Thursday, July 31, 2008

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

Shorewood has graciously sent me its June statistics.

According to the realty firm, the average DOM for sales in the four beach cities was 53, which is the highest June DOM since I've started keeping track of Shorewood's DOM numbers, which go back to July 2004.

My calculation of DOM (time on market) for Redondo Beach starts the counter from when a property is first listed, not from its last relisting before it is sold. So my calculations for June were a median 127 days and an average 182 days. If you check my prior postings, you'll see that there are really "two markets", with one set of sellers pricing aggressively and selling relatively quickly, while another set of sellers lets their properties sit on the market, for literally years. My calculated median and average fall in the middle of the extremes and probably aren't representative of the experience of your typical Redondo home seller.

In terms of sales relative to inventory, inventory rose and sales declined when compared to a year ago. I-S/S is still very high. June 2007 saw 582 properties for sale and June 2008 saw 720. June 2007 saw 181 sales and June 2008 saw 116 sales. It's not reflected in the Moving Average yet, but there is a possibility that I-S/S has bottomed for the summer, and could climb from here. We shall see.

Beach cities median sale price appears to be zigzagging its way down, with a zig (up) for June.

Take a look at Shorewood's press release, and you'll see that sales in all price categories are down when compared to June 2007. Then take a look at homes for sale by price range, and you'll see that the inventory of lower-end homes has more than doubled and tripled. The higher-end range has not piled on anything close to that in inventory, according to Shorewood's numbers. Indeed, Shorewood reports that it was the higher-end homes that appeared to drive the June market, which does not bode well for the market, as the bubble zing that was so prominent in this market in 2004-2006 just isn't there.

A query of my Redondo database for unsold homes $2,000,000 and over shows 29 records, with some original list dates going back nearly 2 years. As you'll see in my July dollar volume report, I think the high end is already starting to fall off a bit, but we'll get to that in due time.

Tuesday, July 29, 2008

Standard & Poors: Los Angeles area median housing price down -24.5% for May 2008

The Case-Shiller Index was released for May 2008.

According to the index, the Los Angeles area median home price was down -24.5% from May 2007, and down -1.9% from April 2008.

The entire Composite-20 metropolitan index was down -15.8% YOY for May. To view the full report, visit Standard and Poors (PDF file). S&P's home price website is here.

The housing bulls will pin much hope on the fact that seven areas in the national index (Atlanta, Boston, Charlotte, Dallas, Denver, Minneapolis, Portland) were flat to slightly up from April. However, all areas are down YOY.

L.A. Land says that readers are arguing convincingly that the month to month decline is decelerating. Of course some permabulls believe this means that recovery is right around the corner in 2009. I've been listening to and reading Mr. Mortgage and personally I think we are just entering the eye of the hurricane and much more agony lies ahead, due to Neg-Am and Alt-A problems that have yet to fully impact our financial system.

By the way, U.S. Representative Jane Harman voted for the Foreclosure Prevention Act (the bailout bill) which gives the IRS powers to snoop into our credit card records. I most definitely will not be voting for her this fall.

Wednesday, July 23, 2008

CAR/DQNews Report June 2008 Report for Redondo Beach

DQNews has released its housing market data for June 2008 for California cities. The CAR link is here.

The median June sale price for a Redondo Beach home (new or existing, SFR or condo) was $672,500, down -15.4% YOY. DataQuick's statistic is based on 64 sales, which is a good number of records with which to calculate such a statistic. This calculation is better than the zip code / property type breakdown calculation which DataQuick also reports and which I complain about regularly. The former is an aggregation of new and existing home sales, SFRs and condos, in 90277 and 90278. The latter is relatively meaningless.

My preliminary calculation for June was high at $704,000, based on 50 records. However I did at least sense that sales had picked up enough that some of the many markdowns I've been observing in the market would be realized, and the price trend was headed further down.

Here is how the beach cities look.

