Orange County Home Prices ‘Down Sharply’
The Orange County Register has this report on home sales. “Orange County home prices took a tumble in January, with the median price falling below $600,000 for the first time in eight months. DataQuick reported today that the median sale price for all residences sold in January was $582,000, down 6 percent from December’s record $621,000 but still up 9 percent from January 2005.”
“Sales volume was weak, too, as 2,594 homes sold; down 11 percent in a year. This was the slowest January since 1997.”
“January is a traditionally weak month, with fewer big families buying bigger, pricier homes. This January’s seasonal slump was amplified by a rush of sales of new, lower-priced homes.”
“Last month, developers sold 426 new homes, slightly more than double the sales of January 2005 and the highest January count since 1989.”
“New homes sold last month include conversions of old apartments to condos and two high-rise condos in Irvine. This relatively cheaper housing helped push the median new-home price for January down 36 percent in a year to $472,000. That’s the lowest new-home median price since June 2002.”
“January is a traditionally weak month, with fewer big families buying bigger, pricier homes. This January’s seasonal slump was amplified by a rush of sales of new, lower-priced homes.”
Sure, we should expect fewer sales in January. The 6% drop in price however is anything but typical.
That means OC prices have to go up by 29% the rest of the year to get back on track to their normal 23% YOY gains. No problemo!
So there was a “rush” of sales of lower priced homes, but this was the weakest January in terms of volume since 1997? I don’t think the lower prices can be explained by a rush that didn’t result in a decent volume of transactions.
With such low sales volume they could equally have said ’stall in the higher end’, but ‘rush in the lower end’ sounds better eh?
“January is a traditionally weak month”
Uh Huhhhh.
REALTORS TAKE NOTE: we’ve been tanking since this summer, but you always have such positive SPIN on it
“school is starting”
“Thanksgiving Holiday”
“Christmas Holiday”
“New Years Holiday”
“SuperBowl”
“Waiting for Spring”
now “January is traditionally a weak month”
OK, OK… you’ve burned through a half a year. What’s next,
“GROUNDHOG BOB didn’t see his shadow”???
well, President’s day weekend is coming and then st. patricks day and then…
Classic stuff.
“The Orange County Register has this report on home sales. “Orange County home prices took a tumble in January…”
Post-bubble media buzz word = “tumble”
so when will we see YOY price declines?
YOY declines in march or april.
I would guess it wouldn’t be until the end of the year. San Diego has been stumbling along for over a year now and y-o-y is still up, slightly.
I hope we do see some YOY declines, because Feb was a low month last year and then things skyrocketed in March, April, May and June.
All we need now is a gain of 21% because Gary Watts promised that prices will go up by 15% this year. He actually said it was IMPOSSIBLE for prices to decline in the OC YOY
typical crappy reporting. this article could have just as easily read “housing prices up 9%” or “sales of new home double”
hard to track what is really going on except that prices are leveling/trending down
Look on the OC thread from last weekend (Saturday?) for an interpretation (lower new home prices and relatively higher new home volumes suggest that builders are undercutting used-home sellers, as we predicted would happen).
wouldn’t it make sense that the price of new homes is higher than the price of existing homes?
Homebuilders still have a few pending sales that they don’t want to risk losing. Once they close on these, the price hatcheting will begin and all this incentive crap will be over.
Just a note on those supposedly “lower priced” high rise condo’s in Irvine. They are down the road from me on Jamboree and they are anything but “lower priced.” Most, if not all of the condo’s sold above 550K with the average being about 800-900K from what I was seeing. Also, all those so called “conversions” did sell for under 500K with many near the 550-600K mark, certainly not enough to cause the ENTIRE median for OC to drop.
Does anybody have Gary Watts phone number? Hope he saw the 6% decline. His prediction of 15% gains that were “in the bag” is off to an ominous start.
NICE CALL Notorious D.A.P.!!!!!!!!!!!!
His website is here: http://www.impactre.com/
As for Gary Watts comments of 15% rise in RE prices: If the majority were right the majority would be RICH! However that is never the case or we would all be able to retire tomorrow. Someone has to bear the cost of pushing these values higher and higher and that would be the debt holder of the new mortgages. If I were Gary Watts I would enrole in a refresher Econ 101 class as it is not tought in the RE circle.
That’s right- for every real estate windfall we’ve heard about there’s a new-home-owner with a mountain of debt.
