December 9, 2015

Buyers Attitudes Are Changing Dramatically

The Union Tribune reports from California. “Most San Diegans can’t afford to buy a home in San Diego. But that doesn’t mean local home sellers are out of options. The San Diego branch of Pacific Sotheby’s International Realty is working with a Carlsbad website that specializes in fishing for the world’s best buyer: Affluent Chinese who pay in cash, make deals happen quickly and are increasingly motivated to move their money out of the world’s most-populous country. San Diego State University finance lecturer Seth Kaplowitz said Chinese buyers are putting their money in the United States and other nations because it is a ‘hard asset’ — not due to high housing prices back home.”

“‘It provides them a place to run to when they want to escape, and they get the equity,’ Kaplowitz said. ‘Asian people, in general, are long-term people. Unless they flip it because they become more Americanized, they are going to hold on to that asset forever.’”

The Mail Tribune in Oregon. “The relentless flow of newcomers from the Golden State continues to feed Jackson County’s real estate market. A nearly 20-percent jump over the past three months in residential transactions propelled the median price for existing homes to $225,000, or 9.8 percent higher than it was a year ago, according to figures compiled by the Southern Oregon MLS. ‘My understanding is that the market is still solid down there right now,’ said Jacqui Robbins, principal broker at Finish Line Real Estate in Medford. ‘If it’s going well in Southern California, they’re still coming to Southern Oregon.’”

The Wall Street Journal. “Every day for the past six months Brian Christopher closely observed a swooning loonie. Mr. Christopher is a Canadian, who was trying to buy a home in Los Angeles, and facing a sharply depreciating Canadian dollar. ‘I’ve just watched it get worse and worse,’ he says.”

“Some Canadians continue to wait to see if the Canadian dollar will strengthen before they buy a home, says David Ivkovic, a Canadian by birth who is a realtor with Keller Williams Realty in Studio City, Calif. ‘Others just suffer the loss,’ he says.”

“As for Mr. Christopher, he finally bit the bullet and bought a Los Angeles home, despite his fears about the swooning loonie. Mr. Christopher, an actor, and his husband Marco Bianchi, a tech executive, closed on a three-bedroom house with a nice view in Baldwin Hills for about $995,000 in October. Of the loonie, he says, ‘We were hoping until the last minute it would go back up.’”

The M Report. “A recent survey from Redfin showed that home sellers are losing a bit of their ground in the housing market in the fourth quarter of 2015, therefore placing the advantage in the hands of buyers. The survey, which questioned 900 Redfin agents all over the nation in November, showed that only 6.3 percent indicated that sellers had all the power in the housing market in the fourth quarter, a huge drop from 35.5 percent in the first quarter 2015. ‘You wouldn’t know that the balance of power in the market is shifting by just looking at prices and inventory,’ said Jordan Clarke, Redfin San Diego agent. ‘However, buyers’ attitudes are changing dramatically. There are more bidding wars now than there were this time last year, but more homes aren’t selling for above asking price. Once the price gets too high buyers just walk away.’”

“Only 58 percent of Redfin agents noted that now is a good time to sell a home, the lowest number in three years. ‘Sellers tend to look backward, while buyers mostly look ahead,’ said Nela Richardson, Redfin Chief Economist. ‘As a result, more than a quarter of home sellers had to drop their prices in October. However, seller expectations will eventually come down to what buyers are demanding. It’s still a good time to sell, but just may not be as lucrative as many sellers hope.’”

The Tioga Tribune in North Dakota. “An incomplete occupancy survey conducted by the City of Tioga showed apartments are about 68 percent full. Advertised rates show rents have fallen somewhat since last year, but they remain well above national averages. Among the largest of the complexes in Tioga is the Olson Apartments and Olson Duplexes. Stacy Vejtasa, who manages the complexes, said they’ve been hovering around 60 to 65 percent full since the slowdown in the oil industry began last year. ‘We definitely have a lot of availability, which begs the question why are man camps still open?’ Vejtasa said.”

The Houston Chronicle in Texas. “Houston’s luxury housing market is losing some of its luster, a new report from Redfin shows. Luxury home prices here were down 7 percent in the third quarter, compared to a year earlier. The average high-end home price was $1.35 million, according to the report, which defines the luxury market as the top 5 percent of home sales.”

“Nationwide, luxury home prices fell 2.2 percent over last year. It was the first decline since 2012. Redfin said the dip could be attributed to a fewer international buyers or a larger supply of properties for sale. Scottsdale, Ariz., and Boca Raton, Fla., saw the biggest dip in luxury property values with 15 percent declines.”

“‘High-end buyers are usually not weighed down by rates, mortgages or competition from other buyers, but they do look for deals,’ Redfin’s chief economist Nela Richardson, said. ‘The luxury market was the first to recover from the housing downturn, and now it’s a bellwether of slowing price growth for the rest of the market. Sales at the top end of the market continue to soar, but prices are downshifting.’”

Bits Bucket for December 9, 2015

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