Area               Sales      Median Price       Year Ago      Pct Change
El Segundo           10         $710,000         $909,750         -21.96%
Hermosa Beach        15       $1,035,000       $1,205,000         -14.11%  
Manhattan Beach      36       $1,942,500       $1,300,000         +49.42%
Redondo Beach        71         $672,500         $794,500         -15.36%    
(they don't add up)
Beach Cities         98         $956,500         $960,000          -0.36%

Beach Cities is an aggregation of South Redondo Beach, Manhattan Beach, Hermosa Beach, El Segundo, and Playa del Rey. Redondo Beach, shown in the chart above, is both the north and south parts of the city.

Here are some other selected areas of interest to us.

Area               Sales      Median Price       Year Ago      Pct Change
Beverly Hills       25        $1,580,000      $1,697,500           -6.92%
Malibu               5        $2,700,000      $1,800,000          +50.00%
Palos Verdes Es     19        $1,351,500      $1,542,000          -12.35%
Palos Verdes Pn     48        $1,070,000      $1,261,000          -15.15%
South Bay          379          $617,500        $687,500          -10.18%
Westchester         28          $777,000        $762,500           +1.90% 
West Los Angeles   132          $751,250        $755,000           -0.50% 
Westside            65          $994,500        $720,000          +38.13%

Friday, July 18, 2008

Los Angeles Beach Cities Resale Activity for June 2008

Long time readers know that these DataQuick statistics, broken out by zip code and housing unit type are my least favorite statistics because statistical validity is not supported by such small sales numbers. The only charts with any validity here are the ones for Los Angeles County. Note the smooth lines on the county charts, as opposed to the jerky lines on the beach city zip code charts. That's because there are thousands of data points for the county, as opposed to a handful for each zip code.

There is nothing sacred about median price. It doesn't really help you determine what your own home is worth (the best thing helping you there is probably comparable sales), and these charts say nothing about how far inventory is getting marked down, or how much inventory there is for that matter.

Here are the detailed RESALE statistics for the beach cities and some of the surrounding zip codes (prices are in 1000's):

                         SFR   MEDIAN    %YOY    CONDO  MEDIAN   %YOY  
LA/Westchester    90045   25    $774      1.5%    N/A     N/A     N/A
El Segundo        90245    8    $907    -13.6%     3     $585     4.8%
Hawthorne         90250   23    $430    -17.3%     2     $363   -13.0%  
Hermosa Beach     90254    9  $1,350      4.1%     5   $1,289    12.2%  
Lawndale          90260    7    $358    -33.1%     3     $400    18.7%  
Manhattan Beach   90266   27  $1,900     46.2%     6   $1,010   -57.0%  
Palos Verdes Pen. 90274   20  $1,475     -4.8%     2     $598   106.0%  
Rancho P.V.       90275   27  $1,024     -5.4%     4     $488   -23.3%   
Redondo Beach     90277   13    $870     -9.4%    14     $609   -23.9%   
Redondo Beach     90278   25    $685     -7.7%    15     $650    -7.2%

Wednesday, July 16, 2008

Daily Breeze (print edition): Region's jobs outlook is bleak for housing, finance and manufacturing

This morning I walked two big dogs by the north Redondo Beach post office and as I stopped to mail some letters (bailout protest letters to Senators Feinstein and Boxer, by the way) I found these headlines screaming at me from a newspaper machine:



Projected rise in inflation in 2008, the highest since 1990.


Projected rise in gross domestic product, the lowest since 2002.



Projected job growth for 2008, the lowest since 2003.


Projected unemployment for 2008, the highest since 2004.


Let's see what bubblelicious things the paper has to say.

According to this July 16 headline story by Muhammed El-Hassan, Jack Kyser, a local economist at the Los Angeles Economic Development Corporation, says of our local economy that "it is severely stressed." But he claims that Los Angeles County is doing better than our sister counties of Orange, Riverside, San Bernadino, and Ventura which "are all in recession."

Los Angeles County is expected to gain 8,500 new jobs in health services. The government is expected to add 6,000 jobs (perhaps to beat down those unruly customers standing in line at failed banks); science and technical jobs will add 5,000. But the housing market will cut loose of 10,000 jobs; finance and insurance will lose 5,000 jobs; manufacturing will lose 5,000 jobs. Aerospace will lose only a very small number of jobs - due to problems in the airlines industry related to high fuel prices. The increasing government focus on satellite technology will otherwise boost local aerospace.