It doesn’t matter whether or not January really is a slow month. If there were just a decline from December to January, then you could make an argument it’s a seasonal anomaly. But when you compare a month’s results to the SAME MONTH a year ago, you eliminate any impact from seasonality. Ergo, these results truly are a disaster, not just the result of some seasonality crap.
I’ve noticed they blame some drops on lower-prices condos and homes on the market. isn’t that just a sign of the bubble though? the regular priced(maybe median is a better word) become out of reach so there is a disconnect between median and lower-priced. eventually regular folks are priced out of median housing and so there is a structural shift, caused by the housing bubble, to the lower-end?
Hate to get off topic (clearly Gary Watts is a greedy, self-serving moron) but do you guys know anything about Ventura County. I have been looking in Simi Valley/Moorpark area for more than a year now; sadly watching as I got priced out of every market there is, even condos. I think I MIGHT be able to afford a nice trailer home on a corner lot with a view of the VONS sign down the street.
What are your perspectives on the bubble in those areas?
Priced out,
All housing markets in SoCal are subject to the same tidal forces. The ebb tide will lower all ships.
Robert Campbell
Thank Robert,
Any educated guess as to when this tide will demolish my neck of the woods?
(temporarily) Priced Out
Not really an educated guess (other than the education that I’ve gleaned here), but I feel that things won’t start to shake out in CA until it’s clear to the average “Brent and Jennifer California” that:
Prices will not appreciate enough to cover their ballooning payments on their I/O ARM.
The average person’s salary is not growing nearly enough to cover this - it is entirely dependent on house price appreciation.
I’m in Santa Barbara, and waiting too.
East Beach Nice!!!
Born and rasied In Santa Barbara!
Sorry, priced out, the Bay area is not my turf … so I can give you no intelligent reply. As far as I’m concerned, you Bay area guys live in a different world from the SoCal guys.
I would have to “go to instruments” to give you a solid read, but I don’t like what I see for the entire state.
From the data I’m looking at now, it’s either San Diego or Sacramento that will be ground zero for the crash.
Robert Campbell
priced out
I’m newbury park. Good see some oner other than Robert on the board.
Do u check Zip realty. There were some 8 homes reduced for NBPark in the beginning of the year. 4 of them vanished in feb.
This sunday there was an open house in out condo complex(I rent) . Did not have time to visit. did not see many people twice when I drove by the condo
This one is not even listed on zip!
I do check Zip Realty (among others) and I have noticed similar things here. I am seeing these “For Sale” signs popping up like those stupid Lakers flags in everyone’s car windows after the second national title. They are sitting on the market longer and longer, some even have the red “reduced” flag, but it still isn’t enough to make a difference. Simi Valley just seems to be a little behind the curve when it comes to reductions.
Is there a way to check total listings in an area (like LA county)?
the oc is “park place” on the old monopoly board. when it gets thumped you can bet that the end times are here. we’re awaiting the tremors up here in santa monica (”boardwalk”)
SF Peninsula is another one. If it tumbles here, it tumbles everywhere.
I think half of the people who contribute to this blog live in Santa Monica!
Myself included, I should have added.
West Hollywood, thank you.
But half the people I work with live on the Westside. LOTS of new homeowners - nearly all happy-go-lucky 10-year IO folk.
We all make ~ 100k. If people making over 100k go IO for their condo, what does that say?
Now what makes you think that :-)?
Or wish they did again!
I thought we were going to be cutting the deficit… well maybe next year, slap some more on the credit card in the meantime.
Treasury to suspend sales of state, local bonds
E-mail | Print | | Disable live quotes By Robert Schroeder
Last Update: 1:30 PM ET Feb 15, 2006
WASHINGTON (MarketWatch) — The Treasury Department will suspend sales of state and local government-series bonds until further notice beginning at 3 p.m. Thursday, the department said. Treasury is suspending sales while it negotiates an increase in the national debt limit with Congress. Treasury Secretary John Snow has said the debt ceiling must be raised by mid-February. The current limit is $8.184 trillion.
bout time.
When I moved to OC in July of 2000, my 50 year old 1200 sq ft starter home in a Latino neighborhood was worth 192k. Now, it’s worth $575,000. So, on a Monopoly board, Orange County is Indiana Avenue, but recently some asshat specuvestors took blue paint and covered up all the red.
Be careful how you use the word “worth”, since “worth” and “value” of property these days is all relative. That $575K may have already turned into $525K….or less.
