‘Take A Big Gulp And Understand It’s A Market Correction’
A pair of reports from California. “The listing on the studio apartment at 617 Cedar Ave. boasts: ‘This is the lowest priced unit in ALL of Long Beach!’ One would expect to find no properties for sale under $300,000 in Long Beach, where the median price is $485,500.”
“In fact, there are nine properties for sale in Long Beach for under $150,000. And if you are looking for properties for under $200,000, you’ll find nearly 20 for sale. ‘A year ago you probably would have found half that many properties listed for under $300,000,’ said (realtor) Dennis Berry in Los Alamitos.”
“Berry said he’s beginning to receive more phone calls from people looking to buy and sell foreclosures and fixer-uppers.”
“Berry said that there may be more foreclosure activity ahead as interest rates rise and those with adjustable rate mortgages see their payments kicked up after an initial five-year period of paying a fixed rate. ‘2008 is when you’re going to start seeing stuff,’ Berry said.”
From Realty Times. “In San Diego some areas are still doing well and some other parts of the country are stabilizing. ‘The slowdown is not uniform throughout [San Diego] County,’ says Alan Nevin, director of economic research for Marketpointe Realty Advisors.”
“‘Resale [properties] are off 15, maybe 20 percent. It’s really a matter of there being too many listings right now, but the listings will decline over the next three to four months as people take their homes off the market,’ says Nevin.”
“He claims it is a very dependable pattern that is about to set in. ‘What happens is that you get a whole bunch of people who think their homes are worth gold and they put them up for sale for high prices and then they sit for months and months,’ explains Nevin.”
“He adds that many of these hopeful sellers were really just trying to test the waters. ‘They didn’t really want to sell anyhow. So they pull them off the market and then the market gets back into equilibrium and that’s what’s happening right now,’ he says.”
“You’ve likely heard the buzz words ‘it’s a market correction’ that we’re experiencing, and we all know that being corrected is often a hard pill to swallow. So take a big gulp and understand that if you’re putting your home up for sale you’re likely not going to get the incredibly high market prices seen in recent years.”
Let me tell you what is really happening. I lived in Carmel Valley until last year, one the top areas in San Diego…next to Del Mar and Rancho Santa Fe, Torrey Pines High School and great beaches nearby. Well, I sold my home in a little tract called Cantamar last year for a little over a million. Now, the exact same house, with the same square footage (with even better views) in the tract are selling in the 800s. Pardee Homes is not stopping the development in the area and they are now cutting their prices on new construction which is pressuring prices in the entire area. New areas like Carriage Run, and Pacific Highland Ranch are seeing almost NO demand now so prices will be cut further. There are now over 500 homes for sale in 92130 and over 22,700 in San Diego overall. Sure the inventory will trend down into the Fall, but what about all of the new 2007 inventory that will kick up in January? San Diego is in for a HUGE correction and I am glad I got out when I did.
Congrats on your good timing. What tipped you off to sell when you did?
I sold because I saw 2 huge development plans had been approved, for hundreds of homes with similar square footage and I learned the pricing would be comparable and it freaked me out. I knew my 10 year old home couldn’t compete with new construction. People in SoCal LOVE “new.”
People in Texas are the same way, which is why I never bought a tract home or a home in any new subdivision. Around here, newer is always better and people will happily tear down beautiful historic homes to put up tacky McMansions.
Sold Out, well done, great timing. We sold our house in UTC for a little over $800K June 2004 and are now renting right by Pardee’s Carriage Run development. When I drive by there seems to be no one visiting the models, same with Pardee’s other two developments, Derby Hill and Saratoga(I think) located about 300 yards away. Pardee have milked the Carmel Valley area for the past three years. The Airoso development by Standard Pacific Homes has many new units for sale, plus some by owners. One is being sold that was bought last year and is currently priced about $40K ( need to check exact numbers) less than they paid…still no takers and SPH have new models priced less with additional incentives.
Yes, let it get back to equilibrium. That will be around 50% lower than the peak (give or take 10% either way). Whatever these sellers ‘testing’ the market do, don’t sell until your value has dropped by at least 50%. Of course, those aren’t the folks that will be forced to sell due to ARM resets, lost jobs, family issues, floods, earthquakes, etc.
On all price levels, right? That’s how I feel.
It’s really a matter of there being too many listings right now, but the listings will decline over the next three to four months as people take their homes off the market,’ says Nevin.”
But if they can’t afford to make their mortgage payments how can they afford to take their homes off the market, Nevin?
What makes you think they can’t afford the payment?? As stated earlier by someone else on this blog, “a lot of homes on the market are just testing the waters”. This is when it starts to get interesting…
Usually homes for sale “testing the waters” aren’t empty. In the south bay part of Los Angeles about 30% of homes for sale are unoccupied listings (my estimate from touring open houses). I some how doubt these people will stop trying to sell their home. Oh, they might rent for a year at a small loss…
And why will inventory decline in the winter?
Ocrenter’s excellent blog shows that in 2005 Inventory grew through the winter in Pheonix, Riverside Country, San Diego, and other locations. Ok, a small December drop that was made up by February can be seen. But last I heard it isn’t until March 20th or 21st that Spring starts…
http://bubbletracking.blogspot.com/
I must agree with later posts… this time the “dabbler” argument is a straw man’s argument. Remember in 2005 the median down payment was 2%.
