Sunday, May 15, 2011

Los Angeles Business Journal: Uptick in volume may not presage rising prices

Why have I not blogged about the South Bay real estate market in two years? Because it would have been a complete and utter waste of time.

What has positively changed since the earthquakes started hitting the asset markets in 2007 and 2008? Other than a few heroin injections provided by Washington to stimulate the economy, all charged on a gigantic credit card to be repaid by the debt and tax slave labor of you and your children and their children, absolutely nothing. We have been in the eye of the storm. While we have been enjoying the relative calm in the storm's eye, Washington politicians and the financiers who bankroll their campaigns are as corrupt as ever and there are still trainloads of suckers out there who actually believe we are in a recovery.

I still have several of my tea party signs from 2009 in my closet here at home. Since nothing has changed they are still 100% relevant. I would welcome an opportunity to hold these signs up again and even create new ones. In the meantime, the tea party organization has become a joke, seduced by the likes of Sarah Palin, a shill for John McCain, GOP presidential candidate in the 2008 election who actually suspended his campaign at one point to rush back to Washington and vote for a heroin injection. Another tea party seducer has been Newt Gingrich, he of the high and mighty moral ground who left an ex-wife while she was dying of cancer. There may even have been child support issues, though I have not seen confirmation of that. Yep, just the kind of character we need running this country.

I quit the local tea party here long ago, in total disgust. I just don't believe in false idol worship of Ronald Reagan - he of the war on drugs, and of restrictions on how much money you can transfer or carry - because you might be one of those damn drug dealers! He talked a few good lines but he was an actor and he was supposed to say those lines. Nor do I believe in labeling Jimmy Carter a freak simply because he had the audacity to turn down the thermostat in the White House and wear a sweater to save on energy costs. Last week, for the 36th district congressional primary, I turned in my first blank ballot - ever. I regret not having written in, "None of the above."

We so desperately need people with integrity in office with the backbones to go after these bankers that have committed financial fraud, who have wrongly foreclosed on peoples' homes with "mistakes in paperwork", at the same time going after those who have lied on loan applications. Liars who have broken laws need to feel justice, no matter what rung of the ladder they have landed on. We are all supposed to be equal under the law.

Nobody in Washington - not even Ron Paul - is truly sounding this alarm nor taking any concrete steps to go after fraud perpetrators. He is the House Chairman of Domestic Monetary Policies and I have not heard a single word about the actions of Bank of America, Wells Fargo, or other lenders or of any plans to bring these institutions before justice. Dr. Paul may want to blame all our problems on the Federal Reserve, on shifting away from our Constitutional groundings, or on the credit bubble, but individuals, corporations and governments are still responsible for their own fraudulent actions, bubble or no bubble. While reducing the size of government sounds like the right thing to do, how does this idea translate into the more pressing and immediate matter of dealing with maybe millions of angry Americans who may resort to violent action because food costs have soared and they are about to lose their homes? They don't understand credit bubbles and Austrian economics. This country has no sheriff.

Enough of that. Here are the latest figures out of the L.A. Business Journal. Over the last two years, the journal has not been diligent about putting a leader on its front page when there is a residential real estate story. Nobody likes being the announcer of bad news so I think that has been a deliberate choice. The upshot of that is that I don't have LABJ data from the last two years, only whatever pieces I have picked up here and there:

-------------------------- SFR --------------------------------
COMMUNITY          ZIP    Apr     %YOY         Apr    %YOY
                         Sales   Change      Price   Change
L.A County              3,745      -10%    $340,000    -3%
El Segundo       90245      4        0%    $845,000    +9%
Hermosa Beach    90254      7      -13%  $1,355,000   +52%
Manhattan Beach  90266     19      -24%    $963,000   -23%
Redondo Beach    90277     11      +57%    $899,000   -10%
Redondo Beach    90278     14        0%    $652,000    -8%

------------------------ CONDO --------------------------------
COMMUNITY          ZIP    Apr     %YOY      Apr       %YOY
                         Sales   Change    Price     Change
L.A. County              1,433      -6%    $275,000   -11%
El Segundo       90245       3     -25%    $539,000   +32%
Hermosa Beach    90254       4     -50%    $865,000    -3%
Manhattan Beach  90266       9    +200%  $1,215,000   +16%
Redondo Beach    90277      15     +36%    $610,000    +1%
Redondo Beach    90278      25     -17%    $570,000   -15%

I got the impression from the LABJ article that the industry may be one step closer to facing reality. The headlines says "Uptick in Volume May Not Presage Rising Prices." Maybe somebody is finally catching on.

