‘It’s Not Last Years Market Anymore’ In LA
The LA Times has this update from California. “Without question, the market has changed. Bidding wars are fewer and farther between. Word-of-mouth sales before a sign goes up are less frequent. And deals struck in the first minutes of open houses are all but history, agents say.”
“For four long months, there has been a ‘For Sale’ sign in front of David and Jody Saltzman’s Malibu home. ‘I was hoping it would sell in 60 days,’ David Saltzman said. When it didn’t, the couple lowered the price by $100,000 in April. They took another $100,000 off in May. With the house eventually listed at $1,495,000, making it the least-expensive listing in the development for a house of its size, they finally entered escrow a week ago.”
“The Saltzmans aren’t alone in their prolonged struggle to sell. Houses throughout Southern California are staying on the market longer than they were a year ago.”
“(Realtor) Tuba Ghannadi in Palos Verdes listed a 3,000-square-foot house in during the Christmas holidays for $1,948,000. But the house isn’t moving. ‘In February we lowered the price for the first time. Every month we’ve lowered the price some more,’ she said. The asking price is now $1,748,000. Still, the house sits vacant.”
“Such price reductions aren’t limited to the $1-million-plus market. In San Jacinto in Riverside County, real estate agent Hugo Florez has seen the price of one of his listings drop every month too. The three-bedroom, two-bathroom house came on the market in April at $275,000. ‘We dropped it to $265,000 in May, and $259,000 in June,’ said Florez. ‘It’s not last year’s market anymore.’”
“After 111 days on the market, Bruce Kurnik’s clients cut the asking price from $1,489,000 to $1,399,000 for their five-bedroom, 4 1/2 -bathroom house in 3,699 square feet in Oak Park, an unincorporated community of Ventura County. ‘We had two offers when it first hit the market, and the sellers didn’t take it,’ said the broker.”
“Kurnik has a Van Nuys home that’s been listed for 125 days and counting. ‘The seller wants a certain price,’ said Kurnik, who listed the three-bedroom, two-bath house for $589,900. ‘We had a very interested buyer, and we were extremely close to putting it into escrow,’ Kurnik said. ‘But the seller said, ‘We’re coming into summer, let’s hold out.’”
“Houses and condos can linger on the market for many reasons, and sellers, through no fault of their own, can be caught in a market shift. David Saltzman still doesn’t know why their home sat for more than four months, but he’s philosophical. ‘We don’t feel insulted, because there are several houses that have been on the market quite a bit longer than ours.’”
We are in the slope of hope period!
Once prices return to 1999 levels, I’ll be interested….
Heck! I’ll be interested at 2002 levels! That’d be a half price sale, anyways!
You know what, over the past five years, among suburban real estate “barons”, I’ve watched confidence and arrogance swell along with equity. Did these folks have any idea that Greenspan was crazily holding rates at 1%? No. Did these folks have any idea that the Chinese Central Bank was buying treasuries to the tune of $250 Billion a year? No.
All they knew was their precious home was going up 20% every year.
Well, now that the cycle is turning, I’m not going to jump in until people cry uncle.
I want to see the smugness of sellers turn into concern, worry, fear, and then genuine s***-your-pants fear and finally an overwhelming depression before I buy a home.
Mr. Beach, I agree! The tide has turned so much that the housing market and therefore the economy in general could be looking pretty sorry by the time the mid-term elections come around.
I don’t know what the results will be I just know that people are alot more pissed when financial misfortune affects them personally. I don’t think the mood of the nation will be all smiley faces in just a few short months no matter who spins what.
Huggybear’s point is why the respected bearish economists are soft-pedaling the consequences of this RE bust, IMO.
People get pretty pissed and crazy once it starts hitting them and they can’t go for the bi-annual cash out refi and lower their payments to boot.
Invest in security for public bears
Huggybear –
Gotta say I love that handle!
Thanks, I ripped it off from Starsky and Hutch from the ’70s (of course).
http://www.spookyempire.com/pop_culture_convention/antonio_fargas.html
Is this telling me that there are fewer big idiots in SCal that are willing and then able to pay prices like $1.5M or $1.9M for some piece of wood and nails? I am sure there are still a number of fools, they have just had the ability to get that kind of money greatly reduced. How sad, some of these folks won’t be able to walk away with a $1M of profit just for living in a house.
