At least something sold
Hmm. I thought Peter was going to tell you he has today off but seeing no such post waiting in the wings I will break the bad news. No, we aren't holding him somewhere for ransom. He just has the day off. At least that's what he told me. If you feel strongly about that, feel free to cast your vote on whether we should ever give him another day off. I will start the voting: Against.
In the meantime, we will attempt, however feebly, to fill the gap caused by Pete's temporary absence. That said, I pulled some statistics from DMA DataQuick that might be of interest. Although there is information to be gleaned from monthly statistics, I often prefer to look at the bigger picture. Meaning accrues in duration, as they say. This picture looks at home sales for the first eight months of this year compared with 2007 in Southern California.
A couple of things popped out at the extreme ends of the spectrum. First, despite a dismal 28% fewer sales in L.A. County the first eight months of 2008, 35,685 homes did sell. Makes you wonder if perhaps this time next year, should sales slow more or even grind to a halt, that number will look pretty healthy. Second, sales in Riverside County are up by roughly that same percentage at just more than 29%. Why? Well, Riverside started the decline much earlier than L.A. County and there are a lot of foreclosure sales going on.
At other points in between are Orange County, down about 16%; Ventura County, down nearly 14%, San Bernardino County, down nearly 9%, and San Diego County, down 6%.
-- Lauren Beale
Thoughts? Comments?
Photo: Temecula in Riverside County. Credit: Don Bartletti / Los Angeles
Look at the numbers going back to the 80's and you see how weak the market really is. Looking back one year is not historical context.
Posted by: Cal | October 10, 2008 at 10:42 AM
It is amazing to me that there is still a lot of housing activity going on, when it seems like everyone knows houses are very overvalued, and going to drop another 25% still at least. Then again, I have to remind myself that I am not everyone, and the "average" person does not do nearly the research that I do, nor necessarily is able to analyze the market as accurately. Still, at this point you'd have to be kinda dense to not realize housing still has a long way to fall before it gets to parity with income.
That said, I am glad that there are knife catchers out there. Without them, the market would be at a standstill, and it would be much harder to gauge the price declines. You don't know the price of something until you sell it, and the knife catchers are constantly refuting the fantasy valuations many sellers still have. As they say, the free market is working well (at least while it lasts), and making housing more affordable for everyone.
Posted by: Nick | October 10, 2008 at 10:42 AM
I hope Peter picked up some good lodging bargain at the Ritz-Carlton in Half Moon Bay after AIG was exposed for planning to use our bailout money on some lavish gathering there.
I don't think it's appropriate for beggers lik AIG to act like they are the Rockefellers.
Posted by: MyLessThanPrimeBeef | October 10, 2008 at 10:44 AM
I guess Peter has to have a life, too. My vote: For.
Sigh.
Posted by: anonymous | October 10, 2008 at 10:52 AM
Peter's allowed to take time off? I'd've never guessed...
Posted by: Jim | October 10, 2008 at 11:28 AM
"35,685 homes did sell."
I'd be curious to see how that compares to, say, 1998 or even 2001. After a feast, a nutritious 800-calorie lunch will always look small. But if the 800-calorie lunch is what you normally eat, then there's nothing wrong with the size of the meal...
Posted by: Jim | October 10, 2008 at 11:34 AM
How many of those "sales" are actually just transfers back to the banks? I see an awful lot of Zillow "sales" where there is no human buying a home from another human.
I am convinced these "sales" numbers provided by the real estate industry are incredibly inaccurate.
Posted by: tonylogan | October 10, 2008 at 12:08 PM
MLTPB:
The Ritz in Half Moon Bay is expensive. We stayed there a few years ago with my son and his girlfriend. She was so shocked at the prices in the mini fridge we had to go to a grocery store to get her some gummi bears and Mr. Bubble. True story.
Posted by: anonymous | October 10, 2008 at 12:51 PM
Wasn't AIG at the St. Regis Monarch Beach? Come on, get your facts straight
Posted by: Wooster | October 10, 2008 at 02:53 PM
With no disrespect to you Lauren, and selfishly speaking, Peter should not be allowed to leave his work / computer!
The guy is an asset to the blog and LA times.
However, and since he is doing an excellent job, the guy deserves some time off, especially after the last two weeks of having daily bailouts, crazy ideas from our next president contenders, Stock market free fall crash....
Peter deserves to be with his family and enjoy some time of this mess.
Posted by: Laker | October 10, 2008 at 04:54 PM
Nick,
You are surprised that the average buyer does not realize the next 25-40% drop in LA housing prices...Don't underestimate the buyers. It is very obvious today even to many dumb buyers. There will always be knife catchers. Also there are still investors that are buying properties banking on rental income to cover partially their mortgage. Some use many illegal additions to rent multiple units and thus increase the rental revenue,
MyLessThanPrimeBeef ,
I actually think that having AIG to spend our tax payers money / bailout money in accommodation at that hotel plus all the drinks, cocktails, tips, etc is great for our economy. There will be some people that would be able to keep their jobs, get nice tips, afford to get home and buy their girlfriend nice flowers...At least the money will be spent and not hoarded in the AIG safe deposit box....
Let's spend our way out of this mess....
Posted by: Laker | October 10, 2008 at 05:28 PM
Hey, I am someone who is still in the market. I consider myself a smart shopper and investor who realizes that if I can sell for 85 cents on the dollar and buy for 60 cents on the dollar, I am still way ahead. Plus if you look around, there are a huge number of places available where there is really good cash flow. I was out of the market for years because I just couldn't find anything! that would cash flow. I think this is a really good time to readjust a real estate portfolio. Loans are out there at good rates if you can pull equity out from long term holdings and reinvest it. Of course, there are still the three basic rules of real estate to consider, location, location and location. Now is the time that stronger hands can pick up choice pieces from the fools.
Posted by: Gary Noel | October 11, 2008 at 09:54 AM
Laker,
Good point... We really to stimulate the luxury market... the only market Americans still master!
Just wished they'd picked me to do the stimulating...
Posted by: LA-renter | October 11, 2008 at 10:50 AM
Wooster:
Half Moon Bay was the intended site for the SECOND, upcoming luxury retreat for AIG execs. (And I IS expensive--I've been there as well.) This once supposedly has been cancelled after the first party resulted in a huge PR fiasco. Don't lash out until you do some research.
Posted by: Dave N. | October 11, 2008 at 08:12 PM
Remember.... not all houses are overpriced.
Some are even underpriced.
Posted by: Drew | October 13, 2008 at 05:43 PM