Inventory has continued to decline.
The apartment vacancy rate has continued to decline.
Home building and other housing related stocks as represented by the XHB have continued to make new highs (new 52 week high today).
So it looks like all the positives which manifested themselves in 2012 are alive and kicking as we enter 2013. Additionally, we got through the supposedly scary election, (some of) the fiscal cliff issues, and we got another year extension on the short sale rules which allow sellers to conduct short sales and not be hit with an IRS bill for the discharged debt amount. The banks are reaching additional mortgage settlements as they extinguish the last of their legacy liabilities from the bubble. Finally, and potentially most importantly, the average person knows the crash is over, is tired of paying ever higher rents, and is no longer looking at real estate in a negative light.
I might actually not be bullish enough as all signs are pointing towards a strong 2013. We'll see in a few months how things are shaping up. The market is still essentially in hibernation for the next month or two.
It's amazing how frothy things are getting, with so few SFR listings: 710 19th St sold in July 2008 for 2.086m, now they're asking 2.6m!
ReplyDeleteAccording to latesummer's new math, that house should end up selling for about $1.2 million.
DeleteAnyone think they will get 2.6 for that grs lot
Delete2.6 is probably unlikely. Also, I don't think things are frothy at all. I don't see most people rushing to buy stuff they can't afford because they think they are going to make a killing. Buyers today are looking closely at their incomes, monthly payments, and rents. Anyone saying we are back in some kind of bubble is delusional.
ReplyDelete"but WC, people are going to get hosed when rates go up". Nope. I welcome higher rates because higher rates will most likely come with higher economic growth and faster increases in wages.
Even if interest rates rise, I'm hearing that so many have already refinanced at such low rates into fixed 30-year mortgages that they are more likely to stay put, thus decreasing inventory even more.
DeleteAll is not frothy, that's true. Look at troubled 902 25th St at Idaho Ave., 3/2, 1845 sqft home/8000 sqft lot in SM 90403. It's going on the auction block in Norwalk on 2/13, opening bid $1,175K.
And short sales seem to be the way to go nowadays, in more ways than one, like at 4242 Jasmine in Culver City 90232. What appeared to be a fishy deal back in June ended up with someone taking the bait and getting a 3/1 home in October for $610,000 in a nice neighborhood.
Persistence and patience appear to be paying off for some folks -- just 2 months later, "remodeled" 4242 Jasmine comes back on the market for $839K and is now pending. Sweet-smelling or is there still something fishy on Jasmine?
I sleep easy with my 5/1 ARM :) -- not the right product for everyone and all situations but rising rates is not something to really worry about right now.
ReplyDelete902 25th - That house has been in some stage of default for years now. Don't hold your breath for any supposed auction. Property taxes current right now (had been in default before I believe) so I don't think any kind of sale coming soon. Can kicking going on there. Who knows how it ends but whatever.
4242 Jasmine - It sold for well under market value in a very fishy deal. Word was that some large chunk of "cash" was required in addition to the supposed purchase price. Its a bummer to see fraud in broad daylight. Buyer is flipping it and it is now in escrow at a proper fair market level.
In both cases the takeaway is that average folks aren't able to get "deals" these days. Short sales? Yeah right...No bargains available on anything decent unless you are willing to commit fraud in some way. REOs; nope. Banks chillin and waiting for values to rise (smart if you ask me).
Hey there! this is a great report with some awesome info keep up the good work! Oh and by the way we are seeing the same things going on here in Reno...We sell 'em if we have 'em!
ReplyDelete-Daytona