I am a little skeptical of the job creation numbers for the simple reason that, even though housing prices are back down to roughly 2004, they remain sky high. And I'm certainly glad that satellite technology will contribute more to the area. With the clothing boutiques; aromatherapy shops; fortune tellers; yoga studios, and what-not in the area I really was starting to wonder just what this local economy does.

International trade has taken hits. Container traffic is expected to drop by 4.5% at the Los Angeles and Long Beach ports. Employment in the motion picture and television industry is expected to drop 3.8%, largely due to the writers strike. Hmm, that's quite a switch from what was happening just a few years ago. A rebound in this field is expected.

Anyway, Jack Kyser says things will be pretty bad until 2010. (And I think he's a bit of an optimist.)

A related Associated Press article by Alex Viega, also on the front page of the Daily Breeze (and online, although probably temporarily) details the plight of a Torrance resident named Doug Gylfe who, despite a 23% drop in Torrance home prices, still can't afford a home. In 90505, where Gylfe lives, the median price of a home in 2006 was $830,000. It is now $636,000 and it is still unaffordable.

The article argues that any attempt to rescue the market merely props up prices and continues to make unaffordability an issue. Edward Leamer at UCLA chips in and says, "The folks who sat on the sidelines, they should feel legitimately annoyed that the more speculative folks who bought homes they couldn't afford are going to be bailed out by the federal government. And these other folks who acted responsibly and didn't get in over their head and decided they didn't want to buy the home, they are not getting any benefit."

The article discusses some of the initiatives that Congress is considering. And it reminds us that the traditional benchmark is that housing costs should not exceed 28% of a household's gross monthly income.

I find it interesting that an old guideline is now being trotted out. It's part of a contraction trend back to more conservative valuations and measurements.

Remember how I was saying in an earlier post that a particular housing industry watcher left herself some wiggle room when she stated:

"If the bottom falls out of the economy and we have significant job losses, then everything will come down: home prices, rents, everything. That could take quite a while to work through."

That particular industry observer may be happy in the not-to-distant future that she left herself an out.

Remember it wasn't so long ago that some of these observers were trying to tell us that Los Angeles and California won't slump because of the strong employment base. We shall see.

Stay tuned.

DQNews: Southland home sales drag along bottom

DQNews has published Southland home sale numbers for June. June's sales were the highest in 10 months, but the lowest June on record, since DataQuick started keeping track in 1988. 17,424 new and existing SFRs and condos were transacted in June, compared to a historical June average of 28,488, and a maximum of 40,156 sales in June 2005.

The Inland Empire is the only area where sales have increased YOY, and it's easy to see why. That area was the first to melt down and so has experienced a greater overall decline than the other areas, so buyers think they are getting bargains.

The Southland median June home price was down -4.1% from May.

Prior to the credit crunch hitting last August, some 40% of southland sales were financed with jumbo loans. Today the figure is 16.3%, which edged up very slightly from May. And remember that the conforming loan limit has been raised and is no longer $417,000.

In May foreclosures were 39.2% of all sales; in June it was 41.1%. Southland buyers committed themselves to a typical monthly payment of $1,671, down from $1,713 in Ma7, and down from $2,430 YOY. Foreclosures remain pegged at record levels, ARM financing is at a 6 year low, and non-owner occupied buying activity is low, according to DataQuick. Recall that the L.A. Business Journal said that it had been seeing an increase in such activity, so perhaps it is wearing off.

Peter Hong at the L.A. Times reports in this July 17 story (Southern California home sales and prices keep falling) that prices are down to 2004 levels, which pretty much correlates with what I've been seeing in short sales in Redondo Beach.

Somebody thought to ask Chris Thornberg of Beacon Economics his opinion. He says that affordability is not there yet and prices need to drop 40% below the peak before incomes match prices.