People will walk away. We saw it big time in the mid 90’s. We’ll see it again.
Neil
Look, we may see inventory levels come down in the fall and winter, but this is normal. What we really need is seasonally adjusted figures, but I haven’t seen anything like this. Even if listings fall in the off season, they may still be larger than the summer season on a seasonally-adjusted basis.
There are presumably some number of people who bought another home and still need to sell the first, and can’t for whatever reason. All the other usual reasons people buy and sell houses (job changes, family changes, etc.,) don’t necessarily wait for the market to be most favorable.
“‘Resale [properties] are off 15, maybe 20 percent. It’s really a matter of there being too many listings right now, but the listings will decline over the next three to four months as people take their homes off the market,’ says Nevin.”
It appears as though Mr Nevin hasn’t considered the resets that will kick in between now and the end of this year. I wouldn’t expect inventories to decline substantially, as the FBs notice $1,000 increases in their mortgage payments and decide to GET OUT BEFORE THE NEXT INCREASE.
Defaults & freclosures WILL be shooting up.
I think this is an interesting topic in regards to the inventory build we have recently seen in CA. Right now San Diego has a population adjusted record high inventory of 22,700+ (bubbletracking.blogspot.com). Nevin is probably correct that many people are testing the waters right now to see of they can get bubble prices. They obviously can’t. But the issue of resets is real. So as the people testing the waters are pulling their homes off the market the people who really have to sell will be putting them on the market. Thats when we will start seeing the real YOY median price decreases of which have already started in SD (piggington.com). I don’t expect the inventory to decline that much and the inventory that is going on themarket from this point on won’t be testing any waters, these will be serious motivated sellers.
I agree that inventory won’t be going down much. I actually expect inventory to keep rising just like it did last year around the time the “experts” said it would fall. After Thanksgiving, inventory did fall a bit, but then turned back up after the 1st of the year.
I actually met one person that was “testing the waters” several months ago, and has since pulled his house off the market because he couldn’t get his price. He was basically asking for 100% appreciation in less than 2 years. No, that’s not being greedy!!! I still think that there is a relatively small number of people that fall into the testing the waters category, though.
Besides, when depreciation really starts kicking in and all of the paper gains are quickly vanishing, we will see a lot more motivated and comitted sellers as you have mentioned.
Spoke with a local realtor lately, said a nice property is coming on the market because the owners have extracted equity over and over and are now nervous about their finances.
I think a lot of folks are in way too deep. When we were thinking about buying we were blown away by the amont of money the bank said they would lend us - we would never have considered even looking in that high of a price range. It was puzzling until we started researching the housing bubble.
Testing the waters is another false canard, much like rising rents. Inventory is exploding, and people HAVE to sell. Would you test the waters with inventory at an all time high? Do you feel lucky punk? And inventory is being reported as over 25K on other websites that cover San Diego (helpusell, sandiegorealestatecentral.com, etc.)
“He adds that many of these hopeful sellers were really just trying to test the waters. ‘They didn’t really want to sell anyhow. So they pull them off the market and then the market gets back into equilibrium and that’s what’s happening right now,’ he says.”
There are far rewer of these type of sellers than there was last Spring. I’d say now there is far more that NEED to sell, and that group is growing daily. I’ve watched many properties drop off MLS a few months back with the thinking that they would just kick back and let the inventory push through. It’s a gamble that hasn’t paid off, because I’ve seen most come back onto the market in tha past few weeks, many below their old list price. They should’ve kept it on and reduced it months ago, but stubborn stupidity wins again.
Oh, Alan, don’t bet the farm on inventories dropping over the next few months.
Seeing the same thing on my local MLS. Especially on the high-end (over $500k).
It’s nice to know that over $500K is still considered the “high-end” in some places.
I agree… at least from my own observations, people “testing the waters” don’t have their home up for sale for a year straight with over a half dozen price reductions, chasing the market.
I wouldn’t just focus on the sheer inventory of homes on/off the market. I believe a telling stat would be to check the number of homes that have had multiple price reductions. In my opinion, I believe everytime a price is reduced, it’s just like adding another home on the market.
That’s the sign in Seattle- price reductions. 25 - 50% price reduced in nearly every zip in the city. Inventory’s not THAT much higher than ususal. Although there’s a lot of new construction coming down the pike for midsummer and Fall.
Makes you wonder what’s going to happen when the new inventory comes on the market if so much is price reduced now without it.
I don’t have time to post right now. I’m off to list my house to “test the waters.”
Gee, I hope it doesn’t sell, I rally don’t want to move.
I’ll maybe make you a 50% lowball offer.
I’m just testing the waters- I hope you don’t accept my offer as I really don’t want to buy.
That’s it! My new business!
I’ll bring together people that don’t want to buy or sell!
I’m only charging a 4% commission to my first customers! If you aren’t really interested in buying a home or selling yours… contact me today!
“So take a big gulp and understand that if you’re putting your home up for sale you’re likely not going to get the incredibly high market prices seen in recent years.”
Sounds like he’s predicting a pretty big correction if the “recent years” (2? 3? 5?) were all too high.
Indeed. If these sellers get 20% off the “peak” price, they’re still getting a great price.
“In fact, there are nine properties for sale in Long Beach for under $150,000. And if you are looking for properties for under $200,000, you’ll find nearly 20 for sale. “
Okay westcoasters - what kinds of homes would these be?