BayQT~
i should qualify my “park place” label by saying that oc is such a high visibility weathervane for all of socal.
west LA/santa monica / SF / NY are the ultimate prizes. can i hear an amen?
It seems the general idea is that “everything will be okay in the spring.”
Problem is, there’s no more buyers.
Bernanke’s going to raise rates twice, if not three times more, and even speculators are scared to death of those numbers.
Who’s going to buy when prices are falling?
And what fools are left to buy a home to go bankrupt on?
Didn’t that guy just shoot his wife and kid because his payment was $2,900 per month?
(Maybe it was just the hookers…or ‘voices’…LOL.)
Yeah, nice pickup on the English guy in Boston. I wonder how many more folks are going to get gunned down by people that snap when they find out their financial futures are completly destroyed.
COME ON DO WE HAVE TO TALK ABOUT THAT IN REGARDS TO THIS BLOG, HE KILLED A NINE MONTH BABY DONT FORGET, IF ANYTHING FEEL FOR HER, F-HIM.
What does the age of one of the victims have to do with anything. Yes, this is a disgusting tragedy, and I wasn’t making light of it, only commenting that even the police are speculating that since the guy hasn’t worked since September and his mortgage payment was close to $3 Grand a month, that their may be a financial motivation to this crime. There are a lot more folks on the brink of financial disaster out there, and some may take the same route as this guy when they think they have no future.
Sorry pal just feel for that kid Lillian. I’m a dad, maybe just like you so it hurts to read this stuff. I really hope it dont end this way even if your in finacial trouble there easyer ways then that.
Also If I read the story right they have only been in this this house for 10days before he killed them.
So he was out of work before they bought the house?
People do crazy things for money(murder, robbery, etc).
When people find out that their life savings are wiped out and that they bought a home at the peak of a real estate bubble & are financially ruined for life they will do crazy things(murder, robbery, etc)…. I’m not making light of this but similar things have happened in past busts(ie: people shot their stock brokers after the stoch market crash..–> realestatedecline.com)…It’s just the aftermath of a bubble mania and sadly, we are going to see a lot more stories like the guy in Mass who shot his family. Lots of divorces too.
>>>>>It seems the general idea is that “everything will be okay in the spring.”
>>>>>Problem is, there’s no more buyers.
Excellent point. At a 70% homeownership rate for the U.S., how many more sub-prime borrowers will they give home loans to before the market is tapped out?
Robert Campbell
Is this just normal marketing (raise the price then lower it) or is this a sure sign of the peak ….
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I thought Kiyosaki was a bear at the moment.
Now they’re just lying.
http://www.marketwatch.com/News/Story/Story.aspx?guid=%7B9B15967E%2D0EB3%2D4031%2DA558%2D092CBE27FF43%7D&siteid=mktw&dist=
wtf? how is THAT possible? That’s such bs.
“Overall, prices of existing single-family homes rose 13.6% in the fourth quarter to a median $213,000 compared with fourth-quarter 2004.” (my emphasis)
We’re going to see heavier and heavier emphasis on YOY comparisons (for the next few months, anyway :)).
This must be the new mandatory spin talking points that have been handed out to all the Realtors. That pesky more normal balance reared its ugly head in just a few short months. I imagine that the abnormal unbalance market is just a few shorts months away followed closely by the extreme crash which will last for years.
Hilarious!
http://realtytimes.com/rtmcrcond/California~Orange_County~gingerbohlandaliotta
I like that, “Buy buy buy” and “Almost anything is a good investment.” OK Ginger, if you say so.
I just got of the phone with Ginger, and according to her, or should I say Mr. Watts, prices are just going to go up because they aren’t building anymore. And her phone is ringing off the hook with buyers. That is her quote. I mentioned to her about the stats. PATHETIC
Oh my @#$^&% God!
LOL!! This is one of these people who end up in the soup lines, living on the streets, selling her body for any food she can get, unless she’s got family or friends who can take her in!
This is the abject, irrational exuberance that ALWAYS exists in market tops, right before the formerly bullish market turns bearish (in this case, it already has). All markets have a bullish and a bearish phase. Real estate was in a bull market for a long time, but it’s topping out at some point, especially when you consider interest only loans or other creative financing options resetting this year and next year. It could be even worse in ‘08! Where are these people, who were unable to sell their houses in time, going to come up with the money to pay the much-higher monthly payments after the resets? They’re going to be mailing in their keys by the tons!
Stephanie
Ginger must own a pair of Rose Colored Glasses to go along with her red hair and the total BS she is slinging.