Peter Green at USC's Lusk School of Real Estate has decided prices have fallen far enough and he's out shopping for falling Ginzu knives. He figures if prices fall another 10% that's OK with him. I'd love to know how he's so sure it'll stop there. Will he end up like Professor Irving Fisher in 1929, who said that stocks reached a permanently high plateau and then ended up having Yale university buy his house to prevent his homelessness since he lost so much money in the stock market crash?

Perhaps of interest to beach-area residents, prices in these and other affluent areas are showing "sharp declines" and I am in fact seeing substantial markdowns here. But I can tell you they've hit the 40% level and I think there is room for much more in the way of markdowns, beyond what Peter Green or Chris Thornberg are saying.

DataQuick blames the situation on the tight credit conditions, noting that even "well-qualified household" aren't getting mortgage loans.

County           Sales    Sales      %YOY      Median      Median      %YOY
                 June 07  June 08     Chg      June 07     June 08      Chg
Los Angeles      7,580    5,678     -25.1%     $545,000    $415,000   -23.90%
Orange           2,641    1,930     -26.9%     $645,000    $495,000   -23.30%
Riverside        3,359    3,757      11.8%     $400,000    $275,000   -31.30%
San Bernardino   2,190    2,215       1.1%     $365,000    $240,000   -34.20%
San Diego        3,510    3,077     -12.3%     $495,500    $370,000   -25.30%
Ventura            886      767     -13.4%     $582,000    $420,000   -27.80%
SoCal           20,166   17,424     -13.6%     $502,000    $355,000   -29.30%

Thursday, July 10, 2008

Preliminary look at June 2008 Redondo Beach housing market data

My working set of data is pulled mostly out of Manhattan Beach Reporter, with a few out of Zillow. I have 50 records for June, which comes up a bit short, so let's hope I have a good representative set of data.

Sales volume is continuing to climb, which is good as the volume will mark to market all these price cuts I've been recording for so many months. When I calculated median and average Redondo Beach sale price for June 2007 I also had 50 records and I came up with $782,500 and $833,090, respectively. My June 2008 median sale price is down -10% YOY. I think there is a good chance we will continue to see prices slide when the official numbers come out later this month from DataQuick.

Sale Price

STAT      DEC 2007   JAN 2008   FEB 2008   MAR 2008   APR 2008   MAY 2008    JUN 2008
records         26         25         25         35         40         61          50
MEDIAN    $782,500   $795,000   $755,000   $789,000   $756,000   $742,000    $704,000
AVERAGE   $832,827   $932,117   $831,500   $961,714   $833,000   $775,589    $754,000
MIN       $486,500   $449,900   $520,000   $585,000   $420,000   $269,900    $420,000
MAX     $1,500,000 $2,130,000 $1,590,000 $2,100,000 $2,425,000 $1,430,000  $1,351,000

Sales by Square Footage

For June 2007 I calculated the median square footage of a sold property at 1762 and the average at 1838. For June 2008 my calculations came in at 1752 and 1787, respectively. Median square footage is very nearly the same, while average square footage has been pulling back, which might be an indication of big high-end luxury properties hitting a slump, so more smaller low-end homes are being sold relative to high-end homes than a year ago.

DOM (Time on Market)

My June 2007 calculation of time on market was a median 90 days and an average 117 days. For June 2008 I come up with 127 and 182, respectively. This is up just very slightly from my prior month calculations. The "tale of two markets" continues, with literally two axes in the graph - one for the home sellers who sold relatively quickly, and one axis for those whose properties have been sitting on the market for literally years now.

Percent Reductions

And how much did sellers have to lower their asking prices in order to make their sales? For June 2007, I calculated a median reduction of 3.40% and an average reduction of 3.89%. For June 2008, I have calculated a median reduction of 7.47% and an average reduction of 8.65% for sold properties.

I am really seeing some quick and substantial markdowns on new properties in south Redondo. In spite of the fire sale that's been going on down there, there is still a glut of properties, obviously. Some of these markdowns are in the neighborhood of nearly 40%. And you know what? The prices are STILL high.

Some listings are coming on aggressively priced so as to outrun any price decline. Therefore I wouldn't be surprised if we see a few more properties sell OVER their original asking prices.

