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NotCranky.
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May 30, 2007 at 5:19 PM #55584May 30, 2007 at 5:19 PM #55603
SD Realtor
Participantjg – Just curious but on your chart, I assume each dot is a data point that represents the median price for a particular month correct? I am not disparaging anyone here but I am trying to understand the chart better. For instance I took the simple average of the sales for 92037 resale homes from 4/1/07 – 5/1/07 and my average came out to 2.217 million for the 31 detached homes that were sold. Now I didn’t use condos, just detached homes.
Anyways like I said, I am just trying to better understand the data you presented.
SD Realtor
May 30, 2007 at 5:53 PM #55586(former)FormerSanDiegan
Participantjg’s chart is an excellent example of the variability of monthly zip code specific median price.
Monthly data is very noisy because the sales from one month are from a sample of homes that are different from the sample from subsequent months.
You must separate the signal form the noise.
I have plotted a blow-up of recent La Jolla Price history below. There is a lot of fluctuation from month to month.
The general trend is that the median price is about what is was at the end of 2004. But drawing general conclusions about the La Jolla sub-market based on a single monthly number is misleading.The La Jolla data showed a 20% increase from July -Sept 2006. How many here think that accurately represents the La Jolla Market ?
According to the monthly data the La Jolla median is UP over 9% from the end of last year. Making a conclusion that the general price trend in LJ is currently up would be dangerous. I recommend that you look at the big picture.
[img_assist|nid=3537|title=La Jolla Median Price SFR|desc=|link=node|align=left|width=466|height=349]
May 30, 2007 at 5:53 PM #55605Participantjg’s chart is an excellent example of the variability of monthly zip code specific median price.
Monthly data is very noisy because the sales from one month are from a sample of homes that are different from the sample from subsequent months.
You must separate the signal form the noise.
I have plotted a blow-up of recent La Jolla Price history below. There is a lot of fluctuation from month to month.
The general trend is that the median price is about what is was at the end of 2004. But drawing general conclusions about the La Jolla sub-market based on a single monthly number is misleading.The La Jolla data showed a 20% increase from July -Sept 2006. How many here think that accurately represents the La Jolla Market ?
According to the monthly data the La Jolla median is UP over 9% from the end of last year. Making a conclusion that the general price trend in LJ is currently up would be dangerous. I recommend that you look at the big picture.
[img_assist|nid=3537|title=La Jolla Median Price SFR|desc=|link=node|align=left|width=466|height=349]
May 30, 2007 at 6:07 PM #55588ParticipantMay 30, 2007 at 6:07 PM #55607ParticipantMay 30, 2007 at 6:09 PM #55590ParticipantFSD you make a very good point which, I think, is kind of providing some validation to some of the counterpoints posted in this thread. That is, monthly median data is perhaps a bit unreliable to point out long term trends. There is not doubt whatsoever in my mind of prolonged depreciation over the next few years. I will say it is only my opinion that higher desired neighborhoods will not be hit as hard as less desired neighborhoods but that is only an opinion and I could very well be wrong. However I am just not sure I agree with the pace of depreciation that people are preaching, almost longing to find data to back up. By the same token I can find ALOT of pricing that is at 2004 and even 2003 levels for many areas around the county.
My post was simply to correlate the graph to the actual MLS data for detached homes for the month of April of 07.
May 30, 2007 at 6:09 PM #55609ParticipantFSD you make a very good point which, I think, is kind of providing some validation to some of the counterpoints posted in this thread. That is, monthly median data is perhaps a bit unreliable to point out long term trends. There is not doubt whatsoever in my mind of prolonged depreciation over the next few years. I will say it is only my opinion that higher desired neighborhoods will not be hit as hard as less desired neighborhoods but that is only an opinion and I could very well be wrong. However I am just not sure I agree with the pace of depreciation that people are preaching, almost longing to find data to back up. By the same token I can find ALOT of pricing that is at 2004 and even 2003 levels for many areas around the county.
My post was simply to correlate the graph to the actual MLS data for detached homes for the month of April of 07.
May 30, 2007 at 6:22 PM #55592DaCounselor
Participant“But the real issue here is, the direction of prices, which doesn’t appear to be, up.”
