Southland home sales slowest in nine years

[rocketman]

A new article on DataQuicks wesbite writes:

http://www.dqnews.com/RRSCA0806.shtm

A total of 22,712 new and resale homes sold in Los Angeles, Riverside, San Diego, Ventura, San Bernardino and Orange counties last month, DataQuick Information Systems reported. That was down 22.3 percent from 29,237 sales in June and down 26.9 percent from 31,069 sales in July last year.

Last month’s sales total marked the lowest for a July since 1997, when 22,302 homes sold, and fell below the July average of 24,669 going back to 1988. The strongest July was in 2003, when 33,561 homes sold, while the weakest was in 1995, with 15,077 sales…

“The relatively large drop in sales last month may be nothing more than a statistical blip, but it could also be a sign of fast-petering demand for homes at today’s prices,” said Marshall Prentice, DataQuick president.

“Our sense has been that many who bought homes in recent years purchased them sooner than they otherwise would have because of very low interest rates and a great sense of urgency, given the fear of being priced out forever or missing out on a great investment. That phenomenon helps explain why there’s not more demand today. Whether July’s data also signal something more ominous at work in the market – something that would cause a severe correction in home values – is unclear to us. We’ll know a lot more in a few months…

Note: I noticed that CTX and LEND both had extrodinary advances in the market today. Who are these investors? I have a bridge I’d like to sell them.

[(former)FormerSanDiegan]

“Note: I noticed that CTX and LEND both had extrodinary advances in the market today. Who are these investors? I have a bridge I’d like to sell them.”

Maybe the short sellers are buying the shares to lock in their profits. Not sure you want to sell a bridge to those guys.

[(former)FormerSanDiegan]

Interesting tidbits from this article:

Monthly Carrying Costs

The typical monthly mortgage payment that Southland buyers committed themselves to paying was $2,437 last month, the same as the previous month and up from $2,052 a year ago. Adjusted for inflation, current payments are about 6.2 percent above typical payments in the spring of 1989, the peak of the prior real estate cycle.

Interesting that we are ~ 6% above the last peak in this number. I’d like to see a long-term plot of monthly mortgage cost over the last two SD or SO Cal real estate cycles.

Anyone know where we might find ?

Statistical Anomaly … Not

The article has the following statement “Southland sales have declined for eight consecutive months on a year-over-year basis.” followed by a comment that the drop may be “nothing more than a statistical blip,”
Doesn’t the first comment indicate that it’s a trend. A statistical blip would be a data point that deviates from the trend, not one that confirms it. What a dope !

[rocketman]

I can imagine that they might be buying for that reason, however if they can move volume like that, then yes, I would like to sell them a bridge like the one I sold Robert McCulloch.

[an]

Wow, I’ve been following DQNews data for awhile now and the declining rate of appreciation is increasing. It’s -1.8% in San Diego now. It was 0.8% last month.

[powayseller]

What ever happened to Rightside’s short trade of LEND? Do you guys think he’s still hauling in the dough on that trade? I missed out on a good trade…, but I was too chicken to short any stocks.

an – increasing and decreasing rates of change (now I know why we had to study derivatives in calculus) forecast the direction of the market, right? Real estate prices slowly top rising, top out, slowly turn down, then pick up speed. I think it will accelerate onthe way down. Maybe next month it is -4%.

[Californiabrownbear]

This story made it to the Drudge Report yesterday!

[rocketman]

Thanks Powerseller

I am glad you said that you were nervous to short LEND. I am a little too nervous to jump in right now as well. I think we missed the boat on LEND (down .01% today) until the Fed makes another cut.

As another note, the Network’s up here in the Bay area have been running short news stories on the decline of real estate prices up here in the Bay area. Someone (of RE authority) has been sending them PR reports that prices have declined 25% (what a bunch of baloney) and that this is a “good time to jump in and buy”. I was thinking of sending them a statement indicating that they need to check their sources for accuracy before releasing such news.

[no_such_reality]

sending them PR reports that prices have declined 25%

Actually, that’s not that far off. There is a major difference between what people thought the market was at and where houses are actually selling. Link

Not to mention where houses are now selling, and houses that get bought this month, really close at next month and reported the one after that. Remember, July numbers are really for homes agreed to in June. So a home “bought” in August, closes in September and is reported just before Halloween…

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