Current Asking Prices, by Month

I am not sure I should keep publishing this chart, because I found some flaws in how I calculate it. The problem is the way I store the price reductions. Unfortunately, old price changes that are stored in number fields get overwritten as I update these number fields with new price changes. The old price changes get preserved in a text field, but I would have to literally process through my database and parse out these text fields in order to record each and every price change for this trend graph. For now, let's hope that I at least have the general trend right.

June Short Sales

Out of 50 records that I recorded, 20% of them were short sales. I don't know if they were all plain vanilla short sales or there was something wacky going on that wouldn't ordinarily be recorded as a normal, arm's length transaction. But here they are. The properties at 1709 Perkins, on Mansel, and on North Lucia look especially suspicious. If anybody knows anything in particular about these properties, feel free to post a comment!

If I throw out those three records as wacky outliers and take an average of the six remaining records, the average short sale I recorded is 7.5%. Keep in mind this is on a very small data set. I would be curious to know if anyone is aware of short sales in Manhattan Beach, Hermosa Beach, and El Segundo, or is it just Redondo that is buckling under here.

I have not yet discovered a short sale from a prior sale in 2003.

SALE      PRIOR SALE       %      ADDRESS
DATE          DATE       RED

2008-06-03 2004-11-15   -9.0   2207 Perkins Lane B
2008-06-12 2007-03-07  -47.0   1709 Perkins Lane 2 
2008-06-16 2005-05-12   -8.0   1509 Stanford Avenue
2008-06-16 2006-04-15  -44.0   807 N. Lucia Avenue 2
2008-06-16 2006-07-15  -11.0   2120 Dufour Street 2
2008-06-16 2007-01-03   -2.0   2512 Vanderbilt Lane C 
2008-06-19 2006-09-15  -42.0   18403 Mansel Avenue 2
2008-06-23 2006-08-15  -14.0   112 Via El Chico
2008-06-23 2007-03-14    0.0   1709 Goodman Avenue
2008-06-30 2005-11-15  -15.0   1219 Ynez Avenue

Monday, July 07, 2008

L.A. Business Journal: Condo Market Bouncing Back?

That's the headline in a Howard Fine story on the front page of the July 7 print edition of the Los Angele Business Journal. The skeptical bear in me says NO, but let's see what the article says.

The article says that June sales were good, "exceeding the seasonal surge, especially in condos." This was more than double what was sold in May, and the largest number since July 2007.

This was still down 4% YOY. And, according to Home Data, the 3,332 new and existing homes sold in June was a 30% increase over May, but down -28% YOY.

So why the big jump? PRICE. According to Dolores Conway of USC's Lusk Center for Real Estate, "prices are down far enough now that people who have been sitting on the sidelines are now jumping back in." The median SFR price is now down to the lowest it has been since October 2004, falling to $429,000. As one agent says, "The bargain hunters have come out in force."

In addition to price, there are increasingly large amounts of foreclosure properties available on the market. New condominium projects are STILL being built and coming on to the market, some at steeply discounted prices. The flipping dream remains, with buyers increasingly looking to buy and rent out their condos. Finally, gas prices are compelling buyers to seek properties (these days, mainly condos) closer to urban centers. The lower dollar has attracted foreign buyers. These are all factors in the bounce.

According to Bill Toth of Windermere/Bill Toth Associates in Burbank, "the market improvement always starts at the bottom, when properties become more affordable and people who has sat on the fence jump in. That's what we're starting to see now."

But it's not just the bottom-of-the barrel scrapings that are getting sold. Near waterfront condos in Long Beach are "selling briskly" and starting around $500,000.

Foreign buyers have been buying condos in Marina del Rey.

Properties near major sources of transportation are doing relatively well. Thanks to the Gold Line, the Pasadena market has enjoyed a bounce.

Rents are still edging up, and investment buyers have been coming out and buying condos because they can rent them out more quickly now. Conway at USC says there isn't a whole lot more room for prices to fall to return to the historical norm of being in line with monthly rents. "The cost of home ownership is starting to approach the cost of average rent."