Right, would like to hear more about Long Beach, from locals, Pls.
Worked for a service in1976, picking up coupons from markets and liquor stores. In one store on Anaheim Boulevard in Long Beach, the clerks wore guns in holsters, visible to the patrons and would-be-robbers.
Amazed and awaken to the reality of the regularity of holdups in that area, I decided to never think about buying or renting in that area. Has it changed?
nope. Still the same. Have an amusing ancedote. Back in 70,s when I was attending high school in Long Beach we all used to make jokes about the “working gals” plying their trade along Pacific coast hwy. In fact the PCH section thru Long beach almost to the traffic circle has not changed one iota since the 70,s and the “gals” still stroll along PCH to this day.
Clarifying my question: The article states, “Most of the properties are ‘own your own’ single-unit apartments or condos in less-than-desirable areas.” Knowing pretty much nothing about that area, how undesirable are we talking? Like true ghetto stuff? And/or bars-on-the-window? Just curious. In Philly, there are sections I wouldn’t pay a penny for (North Philly being top of that list).
Just check out http://www.realtor.com old sport…they’re ~400 sf apartments, so nondescript that only two of them even have pictures, and lousy pictures at that. What realtor.com won’t tell us though is how lousy the complex & neighborhood is.
Okay westcoasters - what kinds of homes would these be?
The kind that should be torn down.
These have to be in the “HOOD”. Bring your appropriate color!
Great Places! Nice family setting too! (if close proximity for real-time 24X7 access to meth & crack acquisition are top purchase considerations)
I live in Long Beach. The property in question is on the 600 block of Cedar. I would not live there….definitely not by myself. Nope. I would say it’s the ghetto but I don’t think it’s a hard ghetto. Just 6 blocks down is downtown which has changed for the better in the last 10 years…it’s beautiful and people go there to have fun, eat out, etc etc. But that is how so much of my area is….one or two blocks away, and you have a completely different neighborhood. I would be willing to bet that this part of Cedar Ave has bars on it’s windows and quality of life issues.
Put it this way….this block of Cedar I don’t believe would be on anyone’s top choice list. The safest parts of LB are East Long Beach. I live in a historical district, close to the water, in between East and West.
Reminds me of an experience I had with a realtor a week or so ago. She lives in beautiful and safe Belmont Heights but was telling me, a single gal, of a “great rental” on Willow and Long Beach Blvd. It bugged me….no matter how good the rent or how great the upgrades…no single gal like myself should live there. She called the area “working class”. Yeah, right. It amazed me how she was so untruthful land totally unconcerned about my or anyone’s safety in living there.
Your description of LB kind of reminds me of Santa Barbara. I visited a friend there 3 years ago (she had owned a loft that she bought in 1996 for somewhere in the $190s), and I was surprised at the neighborhood. If anyone reading knows SB, I’m talking about W. Gutierrez and De la Vina St. It’s only maybe 3 blocks or so from the main drag downtown, but I was not impressed…. not exactly a “bars on the windows” kind of area but close enough for me. Maybe it’s different now…Idon’t know. And it butts up against the freeway (Highway 101). But, just down the street they were converting a building to condos and at that time they were asking in the $700s. Zillow shows her bldg in the high $500s - mid-$600 now. There is also a 1/1 420 sq st house that Zillow is showing for $734k! When she bought her loft, that house was in the $150s.
Well, I forgot to mention that my friend sold a couple of years ago…mostly because it was very difficult to find work that had good benefits or that paid you enough so you could pay your bills. She originally bought it for her daughter who was going to UCSB at the time, but she moved there from the Bay Area after her daughter graduated because the BA was making her crazy.
Ironically, she is back in the Bay Area….AND she found a job in no time.
BayQT~
Not to defend SB (which is overly arrogant about what a paradise it think it is), but parts of Long Beach are truly scary. There are rough parts of SB in the various barrio and homeless areas, but no place I would be terrified of walking through at night.
I hear ya, East Beach. Point taken. I don’t know if you are a guy or a gal, but there is a clear difference between a woman walking through a particular area at night, and a man doing the same alone. As a woman, no, I wouldn’t be terrified, but the street didn’t really strike me as a take-a-stroll-downtown-at-10:30pm area. On my visit I didn’t stay the weekend so I honestly can’t give you really, really good assessment…just for the few hours I was there.
Didn’t mean to offend if I did. (hand shake and a hug
)
BayQT~
Long Beach, isn’t that where Snoop Dogg and Warren G grew up slinging rocks? It’s the oil refining center of the west coast as well…very industrial. There’s definitely no comparison to Santa Barbara IMHO.
I haven’t lived down there for a few years, but as I recall, at least half the buildings in LA (including some very swanky neighborhoods) have bars on the windows, so I’m not sure that’s a great litmus test to apply.
For that matter, I live in a perfectly pleasant and quiet neighborhood in San Francisco, and there are bars on my windows (2nd floor apartment). It seems like a perfectly natural and reasonable precaution to me. I would imagine that any landlord that didn’t put bars on the windows might in fact be liable if the place was broken into.
THIS is the California that people are perpetually willing to pay a premium to live in?
Not a native but I’ve been a Bay Area resident for 32 years…I would never consider living in an area (ANY area)behind barred windows.
BayQT~
Not a good area at all, corner of Long Beach blvd and willow. Only thing to recommend it is that the blue line station is right there, with easy bus connections. Long beach does have an excellent bus metro system, one of the few positive things i have to say about LB.
