Comments on: Southern California Housing Report: New Housing Motto: Foreclosure Data is so Bad, it has to be Good! Median Price Down 31% to $348,000. http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/ How I Learned to Love Southern California and Forget the Housing Bubble Fri, 09 Jan 2009 13:46:55 +0000 http://wordpress.org/?v=2.2.2 By: yanni raz http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22559 yanni raz Fri, 22 Aug 2008 16:02:50 +0000 http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22559 CALIFORNIA HOME SALES UP UN JULY California Real Estate market gave signs of relief. Home sales went up 12.3 percent in July compare to the same month last year. According the Quick Data, a company that monitors Real Estate Activity nationwide. Of the homes sold 44.8 percent were foreclosure resales. The median home price last month was 318,000 down 3% from 328,000 for the month before and down 33.5 percent from July a year ago. Most of the drop in home prices is due to the depreciation properties are facing because of the mortgage meltdown. Not even the most knowledgeable Real Estate indicators know exactly where the market is going. Foreclosure activity is at record levels, banks are asking for tougher requirements, non-owner occupied homes are almost impossible to re-finance. CALIFORNIA HOME SALES UP UN JULY

California Real Estate market gave signs of relief. Home sales went up 12.3 percent in July compare to the same month last year. According the Quick Data, a company that monitors Real Estate Activity nationwide.

Of the homes sold 44.8 percent were foreclosure resales.

The median home price last month was 318,000 down 3% from 328,000 for the month before and down 33.5 percent from July a year ago. Most of the drop in home prices is due to the depreciation properties are facing because of the mortgage meltdown.

Not even the most knowledgeable Real Estate indicators know exactly where the market is going. Foreclosure activity is at record levels, banks are asking for tougher requirements, non-owner occupied homes are almost impossible to re-finance.

]]> By: compass rose http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22520 compass rose Thu, 21 Aug 2008 21:10:14 +0000 http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22520 I was wrong. It wasn't a cannonball in the teeth. It was a bazooka in the pocket. http://www.bloomberg.com/apps/news?pid=20601110&sid=aPXHiGcv1OvU rose I was wrong. It wasn’t a cannonball in the teeth. It was a bazooka in the pocket.

http://www.bloomberg.com/apps/news?pid=20601110&sid=aPXHiGcv1OvU

rose

]]> By: exit http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22500 exit Thu, 21 Aug 2008 15:57:34 +0000 http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22500 I'm fairly confident we're all working on the same assumption that significant price drops are in the works all over, and differ in severity only by zip code (or even smaller geographical units.) I wonder if the difference isn't so much between bulls and bears, but between bears and get-the-bomb-shelter-ready camps. I fully expect most areas to revert to the long-term mean of appreciation essentially matching inflation (with an overshoot to the downside before it re-calibrates). This will entail prices dropping to 3.5 to 5x income in prime coastal areas, less than that in less desirable areas, and pockets which defy 'common sense' because the wealthy set their own rules. All data sets are fluid, not static, prices are set at the (now rapidly increasing) margins, but the bulk of present day owners will not default. That failure may hit 20% is astonishing, unprecedented, and sickening to the defaulters and to the banks. But it will NOT mean that Malibu or Laguna Beach are going to drop to 1999 prices (even adjusted for inflation) unless, of course, Roubini turns out to be too bullish in his predictions. And if that's the case - be careful what you wish for, because I don't know of too many bomb shelters in the OC. I’m fairly confident we’re all working on the same assumption that significant price drops are in the works all over, and differ in severity only by zip code (or even smaller geographical units.) I wonder if the difference isn’t so much between bulls and bears, but between bears and get-the-bomb-shelter-ready camps.

I fully expect most areas to revert to the long-term mean of appreciation essentially matching inflation (with an overshoot to the downside before it re-calibrates). This will entail prices dropping to 3.5 to 5x income in prime coastal areas, less than that in less desirable areas, and pockets which defy ‘common sense’ because the wealthy set their own rules. All data sets are fluid, not static, prices are set at the (now rapidly increasing) margins, but the bulk of present day owners will not default. That failure may hit 20% is astonishing, unprecedented, and sickening to the defaulters and to the banks. But it will NOT mean that Malibu or Laguna Beach are going to drop to 1999 prices (even adjusted for inflation) unless, of course, Roubini turns out to be too bullish in his predictions.

And if that’s the case - be careful what you wish for, because I don’t know of too many bomb shelters in the OC.

]]> By: Dan http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22458 Dan Thu, 21 Aug 2008 00:41:37 +0000 http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22458 Doc is great! The main damage when it is all over will be done to the gheto and will go towords the beaches, but nobody will be safe. When prices on one particurar city colapse it afects neighbouring cities ( neighboring in a socio-economic way) and this ripple efect goes from Lancaster to Beverly Hills. There is convolution efect on prices. Let say 20% drop in Lancaster will cause efect of 1% drop in Beverly Hills, but 20% drop in Santa Monica will cause 15% drop in Beverly Hills. An this is happening becouse the "killing of demand" and change in prices in Santa Monica on prices in BH is by far bigger because they share almost the same buyers pool, not so with Lancaster. This waves will go like this back and fort few times till we have new equilibrium of prices. And at the bottom of the foodchain where it started we will see drops of 60-70% and in the choosen coastal areas ( not all of them) only 30% when the dust is setled. That is my working theory. Doc is great!
The main damage when it is all over will be done to the gheto and will go towords the beaches, but nobody will be safe. When prices on one particurar city colapse it afects neighbouring cities ( neighboring in a socio-economic way) and this ripple efect goes from Lancaster to Beverly Hills. There is convolution efect on prices. Let say 20% drop in Lancaster will cause efect of 1% drop in Beverly Hills, but 20% drop in Santa Monica will cause 15% drop in Beverly Hills. An this is happening becouse the “killing of demand” and change in prices in Santa Monica on prices in BH is by far bigger because they share almost the same buyers pool, not so with Lancaster. This waves will go like this back and fort few times till we have new equilibrium of prices. And at the bottom of the foodchain where it started we will see drops of 60-70% and in the choosen coastal areas ( not all of them) only 30% when the dust is setled. That is my working theory.

]]> By: ToadB http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22449 ToadB Wed, 20 Aug 2008 20:41:05 +0000 http://www.doctorhousingbubble.com/southern-california-housing-report-new-housing-motto-foreclosure-data-is-so-bad-it-has-to-be-good-median-price-down-31-to-348000/#comment-22449 I do agree that the rich have separate rules, but that's a whole another can of worms. It really makes no difference to me what happens to the mighty mansions of Malibu. They are a tiny part of the market, and it's the rest that matters to me. Btw, is it true that foreclosures count in the sales data? I have heard this mentioned before, but I have no idea if it's correct or not. If it is doesn't that throw the numbers completely off? I do agree that the rich have separate rules, but that’s a whole another can of worms. It really makes no difference to me what happens to the mighty mansions of Malibu. They are a tiny part of the market, and it’s the rest that matters to me.

Btw, is it true that foreclosures count in the sales data? I have heard this mentioned before, but I have no idea if it’s correct or not. If it is doesn’t that throw the numbers completely off?

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