-------------------------- SFR ----------------------------------
COMMUNITY          ZIP    June     %YOY        June    %YOY
                          Sales   Change      Price   Change
L.A County              3,332       -28%    $429,000  -25% 
El Segundo       90245      7       -30%    $675,000  -29%
Hermosa Beach    90254      8       -73%  $1,000,000  -16%  
Manhattan Beach  90266     23       -41%  $1,610,000   +4%  
Redondo Beach    90277     10       -23%    $918,000   +7%
Redondo Beach    90278     18       -33%    $806,000   +8%

------------------------ CONDO ----------------------------------
COMMUNITY          ZIP    June     %YOY       June       %YOY
                          Sales   Change    Price     Change
L.A. County              1,254      -4%    $386,000   -12%
El Segundo       90245       3     200%    $639,000    -9%
Hermosa Beach    90254       7     250%  $1,035,000   +36%
Manhattan Beach  90266       5     400%    $999,000   +15% 
Redondo Beach    90277      20     +25%    $640,000   -25%
Redondo Beach    90278      23     -28%    $580,000   -21%

The most expensive homes (SFRs) in June were in Westwood 90024 (+171% YOY); Santa Monica 90402 (+23%); Malibu 90265 (+35%); Beverly Hills 90210 (+3%) and 90211 (+19%); San Marino 91108 (+32%); Hancock Park 90004 (+131%); Manhattan Beach 90266 (+4%); Bel-Air 90077 (+66%); and Marina del Rey 90292 (+11%).

The most expensive condos in June wre in Venice 90291 (+42% YOY); Palos Verdes Estates 90274 (+317%); South Park 90015 (YOY comparison not available, median price $1,100,000 on three sales); Hermosa Beach 90254 (+36%); Manhattan Beach 90266 (+15%); Beverly Hills 90211 (-20%); Santa Monica 90405 (-3%); Marina del Rey 90292 (-4%); West Hollywood 90038 (YOY comparison not available, median price $725,000 on three sales); and Rancho Palos Verdes (-17%).

The communities with greatest SFR price losses in June were Littlerock 93543 (-59% YOY); Brooklyn Heights 90033 (-58%); Koreatown 90066 (-57%); Burbank 91501 (-52%); Hollywood Hills 90068 (-51%); Signal Hill 90755 (-50%); City College area 90029 (-50%); Woodland Hills 91364 (-48%); La Habra 90631 (-47%); and Lancaster 93535 (-45%).

The communities with the greatest condo price losses in June were Westlake 90057 (-52% YOY); Canoga Park 91304 (-50%); Covina 91722 (-50%); Palms 90034 (-45%); Gardena 90247 (-44%); Long Beach 90814 (-43%); Tujunga 91042 (-42%); Phillips Ranch 91766 (-41%); Windsor Square 90020 (-41%); and Canyon Country 91351 (-39%).

Wow, it almost sounds like 2005 or 2006 again, doesn't it? YOU WANNABE REAL ESTATE MOGULS NEED TO BUY YOUR INVESTMENT CONDOS AND RENT 'EM! Little mention of tighter credit conditions except that conforming loan limits were raised. No mention of the tidal wave of foreclosures that has YET to hit California (catch up on Mr. Mortgage's reports if you have not done so.) One month of good sales and Happy Days Are Here Again. Chris Thornberg? Who's he? It's not until the very last paragraph of this article that Conway mentions any possible alternative scenarios with a negative outcome - "If the bottom falls out of the economy and we have significant job losses, then everything will come down: home prices, rents, everything. That could take quite a while to work through."

It sounds to me like this decline has ushered in a whole new wave of suckers who have conveniently forgotten that many of the foreclosures sitting on the market now were once bought by starry-eyed wannabe homeowners who bought at the same prices back in 2004 and after. And there are still some "stupid" mortgages available (I've discussed in previous postings the FHA loan specifications I've seen floating around my neighborhood.)