I’ll bet that article sent LA Investor Girl running into the street with her heloc checkbooks
Yes — she is either champing at the bit to catch herself a falling knife, or else to find some fool who is willing to take some of her investments off her hands at a “discount” price…
LMAO!! We haven’t heard from her in a while. In fact, since the media has been starting to focus more on the bubble in the last couple of months, I can’t recall seeing any posts from her.
Or several other trolls we could identify!
LV Landlord has gone AWOL in a big way. Not a peep from her. She’s either sleeping on a park bench with no Internet access, or back living in her parents’ basement and too befuddled from anti-depressants to log on anymore.
Don’t forget most $2 million SoCal shacks could EASILY have been 300K-500K in 2001. This is no joke. There are plenty of examples in the records.
300-500k to $2 mil? Oh my…
That’s a tad overstating the issue. Those are usually “Santa Monica Teardowns” not the same house at resale at all. $200k in 1996 to $800k in 2006 is very very common but even here the air gets mighty thin above $1.5m.
Yeah, I just walked past one of these last weekend. What was once a $1.2 million scraper is now a huge McMansion on the market for $3.8 million. It’s on 14th just north of Montana Ave. They copied the architecture from one of the nice older houses up on Georgina Street, and plopped it on a lot that’s about 1/3 of the size. They even did some faux ageing on the exterior. I almost fell over when I saw the price. They were running an open house, and there were actually people milling around looking at it - although they may have been pointing and laughing. It’s going to be interesting to see if they can sell it at all, and if so, for how much. We don’t have an unlimited supply of A-list actors with more money than brains around here, after all :-]
Robert Cote is right. My house was 325K in 97….sold for 1.2 in 2005.
I just love seeing actual price drops in LA!!!! YAY!
In NYC, the quiet perfect storm has consisted of 40 years of no new construction in the outer boros, huge crime reduction under Giuliani and Bloomberg and the resultant population increase after years of declines. I bought my 2 bedroom co-op for 78K in 2001 and just sold (PHEW!) for 350K. The whole outer-boro market has gone like this, until now when a zillion little condos have sprung up where they bulldozed a SFH on a 40 x 100 lot and put up a 3 story, 8 unit condos. It looks like they were selling at 200-400K but the whole last slew of them are starting at 425K for 800 sq. ft. and it looks to me like the limit has been reached. I go to open houses and people are looking, but walking away and the units do not dissappear from the listings anymore. I think the standoff is finally here (NYC always seems to get it last because market & wages are so strong.)
Yea there’s quite a bit of that. I know of one 2001 700k piece that is now listed at 2.4 mil.
Right here directly on the coast, houses pretty much doubled every year since 2002. “They aren’t making any more coasts”. My wife noticed a just “lowered” 750K place (down from 800K), she looked it up, it sold in 2002 for $180K.
You are correct that they aren’t making anymore land near the coast, but I just took about 12 pics of empty lots in coastal HB 92648.
Ben, look for em in your photo submission e-mail box.
To be fair, I’m sure the place now has stainless steel appliances and granite counter tops.
“They aren’t making any more coast”…”They aren’t making anymore land” This seems like the untouchable statements for a type of re. Here is how you break it. They are making hi-rises with 150 units that take up as much land space as three homes….They are completely empty due to being owned by flippers. What is next…They aren’t making any more sky?
They aren’t making any more granite counter tops. (Are they?)
I read somewhere that the most common rock type on the continental land masses is granite.
Soon to be available, “faux-granite” countertops for everyone!
I wonder how many granite countertops you can carve from Yosemite’s half-dome( the most imposing single piece of granite in California). Seriously folks, using granite for kitchen counters is a perfect waste of a magnificent rock for frivolous eye-candy home remodels.
No doubt about it Suzanne, countless homes in many of these grossly overinflated markets have seen appreciations of an easy 400% since 2001. I know up here in the Pacific Northwest, some waterfront home prices doubled in a years time.
