. I am OK, but with a stiff left leg that has a big bruise on the outer lower leg, below the knee, and a scraped-up right elbow. I need to go to bed and get some rest.

Anyway, back to the numbers. Quite a few graphs are showing bounces off of December bottoms. The bubble has burst, and seasonality trends that would normally show that bounce around February are now being affected. The stock market has not been happy lately either. It is not clear how much further the decline in the financial markets may go. In any event, people are in somewhat glum moods at the moment, but that may change as spring rolls around...

The zip codes that remained pretty much even from January 2007, in terms of dollar volume, are 90016 (West Adams), 90035 (Fairfax), and 90245 (El Segundo). Zip codes where dollar volume was up substantially from a year ago are 90007 (South Central), 90034 (Palms), 90064 (Rancho Park), 90094 (Playa Vista - remains on steroids), 90291 (Venice), 90402 (Santa Monica), 90501 (Torrance - Village on Oak and Parkview Court), 90504 (Torrance), and 90505 (Torrance). Every place else was down in dollar volume.

Some of these higher dollar volume areas look weird. For example, Venice in January 2007 shows 19 transactions averaging $1,058,000. January 2008 shows 11 transactions averaging $2,362,000. So in some areas showing a bounce, there are still high-end buyers pushing up the numbers. Or, there could be something else going on, which I don't have insider knowledge of.

YOY comparisons

Remember, the YOY numbers are not taken on the raw numbers, they are taken on the doubly smooth 3 month moving average. They lag the raw data somewhat.

Realtors fat and happy... 90094 163.7% Playa Vista Not to shabby, considering... 90254 8.6% Hermosa Beach 90501 4.4% Torrance 90045 2.8% Westchester Slip sliding away... 90293 -4.2% Playa del Rey 90064 -5.9% Rancho Park/Cheviot Hills 90401-90405 -20.8% Santa Monica combined 90036 -21.3% Park La Brea 90266 -22.3% Manhattan Beach beach cities -23.4% 4 Beach Cities combined 90245 -24.1% El Segundo 90291 -25.0% Venice 90008 -26.2% Baldwin Hills / Leimart Park 90277 -27.6% Redondo Beach (south) 90232 -28.8% Culver City Sliding over a cliff... 90066 -31.2% Mar Vista 90277-90278 -33.2% Redondo Beach combined 90034 -34.2% Palms 90278 -37.4% Redondo Beach (north) 90501-90505 -37.4% Torrance Combined 90292 -37.4% Marina del Rey 90505 -38.2% Torrance SW county -39.3% Southwest L.A. County 90504 -40.3% Torrance 90275 -44.2% Palos Verdes Estates 90717 -46.1% Lomita 90503 -46.2% Torrance 90019 -47.0% Country Club Park/Mid City 90732 -47.1% San Pedro/Rancho PV Over the cliff, Thelma and Louise-style... 90230 -51.0% Culver City 90007 -52.4% South Central 90035 -53.4% West Fairfax 90301 -54.6% Inglewood 90304 -55.4% Lennox 90056 -56.6% Ladera Heights 90043 -57.6% Hyde Park, Windsor Hills 90250 -62.0% Hawthorne 90746 -66.6% Carson 90047 -67.3% South Central 90301-90305 -68.0% Inglewood/Lennox combined 90062 -68.2% South Central 90016 -68.7% West Adams 90018 -68.9% Jefferson Park 90260 -69.5% Lawndale 90302 -70.2% Inglewood 90745 -71.5% Carson 90044 -72.3% Athens 90305 -73.7% Inglewood 90502 -74.5% Torrance 90249 -76.5% Gardena 90303 -77.5% Inglewood 90037 -79.9% South Central 90744 -288.0% Wilmington

Relative Strength

This is a longer-term view of the strength of dollar volume, for this month with 4.9 being the strongest (suffering the least amount of chronic pain) and -0.6 being the weakest (suffering the most chronic pain). Think of it is as the area above 0 on the YOY graph with the area below 0 of the YOY graph subtracted out.

90094         4.9 Playa Vista
90305         2.9 Inglewood
90044         1.8 Athens
90034         1.8 Palms
90746         1.6 Carson
90292         1.5 Marina del Rey
90047         1.1 South Central
90062         1.1 South Central
90301-90305   1.1 Inglewood/Lennox combined
90304         1.0 Lennox
90502         1.0 Torrance
90007         1.0 South Central
90018         0.9 Jefferson Park
90745         0.9 Carson
90303         0.9 Inglewood
90016         0.8 West Adams
90301         0.8 Inglewood
90302         0.8 Inglewood
90250         0.8 Hawthorne
90293         0.7 Playa del Rey
90732         0.7 San Pedro/Rancho PV
90037         0.7 South Central
90501         0.7 Torrance
90043         0.7 Hyde Park, Windsor Hills
90019         0.7 Country Club Park/Mid City
90008         0.6 Baldwin Hills / Leimart Park
SW county     0.6 Southwest L.A. County
90064         0.6 Rancho Park/Cheviot Hills
90503         0.5 Torrance
90230         0.5 Culver City
90249         0.5 Gardena
90254         0.5 Hermosa Beach
90291         0.5 Venice
90260         0.5 Lawndale
90045         0.5 Westchester
90036         0.4 Park La Brea
90501-90505   0.4 Torrance Combined
90278         0.4 Redondo Beach (north)
90232         0.4 Culver City
90245         0.4 El Segundo
90066         0.3 Mar Vista
90277-90278   0.3 Redondo Beach combined
90505         0.3 Torrance
90401-90405   0.2 Santa Monica combined
90036         0.2 West Fairfax
beach cities  0.2 4 Beach Cities combined
90056         0.2 Ladera Heights
90266         0.2 Manhattan Beach
90717         0.2 Lomita
90277         0.2 Redondo Beach (south)
90504         0.1 Torrance
90275         0.0 Palos Verdes Estates
90744        -0.6 Wilmington