Low-End Sales Rocket in California

Once again misinformation hitting the media! What this article doesn't say is that inventory in California has decreased primarily due to lack of new foreclosures coming on the market. Like most REO brokers in California I have watched my inventory shrink month after month as moratoriums from various institutions have worked themselves through fruition. In addition the banks have been holding back inventory trying to change the Mark to Market valuation system. A quick look at the mls will tell you there is just nothing to sell at this point. Watch the reported inventory numbers for August. It should be off the charts.Michael HowardXcel Reowww.xcelreo.comwww.xcelinvestments.comMay 29, 2009With almost a 50% increase in year-over-year sales, the inventory of unsold existing single-family homes for sale in California has been cut in half, from a 9.8 months' supply in April 2008 to 4.6 months' supply this April, the state's Realtors reported. However, while sales were up 49.2% to a seasonally adjusted rate of 540,360 — the eighth straight month above the 500,000 level — the median price of houses sold in the month declined by more than a third, largely because the majority of sales were at the low-end of the market. "Inventory levels for homes in the under $500,000 segment shrank to nearly three months in April, compared with almost 10 months a year ago, while unsold inventory in the more than $1 million segment rose to approximately 17 months, compared with roughly 10 months in April 2008," says California Association of Realtors President James Liptak. "The dramatic difference in inventory exemplifies how the low end of the market is attracting more first-time buyers and investors, creating a shortage of distressed properties for sale." The median price of existing homes sold in the month was $256,700, a 36.5 percent decrease from the revised $404,470 a year ago. But it was 1.4% greater than March's $253,040 median price. CAR's figures are based on data collected from more than 90 local Realtor associations statewide.
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  • Hi Sueann. No not currently. All of my business is in Southern CA (LA, OC & Inland Empire)
  • Michael,
    Are you listing any of the REO in the San Jose Ca areas?
  • Yes Gina. If you look at the short sales in some of the higher priced areas you can see that most of these will be REO's soon.
  • We are seeing Pendings and Solds higher than Actives in Maui for the 300-500k range. In the upper market that is reversed. Do you see more REO properties coming on in the higher markets?
  • The only problem with that Johhny is that they WILL release all of this shadow inventory this summer and when they do....watch out.
  • Gotta lova the media...

    Anyways, I've said this before. I think the banks/asset managers/lenders have colluded together to slow down the foreclosure process to prevent more drastic housing declines. With the increase in FTHB activity, it's the only way to "make prices" go up again.
  • Thanks for the info Michael!
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