In reference to:
“For four long months, there has been a ‘For Sale’ sign in front of David and Jody Saltzman’s Malibu home. ‘I was hoping it would sell in 60 days,’ David Saltzman said. When it didn’t, the couple lowered the price by $100,000 in April. They took another $100,000 off in May. With the house eventually listed at $1,495,000, making it the least-expensive listing in the development for a house of its size, they finally entered escrow a week ago.”
What I find humerous about this statement is that it is the least expensive “listing” in the neighborhood. Who the F**K cares about listing price?? I don’t care if homes were listed for 10 mil, all that matters are the most recent sales prices of all those homes in that neighborhood. Comps are not pulled off of list prices so this statement is a bunch of whining and crying about nothing. These greedy f**ks made hundreds of thousands of dollars on this sale no doubt whatsoever. They are just pissed cause they couldn’t get another 10-20 percent over last springs prices. I wonder if they will be lamenting about reducing their sales price when other homes in the neighborhood sell for 200k less than they make out with. Of course they will! They will always be green with envy over the fact that somebody was able to gouge a little more than them. Rich puking sickos.
I agree.
It has become ever clearer to me that there was a “perfect storm” back around 2001-2 that continued up through aroun August 2005.
And realtors and “investors” got caught in a feeding frenzy for a couple years, making “easy money” flipping real estates as interest rates were “record low”, creditors substatially loosened their credit approval standards, and the real estate profit income tax write began to become more common knowledge and people were beginning to take advantage of it.
The unfortunate thing is that there were many “non flippers” who were just looking for a place to buy where they could live, whom were competing in the emotionally charged auction atmosphere of real estate sales. And now, there are sobered up realtors holding the bag of properties they were not able to flip in time. And many people, and most unfortunately the first time buyers, whom are holding onto real estate that they may not be able to sell for 10-15 plus years before they can even break even. And that does not include re-imbursement for their monthly mortgage payments that they will have to pay for all those years.
Perfectly stated - although I don’t feel bad for the realtors who are holding the bag, just the regular families looking for a placetolive who got swept in.
Don’t kid yourself and start feeling sorry for the FBs. No one had a gun put to their head forcing them to buy and take out suicide loans. They saw the easy $$$$$ and were dumb enough to believe it would go on forever. Just like the last suckers in 2001 that rode the NASD down hard. Tough. Life goes on…
I agree.
What the unfortunate thing is for those in the market for a home “to live in”, are now put in a situation where they can not move forward, knowing about the bubble conditions, and are forced, if they don’t buy, to continue being a renter, involuntairily.
And I would argue that renting v. buying, mean, often, that the renter does not have the flexibility to remodel or fashion thier home as they could had they owed it. And, any labor and expenses, if they are able to remodel, will likely be the property of the owner of the property.
And in many cases, putting aside commiting to a 1 or 2 year lease, the owners often have alot of latitude to evict, with a 30 day notice, in many cases.
The author of “Home Poor”, which I had the opportunity to read a few pages of discusses the pros and cons of renting and owning, and brings up some very good points on the subject.
It would be great to get some feedback on what others thought of that book, “Home Poor” (Published Feb 2006)
I don’t feel overly sorry for these homeowners who are first time buyers. They should have waited. Paying rent is not the worst thing to do on this planet. I wouldn’t want to get in too deep on some of these properties. I think that if you’re going to belly up to the bar and drink with the boys, you’ve got to be aware that just being there with them doesn’t guarantee your personal safety. The same goes for these million dollar babies. If they want to play the game, they need to understand that, yes, crap can happen, and it can happen to them. Desperation to own a house does not mean you should sacrifice common sense to own it at any cost.
Palos verdes is an exclusive area long known for its large ranch estates with horse corrals. Not in the same class as malibu and dosen’t get the stars so that house way overpriced.
San Jacinto is a ragged community way out there , a classic Riverside Boonie town out in the sticks. That price is competing with an awlful lot of homes in the outer boonies of riverside. SaN Jacinto is such a far commute(2.5-3 hrs to OC, 3 hrs + to LA That any one with brains could get an equal home at equal price say in Lake elsinore or riverside city environs, 1 hr closer to OC/LA.
Van nuys is changing demographically with large influxes of immigrants. It is not a particularly attractive city, being basically flat and steamy hot and unpleasant during summers with lots of sweatshop factories and a few big ones (Anheiser busch off roscoe). Nasty traffic town (which is common all over Scal). Bad move not selling earlier-now he is screwed as no one will touch it at that price at this point in the RE cycle.