Within a block or two of the beach, you’ll be ok. Otherwise, listen to Snoop Doggy Dog rap about the “LBC” to get some idea.
http://presstelegram.com/news/ci_4031909
Yes, Snoop Dogg is from the “LBC.” Don’t let the “beach” in the name fool you — parts of Long Beach are as ghetto as it gets. And you don’t have to go very far from dowtown. Like maybe cross the street.
I know there are middle class areas of Long Beach — a former coworker used to live there — but I have never actually seen them. Even the apartmens along the beach aren’t particuarly desirable. Remember that scene in the first part of Scarface, when Al Pacino drives to an apartment of Miami Beach — one right on the ocean — and is forced to watch his brother get dismembered with a chain saw? Picture that same neighborhood on the West Coast, except make it 50% more crowded, dirty, and dilapidated. That’s Long Beach for you.
actually, that movie was on TV last night. I think the Bravo channel. Let’s just hope FBs don’t start showing up at their Realtors’ office, packing heat and shouting “Say hello to my little friend …” Could get ugly.
Okay, folks, I live in Long Beach and I just drove by 617 Cedar Ave. It is not as bad as I thought. The street had it’s hey day in the early part of the century. The street and houses are nice. It’s wide and spacious, the houses have character. I do feel it’s “urban” but not a ghetto. I feel it’s in an urban renewal area. I saw a Prius in the driveway of one of the very nice homes which tells me a upper class or educated moved in? I think a lot of buyers went to places like this street to buy.
Anywhoo, the property in question is part of what used to be an apartment complex. Actually, the building looked decent. It’s a 70’s building I would guess but still attractive.
So from what I gather, the neighborhood is not horrible and has some charm…but it is still way overpriced.
Okay, folks, I live in Long Beach and I just drove by 617 Cedar Ave. It is not as bad as I thought. The street had it’s hey day in the early part of the century. The street and houses are nice. It’s wide and spacious, the houses have character. I do feel it’s “urban” but not a ghetto. I feel it’s in an urban renewal area. I saw a Prius in the driveway of one of the very nice homes which tells me a upper class or educated moved in? I think a lot of buyers went to places like this street to buy.
Anywhoo, the property in question is part of what used to be an apartment complex. Actually, the building looked decent. It’s a 70’s building I would guess but still attractive.
So from what I gather, the neighborhood is not horrible and has some charm…but it is still way overpriced.
Did you happen to see any of the residents?
Yes, I did. I saw one Anglo fellow outside his house, I presume and then I saw a Latina and her son? But this neighborhood did not seem bad…and I’ve been thru bad. I did not see young men hanging around…it seemed peaceful and quiet. Also, it wasn’t far from some developed lofts…the lofts are amazing. I can’t wait to buy when the downturn happens. The “bones” of the street, the wide street, the houses, etc…are not ghetto. It’s a cute historical, old neighborhood that would be an AMAZING area if noticed. The thing is, the schools are not be desirable, IMO.
Yes, Long Beach DOES have scary areas…but also some amazing very desirable areas. I love where I live…it’s ecletic, walking distance to two cute coffeehouses and cute retail on Broadway, I feel safe walking at night….lots of dog people, active neighborhood association, antique stores, near water, near museum on the water…near amazingly beautiful Ocean, 1st and 2nd street.
I guess the point I am making is that there are very bad areas of Long Beach, less bad, fair, gentrified, historical, safe, over million dollar range…Long Beach is very diverse….just see the whole thing before you judge. Also, I think the apartments and condos on the cliffs by the water are very beautiful and very desirable to live in…I just haven’t done it.
That part of Long beach where 617 cedar ave is located is known as the Wilmore District, which runs from the LA river to pacific ave and from PCH all way to ocean blvd. Lots of recent condos developments in that area. Also there are still some turn of the century old clapboards still left.
The LB police station and city hall right down the street. Not saying that area totally bad nor good but the problem areas start maybe further up toward anahein street/PCH. Yes, LB does have some extemely bad areas, but Downtown may be changing its tune these days with all the recent Pike /hi-rise condo works going uo along broadway/pine ave/shoreline drive.
On the dark side, DWTN pine ave has seen a lot of turnover /closings of shops, the quaint shoreline village and the new shops and eateries of the new pike.dwtn harborwalk are having problems getting traffic. There are some nicely restored old boats and sloops which provide harbor cruises, including a restored mississipi paddlewheeler which docks right nect to the Aquarium Of The Pacific.
What DWTN LB needs is easier access for visitors and tourists: the LB/710 frwy is among the worst fwys in SCal as far as clogged traffic jams due mainly to port trucking operations. Also, having the hugh port with all those cargo ships , cranes, and cargo containers right next to dwtn is somewhat of a downer.
Yes, Condo prices are declining in LB dwtn as the RE bubble starts to fizzle. The LB press Telegram cited by Ben shows 20 properties for sale under $200.000. These would be tiny shoeboxes in extemely
bad areas(e.g.area near cherry and 10th, all LB north of Del AMO, westside LB near SAnta Fe ave and south of willow/pch, Parts of wrigley district, east-central LB along alameda st/orange ave up to willow, ad nauseum).
they would be 400-500 square ft 1 bd/1 bath shoeboxes on 2000-3000 sq ft lots located in some of LB’s worst areas:
1. Much of North LB from del amo/railroad tracts all way to artesia. Areas along Altantic Ave and Long Beach blvd
especially undesirable.
