Whether the residential RE market in CA is currently holding its own or increasing in value is entirely local … on a micro-level.
I’ve been “saving” SFR listings online located in Napa, Sonoma and Mendocino counties since about mid-January 2015.
I just visited my “saved” listings today and had to delete all 14 of them which were “withdrawn” from the market just day(s) or week(s) after listing. The majority of these were last purchased in 2007 (the sellers obviously didn’t feel they could even get within $20K of what they paid in 2007), not even taking into account the costs of selling.
I’m finding that there are a lot of would-be sellers out there “testing” the market this spring.
Only one actually sold, a listing in Rohnert Park, a relatively “close-in” city in Sonoma County (not rural or semi-rural as are most of the areas I’m interested in). It sold for $2K more than asking price in less than 60 days (incl escrow period).
Yes, the closer-in bay area counties are “on fire” and thus devoid of listings which last more than 3 days but that is not the case everywhere in CA.
My spot checks in LA County show that SFR listings seem to be disappearing fast everywhere … at all price points. Even heavy fixers in “working-class” areas are selling fast there! Condos seem to be taking twice as long to sell as SFRs but do sell nonetheless. Except for just a handful of small cities which still have too many current short-sale and FC listings, the distressed inventory seems to have been cleared out of LA County. Some zip codes and micro areas in LA County are every bit as “hot” as the bay area right now … market wise.
LA County has next to zero “community facilities districts” (areas with MR) and far fewer neighborhoods with HOAs than does San Diego County as it is far more well-established. Thus, it never had degree the distress that SD, RIV and San Bern Counties did (Orange Co to a much lesser degree). Most of LA County’s residential distress appears to me to have resulted from homeowners taking out subprime cash-out refis and HELOCs during the “easy-lending” era … much moreso than homebuyers who simply bought at the wrong time.
Even in SD County, there are still small pockets all over the county which still have too many current “distressed” listings dragging down local asking prices (and likely future sold comps). Would-be sellers would be better off waiting to list if at all possible if their properties are located in any of these micro-areas, IMO.
In all cases, I don’t think interest rates, the state of the economy or perception of future water availability have a damn thing to do with anything, especially in CA coastal counties. It’s obvious to me that when a listing closes escrow 10-20 days after being first listed, it was an all-cash sale.