By the way, if you subscribe to Elliott Wave publications, then you'll know that in a recent Financial Forecast, it was reiterated that foreign buyers are often the ones left "holding the bag" in asset markets (with real estate being the focus of the moment). The locals usually have more of an advantage. The recent EWI Finanicial Forecast warned that "As the thirst for cash becomes all-consuming, the bath water, the baby, the tub, the bathroom, and the whole house will be made available for sale; that is, if the house is worth anything. That is why it is important to resist the too-early urge to snap up assets with even the most impeccable credentials." And why the thirst for cash? The catalyst according to this recent issue is that hedge funds have been facing withdrawals, although tightening credit conditions has been a general factor.

Friday, July 04, 2008

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

The late spring-summer bounce is still underway, and I'm sure you'll hear local realtors trumpeting a bounce in sales as if to mean the market has recovered. But any local industry discussion of the markdowns needed to achieve those sales are pretty much limited to two words: psychological adjustment. Realtors have yet to acknowledge that the slowdown has hit the south bay. They will only say that well-priced properties sell quickly, which to some extent is true. What they don't say is that you have to have been fortunate enough to have bought your property before 2003 and not have taken out any debt against it that you are able to price your property very competitively and still close the sale coming out ahead. As far as I can tell from the ads in the Manhattan Beach Reporter, they don't discuss their expertise in working out short sales with your lender.

But sales remain pretty much well below last year's levels. South Redondo (90277) barely managed to eke out a sales volume above that of June 2007, but since the average sale price has dropped significantly, dollar volume remains down. El Segundo (90245) almost hit last year's June sales volume. Sales volume remains way down in north Redondo (90278), Manhattan Beach (90266), and Hermosa Beach (90254).

Zip      Sales    Sales    Dollar Volume    Dollar Volume
          2008     2007    2008($1000's)    2007($1000's)

90245      10       11        $6,970           $11,418           
90254      15       32       $21,795           $41,120           
90266      28       40       $46,900           $68,440
90277      30       29       $21,120           $26,506
90278      41       59       $27,839           $46,197 

YOY Comparisons

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

Even Playa Vista is starting to show a little weakness. I think this is the first time that everything I show in this list is down

90232           -10.3% Culver City
90302           -15.5% Inglewood
90254           -21.1% Hermosa Beach
90045           -24.4% Westchester
90292           -26.5% Marina del Rey
90245           -27.9% El Segundo
90094           -30.3% Playa Vista
90035           -32.2% West Fairfax
90034           -36.4% Palms
90275           -38.3% Palos Verdes Estates
90008           -38.9% Baldwin Hills / Leimart Park
90064           -40.4% Rancho Park/Cheviot Hills
90501           -42.4% Torrance
90502           -43.2% Torrance
90505           -45.9% Torrance
90504           -46.2% Torrance
90066           -46.8% Mar Vista
90401-90405     -46.8% Santa Monica combined
90305           -47.5% Inglewood
90717           -49.7% Lomita
90501-90505     -49.9% Torrance Combined
SW county       -50.6% Southwest L.A. County
beach cities    -50.7% 4 Beach Cities combined
90291           -50.8% Venice
90745           -53.2% Carson
90277           -53.4% Redondo Beach (south)
90260           -53.6% Lawndale
90746           -53.9% Carson
90277-90278     -54.9% Redondo Beach combined
90250           -55.3% Hawthorne
90249           -55.3% Gardena
90278           -56.0% Redondo Beach (north)
90019           -56.1% Country Club Park/Mid City
90230           -56.5% Culver City
90016           -56.6% West Adams
90301-90305     -58.2% Inglewood/Lennox combined
90266           -60.4% Manhattan Beach
90007           -60.4% South Central
90503           -62.3% Torrance
90036           -62.5% Park La Brea
90293           -62.8% Playa del Rey
90732           -64.0% San Pedro/Rancho PV
90047           -65.0% South Central
90301           -66.0% Inglewood
90056           -67.0% Ladera Heights
90247           -68.0% Gardena
90731           -68.1% San Pedro
90043           -68.5% Hyde Park, Windsor Hills
90044           -71.0% Athens
90062           -71.3% South Central
90037           -72.1% South Central
90303           -76.1% Inglewood
90018           -78.7% Jefferson Park
90304           -83.1% Lennox
90744          -175.0% Wilmington

Relative Strength

This is a longer-term view of the strength of dollar volume in a given zip code. For this month 5.4 is the strongest (suffering the least amount of chronic pain) and -1.5 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.