2. The area from pacific coast hwy to 10th and from alamito ave all way to temple.
3. Most of the Westside especially that part south of Willow/PCH and all of westside immediately adjacent to Santa Fe Ave.
4. Portions of Wrigley District between 10th st to willow and from the LA river to signal hill.
You can pan on zillow and watch what sections of LB are seeing the price declines.
Long Beach has an abundance of Small(under 1000 sq ft)older SFH’s between 50-100 years old which may be suitable starter homes for working class young immigrant familiies
who do not mind living in older declining areas areas which are abundant throughout LB.
“Berry said he’s beginning to receive more phone calls from people looking to buy and sell foreclosures and fixer-uppers.”
Knife-catchers. Let me know when you have been receiving fewer calls — for six to twelve months.
Agreed. I got some spam email from foreclosures.com saying “NOW is the time to invest in foreclosures!” Maybe in 12 months it will be.
LB crashed the worst during last 90’s bubble. It same Cedar Ave hood I bought many condos in the 40k-50K range in 1999 ! My best was on Orange Ave condo for 27K !!! Was near $300K at the peak last year !!
One of the drivers of this housing bubble is that everyone thinks they can play Bob Vila and Donald Trump.
Well everyone can. Trump is a self promoter who can’t seem to make a casino turn a consistent profit and goes bankrupt everytime there is a recession and Villa is a nincompoop who slows down the contractor doing real work by either asking stupid questions, making a mess, or both. Sounds like most amatuer real estate investors to me. The problem was that everyone thought that they were Sam Zell and Norm Abram.
Bob Casagrand is just out with his always excellent, no BS analysis of San Diego market conditions. Some key comments:
* The “peak” buying season was worse than the winter 2005 season, something that’s almost unheard of.
* June down 33% YOY in sales
* Early July is on track to be an outright “disaster” — using his words.
Read more here:
http://tinyurl.com/cy9eu
He’s waaay too straight shooting to last in this biz. People don’t want the truth.
i like the part about 30% of the inventory being vacant. those people aren’t desperate, you know, they’ll just wait for the hot market to return.
Not only does he shoot “too straight,” he seems to be honestly rating the market.
Market condition a “2″. (Not quite yet a buyers market… I’d agree with that.)
Current Price trend a “2″ (falling but not fast, again, I agree).
from the link: “debated about putting this in this writing because the numbers are scary ” Whoa! A realtor honest enough to say things are scary? Wow!
“30% of our listings vacant” FB’s for sure. I see a ton of vacant homes in the south bay. These people are going to get toasted.
The only question is when does the stampeded for the doors start? I’m thinking after school starts and sellers “wake up” to how few real buyers are out there…
Neil
OT, but relates to San Diego…
Looking to rent a SFH in North country within next 6 months.
Commute,jobs, schooling not an issue…quiet,some space and lack of major congestion are priorities. Besides pricey Rancho Santa Fe, any suggestions of towns/areas would be appreciated from informed locals within rent budget of 3 to 3.5k per month. Also any brokers/property management companies specializing in rentals you would recommed? Thanks
Carmel Valley and Del Mar are real nice with good freeway access to I5, I805, I15…$3K/month will get you something very nice…even $2500 will likely get you a 3B/2B home will pool etc….check out zip 92130.
Weeksy,
thanks much for the info…will check out.
Hi az,
I’m gonna play your conscience here for a minute. Is the $3-3.5k a little below the amount you can pay for a rental? I’m not from SD and have only visited there, but if you can find something in the $2,500 range as was mentioned, I would go with that. The reason why I ask is because I am a true believer in leaving below your means…even if you really can afford to go higher. Ok….so you CAN afford it. What if there is an illness or a job loss between you and your spouse (that is, if you are married and are including both incomes)? Would you be able to handle a $3,500 housing expense along with all the other living expenses?
Just some things to think about. If you can find a nice place for less money, that’s the way to go. Try not to paint yourself in a corner.
My (friendly) 5 cents….
BayQT~
Dear sfbayqt,
good common sense and practical advice taken seriously…am too a believer in living below means and adjusting accordingly…appreciate your “heads up” and reality check.
My pleasure, my friend.
BayQT~
leaving=living. Dang it! I hate when that happens. LOL!
BayQT~
As everyone has said, there is no reason to pay above $2500 and you can probably find lower at this point. It seems everything is for rent here recently.
Check out Cardiff, Encinitas, and South Carlsbad/La Costa
Lots of stuff for rent in the 2200-3000 range…check craigslist for San Diego and search by these cities.
I just rented a place in La Costa in May for $2200 4/2 SFH ~1700sq ft on .25 acre nice backyard, gardener, water/sewer/trash included. Not sure where in Del Mar you will find a house with a pool for $2500 (more like $3000+)…I was looking in these areas for 3 months before I found mine.
If you like the country, try Valley Center.
Zip 92082
west long beach is an extension of wilmington, compton and watts.
kind of like bronx and harlaam are separated by a thin river
The thing about Long Beach is that it really should gentrify. And parts of it are gentrifying. But the rest is sitll a total dump.