______________________________That’s not the issue presented in this thread. The screaming all-caps issue is whether high-end properties in OC have been WHACKED yoy. ls2008 argues they have been – based on data I find flimsy and unreliable. I don’t need to bring data to refute the fact that ls2008’s posted median low-volume yoy data is flimsy support for the WHACKED conclusion being drawn – the data is what it is. Everyone here can draw their own conclusions regarding the data being offered in support of ls2008’s allegation and weigh it as they wish.
My general point, as originally raised, is that on this site most folks have graduated well beyond yoy median data reliance (particularly in a low volume environment) and now typically want to see much more meaningful data, particulary when someone is trying to back up a screaming headline. One need not venture far into other screaming sky-is-falling headline threads on this site to find an ultimate…”uh, never mind”…end results.
May 30, 2007 at 6:22 PM #55611Participant“But the real issue here is, the direction of prices, which doesn’t appear to be, up.”
______________________________That’s not the issue presented in this thread. The screaming all-caps issue is whether high-end properties in OC have been WHACKED yoy. ls2008 argues they have been – based on data I find flimsy and unreliable. I don’t need to bring data to refute the fact that ls2008’s posted median low-volume yoy data is flimsy support for the WHACKED conclusion being drawn – the data is what it is. Everyone here can draw their own conclusions regarding the data being offered in support of ls2008’s allegation and weigh it as they wish.
My general point, as originally raised, is that on this site most folks have graduated well beyond yoy median data reliance (particularly in a low volume environment) and now typically want to see much more meaningful data, particulary when someone is trying to back up a screaming headline. One need not venture far into other screaming sky-is-falling headline threads on this site to find an ultimate…”uh, never mind”…end results.
May 30, 2007 at 7:11 PM #55610latesummer2008
ParticipantWhy is the Volume Low? Because, people aren’t buying. Plain and simple. That isn’t that hard to understand. To me, that is the real story and is more troublesome than the big drop in median price. You are on the moon, if you can’t see the number of sales, has dried up further and further, each month. Why? I’ll tell you why.
1) Prices are too high
2) Buyers are waiting for prices to drop further
3) Qualifying for loans has gotten much harder
4) Speculators and Flippers are gone.
5) Buyers have better access to RE information
6) 99.9% of the news coming out is bad about RE
7) ARM Resets
8) Record Inventory
9) Record Increase In Foreclosures
10) 1st National decline in Housing since 1991 (Case Schiller Index)
11) Deepest slide in appreciation since The Great DepressionNeed I go on?
What is so difficult to understand? THE MARKET SUCKS..
Go ahead Da Counselor, jump in! Buy a house. I’m sure you will have a quite a choice.
May 30, 2007 at 7:11 PM #55629ParticipantWhy is the Volume Low? Because, people aren’t buying. Plain and simple. That isn’t that hard to understand. To me, that is the real story and is more troublesome than the big drop in median price. You are on the moon, if you can’t see the number of sales, has dried up further and further, each month. Why? I’ll tell you why.
1) Prices are too high
2) Buyers are waiting for prices to drop further
3) Qualifying for loans has gotten much harder
4) Speculators and Flippers are gone.
5) Buyers have better access to RE information
6) 99.9% of the news coming out is bad about RE
7) ARM Resets
8) Record Inventory
9) Record Increase In Foreclosures
10) 1st National decline in Housing since 1991 (Case Schiller Index)
11) Deepest slide in appreciation since The Great DepressionNeed I go on?
What is so difficult to understand? THE MARKET SUCKS..
Go ahead Da Counselor, jump in! Buy a house. I’m sure you will have a quite a choice.
May 30, 2007 at 9:23 PM #55630cyphire
ParticipantCouple of points which I NEVER see in any of these blogs… As it relates to the wealthier areas.
The run up in prices has been crazy – but it pales in comparison to how much richer the wealthy have become during the current administration (and before).
The top income earners are not only making most of the additional wealth these days (the middle class is slowly declining in buying power), but due to the tax cuts are keeping a greater percentage. The federal rate on capital gains is 15% etc.
The wealthier people are competing with other wealthy people for the really great properties – and these get sold. They have literally nothing to do with the current housing crisis.