“When it didn’t, the couple lowered the price by $100,000 in April. They took another $100,000 off in May. With the house eventually listed at $1,495,000, making it the least-expensive listing in the development for a house of its size, they finally entered escrow a week ago.”
That about sums up why this is definitely not a buyers market. “The couple” needed to take $200K off their list price in order to sell. Doing this “screwed up the comps”, inflicting severe collateral damage on the market values of all the homes in the neighborhood to the tune of $200K or so. Why not wait a few years until this correction bottoms out, rather than becoming the next sacrificial lamb to watch your newly-purchased home lose 40% of its value as prices revert to their long-term trend?
“300-500k to $2 mil? Oh my…”
OK - I guess I meant “lose 80% of its value”…
I’d venture to say that similar properties will never go back down to 500K in nominal terms. I just can’t see it. One million I can imagine.
You and a lot of others will be surprised, shocked, even appalled, at the time-tested tendency of real estate prices to revert to their long-term trends.
Or even, depending on the psychology during the decline, to overshoot.
Please clarify what you believe the “long-term trends” are and why you think people will be surprised, shocked and appauled?
” Doing this “screwed up the comps”, inflicting severe collateral damage on the market values of all the homes in the neighborhood to the tune of $200K or so”
Much worse than that. It establishes a trend DOWN so the next appraisal will need to be lower. The trend is your friend if you’re patient and have hard cash, because before you know it, credit will tighten big time once the defaults start hitting hard.
“Houses and condos can linger on the market for many reasons, and sellers, through no fault of their own, can be caught in a market shift.”
It is nobody’s fault if they were born stupid.
These last five years have been such bs. You basically had 3 choices, make the worst financial decision of your life, ie buy realestate in a bubble market. Move to the exciting, stimulating south, where if prices didn’t go up in this market..they will never go up, or sit and wait for prices to come back to reality….but you still get screwed, when houses lose 50% of their value, there will be a 90% chance of a depression. selling point in 10 years. This 4 bedroom on the beach 95k and within walking distance of the biggest soup kitchen in town!
“These last five years have been such bs. You basically had 3 choices…”
I made the fourth choice. I downsized my possessions, rented 2 storage units, and became a computer software consultant willing to move to another city coast to coast within a week notice. The big advantage to that is I have not been stuck in down markets. When Phoenix’s Motorola started laying off people, I finished my contract and 3 weeks later was in New Jersey working on another contract with great hourly pay rates. Meanwhile an older engineer decided to switch from contracting to being an employee of that company and took a pay cut. Why? He had a house in Fountain Hills and an ailing wife (I was sorry about his wife, but whether or not she was ill, he was still unwilling to move to another city for another high paying contract). I basically packed my pickup truck with my laptop, a suitcase, and a duffel bag and ended up in New Jersey and moved into a furnished apartment with a month to month lease. I have a buddy doing the same thing now in New Jersey. His wife and son are in Phoenix. It’s not a great lifestyle for married people. But it’s the “fourth choice.” When we get to the double digit unemployment that we are sure to have in 2 or 3 years and Phoenix goes into a deep recession, I figure I will be back again on the east coast for a year doing some consulting, followed by a year in Los Angeles.
Bill–
Hats off for figuring out a clever way to deal with the collective insanity popularly known as the housing bubble.
GS
Thanks GetStucco! My career has gone from boring to exciting since becoming a consultant in the year 2000. My move out of Phoenix to NJ was in 2002. In 2003 it was from NJ to Los Angeles in the South Bay area for 3 years. Now back to Phoenix since the end of March.
Here’s the house that had 2 offers and rejected them, I got it posted on my blog and will follow it to see what happens.
You have got to be kidding!!!! What an ugly cheap piece of crap that is. I mean they got hosed on their purchase price of 7 and some change years ago. The fact that anyone even made an offer on it is shocking. That builder threw that one up for maybe 150 tops. Ewwwwww again.
xx9 S San Marcos Pl Aug 02 $94,900 2/1.5 1130sqft, year built 1955
In San Jacinto in Riverside County, real estate agent Hugo Florez has seen the price of one of his listings drop every month too. The three-bedroom, two-bathroom house came on the market in April at $275,000. “We dropped it to $265,000 in May, and $259,000 in June,” said Florez, of Real Team Real Estate Center. “It’s not last year’s market anymore.”