And even in the good areas, gentrification is a real challenge. A lot of the beachfront apartments/condos, for example, really should be renovated. But they are very small, so small that there is really no point in doing the granite countertop and stainless steel appliance thing. To really improve them you’d have to do teardowns and build new, more spacious units. But so far, no one has done this, so even a lot of the beach areas are still really cheesy. Not dangerous, but hardcore working class.
If Long Beach was gentrifying more rapidly, I’d probably move there myself. It’s got a lot of potential. But it also has a long, long way to go.
With all due respect, I don’t think you know what you are talking about. Long Beach has the worst ghettos but also many, many beautiful areas. There are many historical homes…the same ones you want to tear down and put up homes that are more spacious but lacking in charm. All the homes near the water are very desirable now…ALL of them. In the past, this wasn’t the case…but it is now. And this isn’t because of the bubble…this is because the neighborhoods are beautiful to walk in and have character.
If you have not seen the lovely neighborhoods in LB you have not looked very far. Yes, there is a part that is an extension from Compton and Watts but that is just a portion…and portion I have rarely gone thru. There are many streets with lovely palm trees, Craftsmen homes imaculately renovated, wide tree-lined boulevards….and the East side…many nice, safe suburbs and then the very expensive and desirable homes in Naples on the water.
I personally live half way from Belmont and downtown and we have the greatest Neighborhood Association. They work hard at keeping the homes historical and our area looking nice. They have so much style, too. We had the best, most gorgeous, most beautiful, most creative Fourth Block party ever.
I guess my point is this….much of Long Beach doesn’t need gentrification…it has been and will continue to be nice. Only small parts are gentrifying but with success. So, please, know your facts and see the whole city before you makes such comments.
This gentrification pattern will reverse course in a heartbeat as soon as the plunge hits, if it takes even that long. Were you in LA during the last LA riots? Get ready for a repeat, as soon as money gets tight and the FBs get tossed out on the street. It wasn’t by coincidence that the riots happened once the CA RE downturn was in full swing. Expect it to be much much worse this time and being in Long Beach, the border between the have-a-little and have-nots (GROUND-ZERO FOR RIOTS) is right there.
Well, I agree that racial tension is always a possibility…however that can be anywhere. Also, it’s mostly the middle class that will suffer regarding the bust than the poor. The poor are renters, not buyers for the most part. They are partaking in this kind of investment.
I have to disagree with your “gentrification” part. If you took walk on the beach path and looked at all the apartments on the cliffs….they would be UGLY if they were made new. What makes them special is their old style. The newer apartment buildings are the ugly ones for sure and add nothing. Just my opinion…but many feel the way I do and that is why LB is adding historical neighborhoods and protecting what we have.
Look, I am sure there is a downturn, but I do not wish chaos on any city or people. It could happen but truly the losses are not with the poor, they are with middle class people who do not riot. Would you like to see rioting happen? I get the feeling from your post you would.
Of course not. But hoping riots won’t happen and parking yourself on the doorstep of where it will occur if it does simply doesn’t make sense. I doubt you wish to get into a car accident but that doesn’t mean you wouldn’t carry insurance. Same principle applies…
Your error is in thinking that poor Negroes and Mexicans won’t suffer, just middle class White folks. It’s like thinking 300K houses won’t see prices declines, just those between 400-800K.
Not only will they suffer, they will suffer first. Boarded up homes and further despair in the downtrodden areas will likely lead to a repeat of what happened in the ‘94 timeframe during the last RE downturn in LA…
“poor Negroes and Mexicans”
What about the poor whities, or the middle class… minorities?
I lived in L.A. during the riots following the acquittal of the 4 policemen who beat Rodney King, that was April of ‘92; this is the first comment I’ve seen linking that violence to the real estate downturn, which I believe was just beginning, and lasted until ‘98. I tend to think the upcoming downturn will lead to increased domestic violence, broken marriages, alcoholism and the like. I would be surprised to see minorities rioting because of a RE decline.
During the last riot of 1992 about 10,000 buildings in LB were torched. LB is actually a microcosm of LA with the same old innor ring of decaying slums immediately surrounding the DWTN area. In these areas are the cities impoverished. Go down to the beach on cherry ave on weekends and you get an idea of the “diversity” of peoples and races in LB.
I am not against diversity of folks inhabiting a city but how can LB spend humongous sums of money building up the dwtn without attracting the high-income wage earners necessary to provide the necessary discretionary income needed to bolster dwtn spending, and keep all those newly-built stores and facilities financially feasible.
LB has repeatedly torn down and rebuilt it’s dwtn last 30 years, and always has run ibto fiscal difficulties. The shoreline village and queen mary have been into BK repeatedly. The new pike development is in fiscal deep water.
As far as maintaining its historical bldgs LB rates very poorly. Nearly all of it’s old historical dwtn structures were torn down during last big develoment binge of the 80’s, and very little remains. LB has almost wiped off all of it’s old turn of century bldgs and turned dwtn into a hollow urban shell.
I think you are being excessively negative. Yes, many older homes where bought and then they put up apartment buildings but there are historical homes still everywhere. Everywhere I walk I see very attractive older homes with style. And the streets are walk are lovely….granted I certainly do not walk in the bad areas…but to say it’s a “hollow urban shell” is just being negative.
Well, if my neighborhood is a “hollow urban shell” it sure is nice to live in! I have at least three cute coffeehouses I can WALK to. I can walk to the beautiful museum on the cliffs. I can walk by myself. My neighbors love to keep up their homes and gardens. Many are active.