Catherine,
That one’s irritating and the agent sounds like a parrot, only with less intelligence.
This one is infuriating considering Fairfax County’s inventory is up an obviously non-significant 400% since last year.
http://realtytimes.com/rtmcrcond/Virginia~Fairfax_County~monikakumar
“NO MORE LOW BALLING Buyers! You rolled your dices as well; some got lucky in January by getting below market price from exhausted sellers. It’s not working ANYMORE and it won’t work. Sorry!”
And Monika doesn’t even know that “dice” is already plural…
actually, the lady is saying absolutely nothing. very generic catch all statements subject to a wide interpretation.
but you sharp cookies already knew that!
The use of all-caps and exclamation points by these realt-whores is hilarious. I’ve noticed in our local MLS a lot of this kind of stuff lately. They’re either jacked up on Starbucks or panicking over the fact that they’ll have to find another line of work soon.
getting JACKED UP on Starbucks counterbalances the depression that comes with a career that is ENDING NOW.
I didn’t know prices could “drool”.
Sounds like we are Past the Denial and into the Anger phase.
It’s the buyers fault that prices have been dropping -stop lowballing you nasty evil buyers - it won’t work as never drops.
And another agent says the exact opposite.
http://realtytimes.com/rtmcrcond/Virginia~Fairfax_County~lisabaileyharper
“The market has definitely changed and any offer is a good offer nowadays.”
“I feel it should pick up in a few months so Sellers hang in there.”
What she should be saying is “Drop your price by about 15-20% and get the hell out of dodge.”
OK Monika, I promise, I promise I will not lowball any more. I will gladly pay ‘balanced market prices’ from now on. Please don’t spank me….
Arwen, I like it when some agents can admit that the market has changed. Unfortunately you have very little of that in Orange County. Most of the realtors here are just like Ginger, BUY BUY BUY, cant lose, everythings a sure bet, etc.
Gary Watts is quoted like a prophet and revered like celebrity in the RE world. Truth is hard to find.
Hopefully, those who have been prudent in the OC will be rewarded, instead of year after year of humiliations by the scorn of the foolish.
When will it pay to be fiscally wise again!!?!!
Everybody: HELP!
Ever since the changeover to the new format on this blog, at least half of the “comment” boxes are blank on my screen.
Anybody out there know what the problem is and how I might to fix it?
Hate to miss these comments! Thanks.
spd,
Could you please email the details of the problem, including what your operating system and browseer are?
thehousingbubble@gmail.com
Ben, I’ve had the same problem, but only once when going down the San Diego thread from 13th Feb.
XP/Firefox
Problem is still there now BTW. I just tried the thread again (in a seperate tab).
IE will display the whole thread on the same PC, so it does look like a Firefox problem. Bummer :(, I like Firefox.
I use Firefox, and I haven’t noticed any problems.
everytime i visit orange county, i cant believe people actually want to live here….yes it is in a beautiful geographic location,but it is extremly overcrowded,cookie cutter subdivisions and countless mini malls all w/ the same chain stores….the 405 is impacted and rush hours is from 6 a.m to 8.pm,and u got to spend 650 k to get in the ballgame…….be a mtge slave and live in commuter hell,this part of so cal is going to drop hard and fast,as most jobs are in the real estate sector….i cant wait for the party to continue gaining steam……
Additionally the smog in OC and LA is rediculous. LA is the only place in the country where I can see a brown layer of smog hanging over the city and can’t see a mountain from a mile away.
I know at least one blockhead that wants to move to California, not OC, but Santa Rosa. He moved to Michigan from out there about 5 years ago and has always been bragging about how he made 50k on his house Cali house. Once he was here, he decided to take some of that money and buy a second house next to Lake Michigan. His real estate dreams got washed up in the surf when his second house didn’t go up value as expected and the carrying cost forced him sell for almost what he paid. Now, he wants to go back to Cali because houses ‘go up’ there & is interviewing there right now - thinks he will find a bargain. Good riddance.
South Orange county is actually quite nice, overpriced yes, but very nice. The crime rate is very low, the schools are good, and it is very family friendly. LA is another story…old, run down, dirty and high crime
I just moved to North Hollywood(by L.A.) and I like it here. The only thing that sucks is the traffic. I actually like the smog because I am really light complected and the smog blocks out the sun and I don’t get bad sunburns here, he-he. After the housing market crashes i’m going to by a condo and pay 50% down on it(hopefully)…My payments will be so low that I will be able to work part-time / therefore traffic will not bother me as bad anymore…..crash baby CRASH !!