It is a half century old POS in freaking San Jacinto (middle of nowhere), are you really surprised there’s no buyers at $275,000???
you have to figure in the $3 gas and an hour driving each way to any job, lousy school system and gang infestation, Inland Empire worst smog in SoCal, no local amenities like good restaurants. At least it’s close to Palm Springs and Mt San Jacinto.
Went thru San Jacinto about three times. It is at far northeast section of hemet. It is way out there in the sticks, and rather shabby at that. Lots of low life reside there. Commute time from there would be 3 hrs+ to OC, longer for LA. The indian gambling reservation is close by and thats it. Nothing at all to do in This rather small rustic community. No one except a fool would touch this at 259,000. Prices for all boonie houses in the riverside hinterland going down real fast.
Hi. Just wanted to say I’m still here, just laying low.
People used to tell me I was out of my mind for suggesting 50% price cuts.
It might end up going to 80%.
Guess I was being conservative.
The speed and density of this Real Estate market rolling downhill appears to be staggering.
Nice to see you, keep posting and I owe you a beer or two in HB.
Keep an eye out on the HB photo page here, I just sent in a number of great ones for downtown HB.
Hey Sunset.
I think I might start posting more here, and post less over at Jon’s blog.
The ceaseless overuse of editing over there appears to be out of control. But hey, it’s a business, so go figure.
I am boycotting OCR’s blog.
Too many assymetrical edits and perma-bulls allowed to flame.
Specifically Lansner posts the looniest bears (Allen N) and edits out the articulate bears.
Check out the topic about this in the bits bucket.
Here is an e-mail address for me for future reference for the beer when this bust is irrefutable.
CBKSK at hotmail.com
I am up for a beer with the both of you anytime if you are interested.
I drive from Mission Viejo to Torrance daily, so I see the Seal Beach exit and Beach Blvd exit daily.
OK e-mail offline.
How about Bubble Analyst?
I’m actually staying away from Patricks Blog. One threadmaster is edit-happy for no reason just because they don’t agree. Screw that!!!
Well today I went to Yahoo Realty and picked a few areas I might consider all around the western U.S. And limited my price to $400,000 max on my search. Copied a few pages of each into a Word document and named it with today’s date appended. I figure the top prices in each area should be at most $200,000 before I would consider them. That would be a 50% haircut. I think 80% would be an overestimate, unless you are thinking of Merced, Fresno, Sacramento, and so on.
Bring on the Depression. Why did our financial systems allow this bubble to get as big as it did? Why was this allowed?
Well, now you are wandering into the “tin foil hat” arena where I happily post links that inform and appall. Enjoy!
http://onlinejournal.com/artman/publish/article_775.shtml
The people running the financial system are not going to feel any pain. So what do they care?
What I think the story is here, is the inflection point of the media coverage. Annette Haddad point blank said “This housing bubble” in an article about San Diego recently and now Gayle wrote this somewhat accurate article about LA real estate. A couple of months ago they were emphasizing quotes from permabull RE agents, CAR and NAR representatives, although they still quote the NAR talking point things are normalizing and in the words of Tony the Tiger “That’s Great”. I believe the new tone reflects how fast market conditions in LA are changing. For the past 12 mos we have been watching cities like San Diego and Phoenix slow down reflected in their escalading record inventories. LA is just now entering that phase except in a much worse interest rate environment. So they are getting a double whammy. The slowdown here could be much more pronounced as a result. I live in Redondo and I am seeing an awful lot of Open Houses and For Sale signs that have been so absent in the past couple of years. Hold on to your hats this could be a pretty big ride.
word check, I meant “escalating”
Actually, I think “escalading” is apropos too. As in, Cadillac Escalade-sized inventories.