I am having a hard time believing about downtown, too. I was there today and was amazed at the professionals out having lunch outside walking around. There is a hair salon that charges over a 100 dollars a cut. The FM Bank building was bustling and the building beautifully restored. I enjoyed being out today. Lots of people with dogs….gorgeous lofts…yes they are overpriced now but in the future I’ll swoop in.
Long Beach has a lot going for it.
Actually Long Beach is filled with people who “have a lot” not just “have a little”.
Yes, I was in LA during the riots. If I remember correctly it was sparked by the Rodney King trial. I do not believe real estate fall was the motivator. Nope. I believe it was all Rodney Kind and just a cascade after that.
If that was true…why didn’t they riot at 1995 when prices were rock bottom lowest? Hmmmmmm? The reason is because the poor are not real estate speculators and they don’t have to suffer so much in this way. In fact, I think few are even AWARE of any real estate downturn as they are mostly renters. They may even get happy when rents GO DOWN.
This is an old thread, but the environment which “encouraged” rioting (for any reason) could well have been a recession. IMO, rioting is very rarely caused by an actual event. I feel the anger is already there, waiting for a trigger as an excuse. During a recession, those who have the fewest resources will feel it sooner and harder than the rest of the population. That is why the crime rate rises during bad economic times.
The Rodney King “incident” (and so political at that) was simply an excuse for people to vent their frustrations on “society” in a very violent, wasteful and harmful way. It’s things like this (riots) which trigger so much racism, IMO. It showcases the (violent, gang-like, criminal, etc.) behavior which justifies racism. If black people wanted to eliminate racism, the law-abiding black citizens would knock these punks out and show how opposed they are to that kind of behavior.
“He claims it is a very dependable pattern that is about to set in. ‘What happens is that you get a whole bunch of people who think their homes are worth gold and they put them up for sale for high prices and then they sit for months and months,’ explains Nevin.” ‘They didn’t really want to sell anyhow.
Just another idiot with another idiotic theory. Yeah, right, no body wants to sell there home right now. We are in the “testing the waters” phase of the market. Nothing new here…please move along. Please tell me this guy did not graduate from SDSU - I will be thouroughly embarrassed as an Aztec alumn.
From RealtyTimes contributor Bob Casagrand:
Second Quarter 2006: San Diego Housing Market - single family detached and attached homes: June home sales were 2,947, down 33% from June 2005. The second quarter sales were 8,822 homes sold down 30% from the second quarter last year. As a matter of fact our second quarter sales were slightly below the fourth quarter of 2005. Who would have thought that the peak April, May and June months would have lower sales than the winter/holiday months of October, November and December. That provides a very good picture of what has happened to the demand for housing. The inventory on July 1 stood at 22,049, up from 20,635 a month earlier. For the past few months we have been adding inventory at a rate of about 1,500 homes per month. The growth has been caused by the decline in demand having homes stay on the market longer, causing new listings to stack on top of the unsold listings. One of the major issues for our market is what does the future demand look like, and only time will tell. I did a rough check on July to date (July 9) to see where it stands, I debated about putting this in this writing because the numbers are scary and they will close somewhat by the end of the month. I decided to put it in so that we can see the mountain ahead to maintain some level of reasonable demand. The first 9 days of July have 303 homes sold for an average price of $559,577 and an average size of 1781 sq ft; the first 9 days of July 2005 had sales of 933 and an average price of $629,168 and an average size of 1749 sq ft. Last July’s 933 sales represented 25% of the month’s sales, if that were to hold this year, well suffice it to say that would be a disaster. I think this July will stay in the 30% to 35% down from last year region and that would put July sales at about 2,700 homes sold, keeping us a path to about 30,000 home sold for the year, down about 30% from last year.
Junes’ average price was $638,380 up 3% from last year. However, this increase is explained by the fact that the over $1 million sales represent 10% of June total sales where they were only 8.5% of last Junes’ sales. When you break down the sales into price & sq ft segments you see a completely price flat market. However, there are neighborhoods already showing price declines of the 4% to 5% region and I expect to see this show up in the overall county statistics. Markets can not sustain 30% declines in demand over a period of time and not have price erosion. Here is a trend to consider; sales in the fourth quarter of 2005 was down 10% from prior year, sales of the first quarter 2006 was down 20% from prior year and the second quarter of 2006 was down 30% from last year third quarter of 2006 ???, anybody’s guess. Another issue that will impact price pressures is that about 30% of our listings are vacant and heaven help the Fed continue to raise interest rates. Help comes in the form of something that will increase demand or reduce inventory.
I can’t believe the other realtors haven’t rolled him in tar and feathers yet… Golly, this guys is speaking the truth. Isn’t there a law against that?
I go on your blogsite bubble meter blog to keep up with the latest housing tracking stats for Scal counties. You are the best source for tracking REALTIME STATS.( You may find my posts at your site under “road hog courier”)
I tried ziprealty but they seem to lag behind as far as latest updated housing listings and sales.
Keep up the good work.
Okay, folks, I live in Long Beach and I just drove by 617 Cedar Ave. It is not as bad as I thought. The street had it’s hey day in the early part of the century. The street and houses are nice. It’s wide and spacious, the houses have character. I do feel it’s “urban” but not a ghetto. I feel it’s in an urban renewal area. I saw a Prius in the driveway of one of the very nice homes which tells me a upper class or educated moved in? I think a lot of buyers went to places like this street to buy.