Check out this article…. http://online.barrons.com/article/SB113962369561471498.html?mod=9_0031_b_this_weeks_magazine_main
It sums everything up in a nutshell!! These idiot real estate bimbos are going to get their heads handed to them! I can’t wait to see all the lawsuits!!
Agree the market has changed and the tide is going out. Prices are still way out of whack. To give an example my home sold for $14 a sf when it was brand new, the ones with views sold for $15 sf. It just sold for $446 sf. I’m not sure I would want to pay that but somebody did. I lowered the price so it would sell and never looked back. A lot of sellers are still priced from a year ago (high tide).
Been listening to Bloomberg News all morning… all they can talk about is Mr. B and his guaranteed rate increases. They keep quoting Ben B and his opinion that HOUSING is out of Whack.
Things that make you go hmmmmmmmmmmmmmm.
Sounds like this thing is heating up BIG TIME.
Forgive me if it’s already been posted, but DQ’s official numbers for Southern CA are out — sales hit a five year low, by their tally. Press release here:
http://www.dqnews.com/RRSCA0206.shtm
DQ shows a 16% drop in sales for Jan. Y-O-Y in San Diego. It was a 30% drop in my marketplace (North SD County houses) for January 06, and in Feb so far it’s 33% fewer sales. The high-end is what’s hurting, and it’ll squish down the rest of the pack.
bubbleinfo.com
David Lareah will dispute that.
Here’s a link to that murder I referred to earlier…
Has the Housing Bubble Killed Someone?
From CNN…
http://www.cnn.com/2006/LAW/02/14/entwistle.documents/index.html
“Entwistle, a 27-year-old from Britain, is accused of shooting his wife, Rachel, 27, and their 9-month-old daughter, Lillian, on the morning of January 20, possibly because of financial problems.
Entwistle had not worked since last September, and the family was paying $2,700 a month for their Hopkinton, Massachusetts, home, the documents say.
“I believe that there may be a financial motivation for this murder,” Massachusetts State Police trooper Michael Banks wrote in an affidavit.”
Yes, he was nuts. Yes, there were probably other things involved…
But the question remains…
Did this guy lose it because he found out he was underwater, due to the Housing Bubble?
Entwhistle was renting that house.
Comment by Desert Dweller
2006-02-15 12:23:30
The use of all-caps and exclamation points by these realt-whores is hilarious. I’ve noticed in our local MLS a lot of this kind of stuff lately. They’re either jacked up on Starbucks or panicking over the fact that they’ll have to find another line of work soon.
LOL, these realtwhores are not jacked up on Starbucks, they are suffering Starbucks withdrawls! They can no longer afford their $4 cup of coffee several times of day.
The Starbucks across the street from my work is now EMPTY…and I work at a library, a prime location for a Starbucks, you can buy a coffee, and either laze around the Starbucks or the library reading books and discussing whatever topics for the day, i.e., doing anything besides real work. A few of the old Crackbucks (thats what we call Starbucks) addicts are still hanging around the library listlessly, minus their coffee.
I noticed that lately we’ve been checking out alot of books related to real estate flipping, repairing bad credit scores, bankruptcy, how to get out of debt, Rich Dad Poor Dad series, and how to live frugally. Nothing makes me snicker more than seeing a down on their luck stressed out realtwhore checking out books on bankruptcy and some free DVDs and then driving away in their leased Lexus. Or leased SUV if they have kids. It makes me want to stop by a Crackbucks on the way to work and sit a coffee on my desk for them to stare at while they check out their Rich Dad Poor Dad books.
JUST OUT! Washinton Mutual to cut 2500 Mortgage Jobs, close 10 offices
http://biz.yahoo.com/ap/060215/washington_mutual_job_cuts.html?.v=2
I’ve been here in Orange County since 1976. Used to be paradise… lots of orange groves, wide open brand new 57 freeway, clean beaches with clean water.
All of that has COMPLETELY changed. Now this place has been swallowed up by the Los Angeles tentacles. Around-the-clock traffic jams keep you a prisoner in your own home, the beaches are infected with bacteria, and public parks are littered with trash. Orange County is now “urban.” Looking forward to getting out of here.
IO Mortgages In OC with a $500 per month BMW payment on top?
No wonder OC is filled with stressed out losers. HA HA HA HA
And thought it was the drinking water in OC or something.