Take example where I live, La Jolla CA. A wealthy community (not everyone, but here is where the wealthy live) and the folks in this town with money own the stocks, have stakes in the mergers, etc., are the CEO’s (and all the outrageous salary/options that go with it) and have gotten far wealthier in recent times. Home prices for the good properties (remodeled, new, ocean views, square footage larger than 3K feet, large lots, etc.) have come off their unrealistic heights and are now merely insane. But these properties are the exception rather than the rule. They sell because they are a limited quantity and supply and demand does apply. There are many wealthy buyers fighting over the excellent properties. As these are the properties that sell, they bring up the median.
The vast majority of the homes have flaws. They don’t have a full ocean view, they are 2,900 feet or smaller, they are on tiny lots (La Jolla only allows you to build a house which is 60% of your lot size – example a 4K sq foot lot yields a house which is 2,400 feet max), are near busy roads or schools, or they were last updated before Elvis died. These house are sitting on the market for months and months. They are still insanely priced, but they aren’t selling. This is why the median is up in the wealthier communities.
Where I live (by the beach), there are properties just east of me which are old, smelly, and still priced in with a 250% increase from 5 years ago. Even when they come down to 150% increase, they still are tiny, smelly, crappy, etc. and in a market where people have lost their “everything will increase” mentality, they just won’t move.
In La Jolla 2 years ago, you could buy a 1.2 million dollar moldy, smelly, cruddy, 2,000 sq foot house with no view, put a new kitchen in, new carpet, etc. and sell it for 1.8 million. Those days are over, but even if the house prices are down 10% or more, the buyers who will step up and buy the cleaned up tiny house for over 1.5 million are gone… Because at the end of the party, they are just that… Smelly, tiny, crappy, and filled with termites and no one wants to wake up and realize that they just paid 1M+ for this kind of property.
May 30, 2007 at 9:23 PM #55649ParticipantCouple of points which I NEVER see in any of these blogs… As it relates to the wealthier areas.
The run up in prices has been crazy – but it pales in comparison to how much richer the wealthy have become during the current administration (and before).
The top income earners are not only making most of the additional wealth these days (the middle class is slowly declining in buying power), but due to the tax cuts are keeping a greater percentage. The federal rate on capital gains is 15% etc.
The wealthier people are competing with other wealthy people for the really great properties – and these get sold. They have literally nothing to do with the current housing crisis.
Take example where I live, La Jolla CA. A wealthy community (not everyone, but here is where the wealthy live) and the folks in this town with money own the stocks, have stakes in the mergers, etc., are the CEO’s (and all the outrageous salary/options that go with it) and have gotten far wealthier in recent times. Home prices for the good properties (remodeled, new, ocean views, square footage larger than 3K feet, large lots, etc.) have come off their unrealistic heights and are now merely insane. But these properties are the exception rather than the rule. They sell because they are a limited quantity and supply and demand does apply. There are many wealthy buyers fighting over the excellent properties. As these are the properties that sell, they bring up the median.
The vast majority of the homes have flaws. They don’t have a full ocean view, they are 2,900 feet or smaller, they are on tiny lots (La Jolla only allows you to build a house which is 60% of your lot size – example a 4K sq foot lot yields a house which is 2,400 feet max), are near busy roads or schools, or they were last updated before Elvis died. These house are sitting on the market for months and months. They are still insanely priced, but they aren’t selling. This is why the median is up in the wealthier communities.
Where I live (by the beach), there are properties just east of me which are old, smelly, and still priced in with a 250% increase from 5 years ago. Even when they come down to 150% increase, they still are tiny, smelly, crappy, etc. and in a market where people have lost their “everything will increase” mentality, they just won’t move.
In La Jolla 2 years ago, you could buy a 1.2 million dollar moldy, smelly, cruddy, 2,000 sq foot house with no view, put a new kitchen in, new carpet, etc. and sell it for 1.8 million. Those days are over, but even if the house prices are down 10% or more, the buyers who will step up and buy the cleaned up tiny house for over 1.5 million are gone… Because at the end of the party, they are just that… Smelly, tiny, crappy, and filled with termites and no one wants to wake up and realize that they just paid 1M+ for this kind of property.
May 30, 2007 at 9:38 PM #55635Anonymous
GuestGood guess, SDR: each dot is the median price for a resale home in La Jolla over ’88-’07.
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