Let's face it. Some people don't recognize reality until the walls come crashing in on them and the water rushes in.

Right now I think is a dangerous time to even consider buying real estate, even though there are a few decent prices elsewhere in the country. Why dangerous? Because desperate governments short of funds do desperate things. That includes local governments. They will do what they damn well please regardless of the laws in the books designed to protect you because they know nobody's going to enforce those laws.

In front of me is an article called "A Homesteaders Journal", from the May/June 2011 edition of Backwoods Home Magazine, written by somebody with 20 undeveloped acres she had not improved out in the middle of nowhere. This is what really caught my eye - last year, her property taxes were $14. In one year, they were increased to $460. That's a 3185% property tax increase in one year. When you are retired and don't have steady income (how are you making out on the interest on your Treasury bills lately?) that sucks.

Another article in front of me is from the January 13, 2011 edition of the Manhattan Beach Reporter. Apparently the Hermosa Beach City Council tried to raise residential parking fees and the residents screamed bloody murder. One resident wrote,

"[Under] what rock have our City Council members been living? Is it possible these individuals are not aware that property values have plummeted and unemployment rates and home foreclosures are at an all time high?"

So in the land of sunshine and strand bicycling and beach parties, not all is well. Some people feel like they are hanging on by a thread. All it will take is another financial tsunami to tip them over.

I have an e-mailbox stuffed with over two years of real estate listings I have yet to enter in my database, plus over two years worth of sales clippings out of the Manhattan Beach Reporter that all need to be entered in my database - when I have the time. Today, I was amazed that I was actually able to import my old local real estate database into a newer version of MySQL on my new computer without a bit of struggle. So I am up and running. I am working at my real job close to 12 hours a day leaving me little time for other pursuits, so I will only state that I will do what I can do for this blog when I can.

Tuesday, April 21, 2009

Los Angeles County South Bay Beach Cities Real Estate $$$ Transacted through March 2009

My intent is to publish the dollar volume charts on a quarterly basis. These charts show data through the end of March 2009.

Generally, sales volume has rebounded somewhat. Last year during Q1 sales volume was in the dumpster, so some rebound has been bound to occur.

Dollar volume is climbing up in several areas. When you look at the statistics tables below, you'll notice that the YOY dollar volume has zoomed up past zero in areas such as parts of Torrance; Gardena; Wilmington; Lawndale; Inglewood; Lennox; and Carson. I am stating the obvious when I say that these are not affluent areas of Los Angeles County. I suspect that some falling Ginzu knife shoppers with dreams of becoming landlords (maybe slumlords) are out there shopping. Redondo Beach has climbed back YOY, very close to zero, but this is the "poorest" of the beach cities. In general, YOY dollar volume has not (yet) climbed back for the beach cities, nor for SW Los Angeles County.

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. Notice that I accidentally tallied these backwards. Normally I list these in descending order.