I agree. I’ve noticed the media catching on to this more in the past two months. When their RE advertising revenues begin to soften (or be replaced with something else), then you’ll the MSM go after this like a rabid pit bull due to the human misery element. For me personally, it was major milestone to the see the San Diego Union Tribune actually use a headline (Spring Slide) that was not ridiculously optimistic or disconnected from what was really happening in the SD housing market. As the MSM begins broadcasting more stories, old Joe 6pack will begin to slowly realize what’s going on and then…panic.
I’m with you all the way. It just took a little longer to happen in the South Bay. Reductions according to ZIP Realy are running around 26%, but they are climbing. Also, I’ve been tracking SFR homes between $650k and $1.5M, and in this range inventory has nearly doubled in the last 6 months.
The uglyness for most home sellers will be after the summer season, that’s when we will see dramatic housing reductions.
“…pretty big ride”???
Will it be pretty?
Will it be “big” as in take a long time to finish or “big” as in with extreme ups and downs? or??
Thanks (smile)
The people jumping in and buying now just because a house that is 150% overvalued has been reduced in price by 10% or 20% are going to get hammered in the next few years. Most all buyers are still stretching to the max and using trickster loans with teaser rates.
The average person has no real concept of economics. Buying right when an asset bubble is just beginning to burst is really dumb. In fact, it’s probably dumber than buying at the peak of the market - at least then the crowd is with you.
House for sale! (sold 3 years ago for $300,000) Newly reduced to $1,200,000 from $1,300,000. Oh my god! What an amazing bargain! It must be a “buyer’s market”.
“a house that is 150% overvalued has been reduced in price by 10% or 20% are going to get hammered in the next few years.”
20% might not even be enough to correct for the effect of appraisal fraud…
Where is Gary “in the bag” Watts? What is his comment for this posting? Afraid to show his fat ass?
Can’t wait to see the paper in LA when they finally have to print that SFR are up 3% y/y for May.
Affordability here keeps dropping. LA is now down to 1.9% on the Wells Fargo Housing Opportunity Index, meaning 1.9% of the homes that sold would be affordable to the median income household. Another new all time record for any city EVER!!!
Tons of new inventory piling on, sales slowing even further. By fall we should see y/y flat to declining median prices. Should be up to at least 8-9 months inventory (probably more), as sales slow and inventory rises. Right now we are already at over 5 months worth.
The realtor organizations loved the “month’s inventory” figure on the way up, it is going to kill them on the way down.
Things are changing quickly in LA.
deb wrote:
Affordability here keeps dropping. LA is now down to 1.9% on the Wells Fargo Housing Opportunity Index, meaning 1.9% of the homes that sold would be affordable to the median income household.”
deb, is that the same as saying that only 1.9% of the people living in Los Angeles can afford the average priced home in Los Angeles?
Please post a link or email it to me directly. Thanks!
My email address is in my profile
Here’s the Q1 report for the Wells Fargo Housing Opportunity Index
It is basically turns the affordability issue the other way ’round from the way the realtors like to quote it. This index tells you what percentage of the homes that sold in a given city would have been affordable to a median income household (not person, but household).
LA hit a new low for Q1 2006. Lower than any city ever on the index. This with rates still well below 7%.
Just to give you an idea how far LA has fallen, while it has always been an expensive city, our ranking on this index was about 50% as recently as ‘99. Amazing!
Wow! Astonishing chart - NYC is at 7.8% - Tampa at 43.8 - so this is a decent move for my family - as it is the only other place I have family and is affordable. Of course, I will still sit on the sidelines with my cash and wait until it gets back to 2002 at least, because even Tampa got hit with bubbly, albeit on a much lower level, and later in the game.
Deb,
Thanks for posting this.
What is the definition of affordable in this spreadsheet?
Those are some truly stunning numbers for LA. Too bad they lump LA into one enormous bag - it makes it hard to compare to other cities.
deb, thanks for the clarification and the link.
If that report bases affordability on “median income”, it could be even worse than they think, because, from what I understand a median income takes the incomes of everyone, from thoses that make hundreds of millions of dollars down to the lowest. And those that make the 100’s of millions of income a year, could sque the medium up quite a bit.
To illustrate a relative point, it is often reported that the top 1% income earners earn something like 90% of all the income. And the 99% and lower income earners only ear about 10% of the overall income each year. I am not sure on the specific percentages, but the idea is that the income, people making the most income, is making up a higher percentage of the overall income of all the peopl.