We are getting more areas now falling at 0 and below.

90094           5.4 Playa Vista
90247           2.9 Gardena
90305           2.5 Inglewood
90034           1.6 Palms
90044           1.5 Athens
90292           1.3 Marina del Rey
90746           1.3 Carson
90047           0.8 South Central
90502           0.7 Torrance
90301-90305     0.7 Inglewood/Lennox combined
90062           0.7 South Central
90007           0.7 South Central
90304           0.6 Lennox
90501           0.6 Torrance
90302           0.6 Inglewood
90018           0.6 Jefferson Park
90016           0.6 West Adams
90293           0.6 Playa del Rey
90745           0.6 Carson
90301           0.5 Inglewood
90250           0.5 Hawthorne
90064           0.5 Rancho Park/Cheviot Hills
90732           0.5 San Pedro/Rancho PV
90254           0.5 Hermosa Beach
90303           0.4 Inglewood
90008           0.4 Baldwin Hills / Leimart Park
90045           0.4 Westchester
90019           0.4 Country Club Park/Mid City
90043           0.4 Hyde Park, Windsor Hills
90291           0.3 Venice
90037           0.3 South Central
90245           0.3 El Segundo
90230           0.3 Culver City
90249           0.2 Gardena
90503           0.2 Torrance
SW county       0.2 Southwest L.A. County
90036           0.2 Park La Brea
90501-90505     0.2 Torrance Combined
90232           0.2 Culver City
90260           0.2 Lawndale
90066           0.1 Mar Vista
90278           0.1 Redondo Beach (north)
90505           0.1 Torrance
90401-90405     0.1 Santa Monica combined
90731           0.1 San Pedro
90277-90278     0.0 Redondo Beach combined
beach cities    0.0 4 Beach Cities combined
90035           0.0 West Fairfax
90056           0.0 Ladera Heights
90717           0.0 Lomita
90266           0.0 Manhattan Beach
90277           0.0 Redondo Beach (south)
90504          -0.1 Torrance
90275          -0.2 Palos Verdes Estates
90744          -1.5 Wilmington

Expect the bear market bounce to continue at least through July, which has started off strong.

To look at charts for specific zip codes, click here or here.

Tuesday, July 01, 2008

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

Shorewood has published its May statistics.

According to the realty firm, the average DOM for sales in the four beach cities was 55, which is the highest May DOM since I've started keeping track of Shorewood's DOM numbers, which go back to July 2004.

In my calculations of median and average DOM for Redondo Beach sales, my notion of time on market is different from Shorewood's. The realty firm uses a strict interpretation, starting a counter from the last time a property is relisted before it is sold. My calculation of DOM looks at the time the property first enters the market and tallies all the time the property waits before it is finally sold. So it probably is no surprise that my calculation for Redondo Beach of average time on market is 173 days (nearly 6 months), which is skewed by homes sitting on the market for close to two years, and homes which enter the market priced very competitively and sell relatively quickly.

In terms of sales relative to inventory, sales edged up in May and inventory edged down. I-S/S is still very high. May 2007 saw 513 properties for sale and May 2008 saw 699. May 2007 saw 173 sales and May 2008 saw 135 sales.

Beach city median price appears to be showing some cracks, no doubt due to weakness in the high end and luxury market. Check Shorewood's press release by price category and you'll see that all price category sales are down below last year except for categories of homes sold under $750,000.

Shorewood doesn't like talking about price declines much, referring to the decline as a "psychological adjustment." The firm goes on to say that one month of decline is not necessarily the start of a trend, noting that foreclosures haven't impacted the beach cities the way they have other markets. The press release does not even mention weakness in the high-end market.

The firm does not discuss short sales at all. And as for foreclosures impacting the beach cities, my thoughts on that are "give it time."