90094         -81.4%       Playa Vista   
90292         -64.6%       Marina del Rey   
90036         -59.8%       Park La Brea   
90501         -59.8%       Torrance   
90007         -56.2%       South Central   
90293         -53.6%       Playa del Rey   
90291         -53.0%       Venice   
90254         -52.4%       Hermosa Beach   
90056         -51.0%       Ladera Heights   
90302         -48.6%       Inglewood   
90062         -48.6%       South Central   
90245         -48.4%       El Segundo   
90019         -44.6%       Country Club Park/Mid City   
90064         -42.4%       Rancho Park/Cheviot Hills   
90301         -42.3%       Inglewood   
90045         -41.3%       Westchester   
90016         -40.8%       West Adams
90066         -39.2%       Mar Vista
90034         -38.1%       Palms
90043         -37.2%       Hyde Park, Windsor Hills
90044         -34.8%       Athens
SW county     -32.7%       Southwest L.A. County
90501-90505   -31.3%       Torrance Combined
90266         -30.9%       Manhattan Beach
90018         -30.8%       Jefferson Park
90037         -29.6%       South Central
90008         -28.9%       Baldwin Hills / Leimart Park
90401-90405   -28.7%       Santa Monica combined
beach cities  -28.5%       4 Beach Cities combined
90505         -25.8%       Torrance
90047         -22.3%       South Central
90275         -20.2%       Palos Verdes Estates
90250         -17.2%       Hawthorne  
90502         -15.9%       Torrance  
90504         -15.5%       Torrance  
90035         -14.1%       West Fairfax  
90717         -12.5%       Lomita  
90278         -10.2%       Redondo Beach (north)  
90277-90278    -8.0%       Redondo Beach combined  
90277          -5.2%       Redondo Beach (south)  
90301-90305    -3.2%       Inglewood/Lennox combined  
90249          -1.7%       Gardena  
90503           2.3%       Torrance  
90732           2.8%       San Pedro/Rancho PV  
90232           3.3%       Culver City  
90230           3.9%       Culver City  
90247           8.6%       Gardena  
90746          15.7%       Carson  
90744          18.7%       Wilmington   
90731          22.4%       San Pedro   
90260          25.0%       Lawndale   
90304          36.7%       Lennox   
90305          59.7%       Inglewood   
90745          69.6%       Carson   
90303         122.2%       Inglewood 

Relative Strength

This is a longer-term view of the strength of dollar volume in a given zip code. For this month 4.9 is the strongest (suffering the least amount of chronic pain) and -0.3 is 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   
90247           2.9  Gardena   
90305           2.3  Inglewood   
90034           1.4  Palms   
90746           1.1  Carson   
90044           1.0  Athens   
90292           0.9  Marina del Rey   
90745           0.6  Carson   
90502           0.5  Torrance   
90304           0.5  Lennox   
90744           0.4  Wilmington   
90301-90305     0.4  Inglewood/Lennox combined   
90047           0.4  South Central   
90303           0.4  Inglewood   
90501           0.3  Torrance   
90007           0.3  South Central   
90249           0.3  Gardena   
90018           0.3  Jefferson Park   
90062           0.3  South Central   
90250           0.3  Hawthorne   
90016           0.2  West Adams   
90732           0.2  San Pedro/Rancho PV   
90302           0.2  Inglewood   
90064           0.2  Rancho Park/Cheviot Hills   
90232           0.2  Culver City   
90301           0.1  Inglewood   
90260           0.1  Lawndale   
90293           0.1  Playa del Rey   
90254           0.1  Hermosa Beach   
90043           0.1  Hyde Park, Windsor Hills   
90230           0.1  Culver City   
90503           0.0  Torrance   
90245           0.0  El Segundo   
90045           0.0  Westchester   
90291           0.0  Venice   
90019           0.0  Country Club Park/Mid City   
90501-90505     0.0  Torrance Combined   
90008           0.0  Baldwin Hills / Leimart Park   
90505          -0.1  Torrance   
90278          -0.1  Redondo Beach (north)   
SW county      -0.1  Southwest L.A. County   
90066          -0.1  Mar Vista   
90035          -0.1  West Fairfax   
90401-90405    -0.1  Santa Monica combined   
90037          -0.2  South Central   
90277-90278    -0.2  Redondo Beach combined   
90036          -0.2  Park La Brea   
90056          -0.2  Ladera Heights   
beach cities   -0.3  4 Beach Cities combined   
90277          -0.3  Redondo Beach (south)   
90275          -0.3  Palos Verdes Estates   
90504          -0.3  Torrance   
90731          -0.3  San Pedro   
90717          -0.3  Lomita   
90266          -0.3  Manhattan Beach   

Thursday, April 16, 2009

Your South Bay housing bubble blogger, courtesy of the South Bay Tea Party

Hi everybody!