Anywhoo, the property in question is part of what used to be an apartment complex. Actually, the building looked decent. It’s a 70’s building I would guess but still attractive.
So from what I gather, the neighborhood is not horrible…but it is still way overpriced.
I live in the east part of Long Beach. East of the traffic circle and on the beach and island is very expensive. North Long Beach is nothing but black gangs and neighbors Compton. West Long Beach is old, industrial and beyond redemption. Downtown is a combination of new glass and concrete buildings mixed with the decay of old housing.
The $300,000 house cited is in downtown’s decay of old housing.
I find your post to be very black and white….no pun intended. How can you say “North Long Beach is nothing but gangs…” That is not true. There are many good, creative people investing in North Long Beach…one of them is a graphic artist I know from dog park. If you drive thru some of those neighborhoods, you would see that many are fine and desirable.
“West Long Beach is industrial and beyond redemption”??? Wow, what negativity. That is JUST NOT TRUE. They’ve redeemed it quite well, thank you. I’ve seen what they have done with those old buildings…beautiful lofts within old interesting looking buildings…keeping character yet making it modern and very livable within. I suppose you think all of the old buildings should just be domolished for newer boring buildings with no character? No way.
East Long Beach is safer…that is where my mom lives….but I would not say it’s the most interesting. The buildings in the older part of LB are much more attractive and, I believe, deserve to be saved. Have you no appreciation for historical architecture and the past? I do….and thank God others appreciate it, too. And who are you to say it’s “decaying”. I live in a 1912 home…my home is NOT decaying.
Thank God for creative types who have appreciation and the creativity to go into unappreciated homes and neighborhoods and make them nice again. Sourpuss.
“West Long Beach is industrial and beyond redemption”??? Wow, what negativity. That is JUST NOT TRUE. They’ve redeemed it quite well, thank you. I’ve seen what they have done with those old buildings…beautiful lofts within old interesting looking buildings…keeping character yet making it modern and very livable within. I suppose you think all of the old buildings should just be domolished for newer boring buildings with no…”
I have to comment upon your perception of the westside LB. There are no Lofts on the westside period. There are no old historical bldgs at all being torn down on the westside( but they did tear down Angels exotic nightclub, a sad loss). The south end of the westside, basically that part south of pacific coast hwy, has a lot of trucking repair shops to service all those big diesels which lurch their way along PCH and the nearby LB fwy.
What used to be the old navy housing acreage off Santa Fe ave and PCH t is now a middle school and workforce employment center. There are some industrial operations such as tell steel and a brand new CSULB warehousing/tech park. AS you go further south all way to anaheim street the port operations impinge upon that part of the westside. What screems here is port shipping, which is a vital growing factor in Long beach industrial/economic infrastsructure.
I don’t know what you mean by “West LB”. I don’t see how you are not including downtown…it’s like you’ve totally skipped that whole area where there has been massive reviatlization happening. Is not downtown part of “West LB”? I was there today. I went to the beautiful and very BUSY FM Bank. Lots of professional people out enjoying the sun and lunch. People with dogs were out. I saw the doma building with the beautiful penthouse top with palms. Wow, what a gorgeous building. I saw another loft developement…very nice. I’ve lived here a long time but each time I go downtown I see something new. I met a man who had a poodle like mine. He lived there and said “lots of dog walkers here”. He was very friendly and good to his dogs.
Is there an industrial area? Yes, over the freeway I suppose…but why are you focusing on that? It never ruined my day. The industry has been there my whole life. There is so much downtown, that you just forgot to mention or perhaps you just don’t expand your horizons to go down there and see something new. Even my 81 year old mother who worked downtown enjoyed it. We went to various restaurants for lunch…we would go to the brick church on Cedar (yes THAT Cedar) and listen to the “afternoon organ concerts”. I would enjoy going to the library and used books stores. Life does not center on East Long Beach…really!
Whatever…some of you are waaaaay too negative.
“North Long Beach is nothing but black gangs”
I don’t understand this fixation with colours… Why not just say “nothing but gangs?”
You may not realize it, but there are racist undercurrents in your post.
Well, black does describe the nature of the gangs. I think that is just a fact…black gangs are a bit different than Latino gangs or skinheads. I don’t think that’s necessarily racist..just descriptive of what one would see. Just my two cents.
“Berry said he’s beginning to receive more phone calls from people looking to buy and sell foreclosures and fixer-uppers.”
This is where we will get our DCB (dead cat bounce). Suckers…
For those of us worried about the still-rising median prices, can you give us the street name so we can look up and see these drops first-hand please? thx
seems the new message is, if you are just dabbling in selling your home, take it off the market because inventory is crushing us.
There have always been dabblers out there. However in the past, these dabblers turned a quick profit. Now they are strting to see things change for the worst. Now the dabblers are loweing their asking prices and still getting no responses. Now the dabblers are not dabbling at all…they are starting to get worried. You’ll see dabblers begin to turn into desperate sellers when they realize that the water level is now above their nose…hence underwater (loan vs. value).
Yes, I think the whole “dabbler” thing was a straw man argument to begin with. Last years dabbler will be this years (or 2007’s) seller in conundrum or full on FB.
Does anyone else find it humorous the Bob Casagrand name loosely translated into Spanish is “BIG HOUSE”?
People should take their homes off the market, and re-list them next year when the comps are lower.