You guys have any thoughts on that?
No offense, but I have to correct you on this because it’s important. Median (not medium) is not what you’re describing. You’re describing what happens with the mean (averages).
Median income would be the middle value of all incomes across a broad range of individual or household incomes sorted in ascending order. The resulting median income would reflect the income range that most households are at. This is very different from average income per househould which would susceptible to being skewed as you describe.
who were you correcting?
If you were referring to me, I was speaking median price and median income.
And from what I understand, a “median” is calculated by adding up all and deviding by the number persons or properties that were totalled up.
From what I understand of a “median” price is, that you can sort of call it a medium, but that is not how it is referred to.
How would you define and what would you define the formulas to calculate a “median” and a “medium”?
I found this calculation of a median
In the description they basically say if you have a set of numbers. Say we have 11 numbers. It appears they could still be squed. for example:
.25, .34, .65, .9, 1, 5, 85, 90, 160, 250, 400
The “median” would be 5
The Medium would be: 90
In my example, there is a difference of several hundred percent.
Any thoughts on how this plays out in the real world?
Ooops. The 3% y/y increase was actually for the San Fernando Valley, not all of LA. I get the realtor stats when they are released to the members, not to the press, which won’t be for another week or two. The Valley gives a pretty good indication of what’s probably going on in all of LA.
NEW TEASER RATE:
Heard on an I Pay One radio commercial today in San Diego:
“No mortgage payments for first year” when you buy through I Pay One.
Brad, thanks for info.
I suppose that offer would be considered an incentive?
That is another example of how real estate prices are being kept to look higher than they in reality.
I have been seeing several sellers offering to pay the mortgage for several months, to try and entice buyers to buy their house, instead of just lowering the price.
Yes, considering the monthly payments involved, that could add up to a effective 10% price reduction quite easily on the median price house in SoCal.
did they mention the fact that year two, it is I Pay One Through the NOSE
“pay through the nose” is an interesting expression.
I kind of wonder where it originated from.
pay through the nose
http://www.answers.com/topic/pay-through-the-nose
Thanks!
Ouch, on the “nose slit” tax delinquency.
“David Saltzman still doesn’t know why their home sat for more than four months, but he’s philosophical. ‘We don’t feel insulted, because there are several houses that have been on the market quite a bit longer than ours.”
Doesn’t know why? Because it’s too expensive, you freaking idiot!
But he “doesn’t feel insulted” - how big of him. People like this deserve to get their financial legs cut off at the knees. He’s lucky the place sold at all; I just hope he upgraded on his new house so that his profit from this sale disappears in lost equity on the new one.
Don’t get too excited just yet. LA had some of the biggest gains, therefore it is logical to expect some of the biggest corrections. I hope Ben is prepared to keep this blog up and running for the next several years.
In the San Fernando Valley…just about every neighborhood is a million $ neighborhood! I can’t wai for this thing to fall. If it’s not a half price sale…then I’m not buying!
The Saltzman’s should consider themselves lucky if they get $1.5 million for their tract house in Malibu with no view. I seem to remember those places selling for about $500K in 1995.
no kidding, “we don’t feel insulted???”
There are a lot, i mean a lot of for sale signs all over the LA/oc. 4 signs along a 1 block stretch on Xemino in Long beach. Clusters of signs on corners of condo complexes. Rich areas, poor areas, everywhere.
A home on 1090 vina street in Long Beach is listed at $427,900. No Garage. 3 bedroom-1 bath on corner lot. Owner did complete upgrades and it looks clean and well kept.
Problem is that this house is in one of the worst areas in Long Beach near anaheim and cherry ave. The area infested with Gangs and graffiti. The lot is less than 3000 sq ft and there is no garage, just a small shed at end of a cramped driveway.
I’ve been tracking Woodland Hills in the San Fernando Valley. In January of 2006 there were 255 places for sale. As of today (five months later) there are 455 houses for sale (includes condos). The only properties selling are those that were priced very low to start with (total fixer uppers) and those that have been reduced multiple times. Everything is just sitting. Properties are also sitting for 120 plus days and magically having their listing refreshed and being marketed as “New on the Market”. They’re still sitting.