Recall that last week I posted announcements about the South Bay Tea Party to be held on April 15. The reason why I volunteered to help organize this event was because we need to hold Washington and Wall Street crooks accountable for their toxic contributions to the economic mess we now face - including housing prices that in my opinion are still way too high. We need balance sheets to come clean in order to restore some health and sanity to our asset markets - including our housing markets. Financial fraud, reckless spending, pork, borrowing, and money printing MUST stop.

Here's a report on what happened immediately before and at the South Bay Tea Party.

Yours truly fulfilled her secret fantasy of becoming a sign twirler and stood at the corner of Aviation and Rosecrans on the evening of Tuesday, April 14, fighting the wind and freezing her ass off, advertising this event. I made signs with an Alice in Wonderland theme (she had a famous tea party, you know!) so I dressed up as the Queen of Hearts. One of my signs said "NO bailouts for weasels! OFF WITH THEIR HEADS!" which unfortunately, was not photographed.

On the day of the event itself, somewhere between 1000 and 1500 people showed up.

The wind was hellacious and did not let up all day, making it just about impossible to put up our banner and hold up signs, but we somehow managed. The sand was blowing into our faces and eyes making things even harder, plus it was quite cold and it got very overcast in the afternoon.

El Segundo Police told us in the morning they got a brief from ACORN saying they might crash our party. The police weren't worried about us - they were worried about ACORN. Ultimately, ACORN and other dissenters did not show up. They probably thought we were too small to mess with.

I ended up out in the parking lot for most of the event helping people register and giving them signs to hold if they wanted. So unfortunately I didn't hear most of the speeches. Tammy Bruce was the guest speaker. There was also a moving speech by a young black man who served in the military, raised in a single-parent household of six kids. I heard some of it, but wasn't able to hear all of it from where I was in the parking lot.

Not a whole lot of press was there, which may have ended up being a good thing. Somebody from USC journalism was there for just about the entire event. Daily Breeze was there, and that reporter in fact interviewed me. I got a kick out of the guy from AP. Turns out he's from Mexico, and he said he left Mexico because of the wacky politics and came here and lamented about how now "this country is being ruined."

Contrary to media reports, this party was not run by any local GOP club. In fact, our organizer told the local GOP chapter when it asked about getting in on the action - thanks but no thanks.

I heard from a friend of a friend who attended a party in NYC that his party "got hijacked by Fox News and the GOP" but that didn't happen here. Our party REMAINED our party. Some of my fellow protesters, staunch Republicans, told me how they've been slamming their phones down on the GOP, vowing not to send another dime to them.

I designed roughly 24 posters for this event. Our living room looks like a cyclone tore through an art supply store. The poster that seemed to really push peoples' buttons the most was my Somali pirates sign. A lot of people, including the two reporters I talked to, took photos of that sign or gave me a thumbs up. The wind was so bad that this strong fellow had to help me hold it up.

Yours truly was also quoted in the Daily Breeze's coverage of this event:

Dockweiler State Beach Tea Party blasts governor's special election, Prop. 1A, by Max Zimbert

1500 people showing up for this event may not seem like much, but let's put that in perspective. I've been a Ron Paul supporter for many years, having donated to his Congressional campaigns on and off since maybe 1998. Before the presidential primaries I registered as a Republican so I could vote for Ron Paul in the primaries. The weekend before the primaries, at the last possible minute, I became a precinct leader and spent that weekend leafletting not only my precinct but helping out another person's precinct. Only then did I realize that there simply were not enough arms, legs, and mouths to spread the idea of limited government reined in by the Constitution. Roughly a year later, our organizer, Nathan Mintz, held his initial meeting with only 2 people. His group of helpers grew to about 12 - including me. Now we had this event, held on a midweek day in freezing windy uncomfortable weather in a location that wasn't exactly obvious or easy to get to. I'd call that progress.

You can view photos we took of the party here. If you like the idea of restoring health to our asset markets - including our housing markets - by stopping reckless borrowing, spending, money printing, and holding politicians accountable for the corruption that runs Washington and Wall Street, join us and sign up at South Bay Tea Party. You can also find us out on Facebook.

I've got the L.A. Business Journal in my backpack and a pile of other stuff to blog about the housing market. I hope to be back in the blogging saddle shortly.