Hat tip to Rick the Tuna for sending this article from the North County Times:
“The environment is really conducive to prices rising at this particular point,” said Alan Gin, an economics professor at the University of San Diego’s Burnham-Moores Center for Real Estate. “Interest rates are low, and prices are low.”
Most of the activity in the market is in the lower price tiers, where new homebuyers are trying to take advantage of the 38 percent decline in value since the March 2006 peak.
The index breaks homes into three price categories. The lowest category, comprising homes worth less than $297,000 in San Diego County, had the highest rate of growth for the fifth month in a row. Industry participants say tight supplies are driving up prices, with lenders slow to release foreclosed homes into the market.
I think there is always a 10% swing in what a home is worth.
If you’re selling and do all of the following – hire a great realtor, spruce up the joint, make it easy to see, and put an attractive price on it, you’ll get towards the higher end of the 10% range.
If you hire a lousy realtor, leave it ugly, make it hard to show, and price it too high, you’ll get towards the bottom of the range.
There will be more homes selling towards the top of the range when the market feels like it is heating up, but the internet provides all the data to keep buyers from going crazy and bursting out of that range.
It’ll seem like prices might be ticking up, but they should stay in the range. There should be plenty of supply just under the surface, waiting to come forth:
-
Defaulters
-
Loan Mod-ers
-
Short Sellers
-
Bank-Owneds
-
Expired listings from last year
-
Unemployed homeowners
-
Older folks who need money/no stairs
Don’t be buffaloed by any pundits who make it sound like there is a viable threat of spiking prices. There will always be an occasional lucky sale, and let’s face it – Southern Californians have a propensity to rush in and gobble up properties at any price. But there should be plenty of homes to go around.
Water table’s rising.
That is all.
Chuck
This bottoming pattern absolutely depends upon an immaculate recovery where jobs grow and interest rates do not. Where inventory trickles and buyers do not exhaust. Where banks keep lending and sellers accept less.
It is good. Don’t look a gift horse in the mouth and all that. Breaking log jams is always messy and dangerous.
In the long run I still see sellers likely to look back on this window as a special opportunity. A neighbor to my mountain cabin (Wrightwood 92397) is 1030 days on market. Price has consistently trailed market by 1-2 quarters. They could have sold anytime in the last three years for more than they can get now. That with no consideration of the time value of money.
What I am saying is that Jim has it right. Real Estate is not a 6-12 month retail sales activity. Preparation and pricing equals performance.
sorry for the off-topic, but there is a petition to stop Ben Bernanke if anyone is so inclined
link to petition
osidebuyer:
Good stuff. The 30% interest rate on cc balances, among other things, is criminal. Banks certainly are opportunistic. If everyone defaulted on their cc I wonder if we’d see another bailout?
p.s. I’m leaving Rockstar (you were the one at High Moon right?) and heading to the big Q. Cbad is a little too quiet for my taste 😉
Ron Dawg is back and as good as ever!
genius, yeah that’s right. although we are in a short crunch time right now I really enjoy it at this studio. Yes Carlsbad is kinda sleepy for my taste but still a nice place to be.
BTW, I’ve been reading on various industry sites about the ‘Rockstar wives’ letter and the near year long crunch over there with crazy hours. What is the big Q ? Qualcomm,or THQ maybe ?
Here’s a question to fall under “sprucing up”: How much is a remodeled kitchen really worth? Let’s say you have a fully functional, but dated, kitchen. Vinyl floors, formica counters, appliances from the Reagan administration (all working fine however). If you replace that with ceramic tile, granite countertops, and stainless appliances, how much more will you get if you sell? And will the additional amount of money be worth more than the cost of the upgrade? I believe that, in most, possibly all, cases, the cost of the upgrade will be more than the increase in the sales price of the house.
osidebuyer: Qualcomm. I’ll still be working on game / graphics tech, but for mobile hardware. I’ve had about enough of the ps3 to last a lifetime, and this coming from someone who likes writing assembly code. The R* wives’ blog really caused some commotion, but I haven’t really been around long enough to comment. Glad to hear that things are going well at your studio. I used to play bball on Fridays with some people from High Moon. Good bunch of guys.
Sign the petition – Stop Big Ben Now!!!