It’s been a while since I updated the mortgage interest rate chart.
As you can see, rates have crept downward since my last update and are now near their lows of late 2006.
It’s been a while since I updated the mortgage interest rate chart.
As you can see, rates have crept downward since my last update and are now near their lows of late 2006.
I want to rent . . . wife
I want to rent . . . wife wants to buy . . . her best friend’s husband is realtor who beats the drum of “inventories in San Diego have stablized” and the bottom is near. He points to Las Vegas inventories as a market that is still inflated. Do the inventory numbers matter??? How much??? San Diego’s numbers has stabilized (lull before the crash or the rebound???). Las Vegas hasn’t stabilized.
San Diego inventory
[img_assist|nid=2955|title=SD Inventory|desc=|link=node|align=left|width=454|height=500]
Las Vegas inventory
[img_assist|nid=2954|title=LV Inventory|desc=|link=node|align=left|width=437|height=500]
In search of a crystal ball . . . .
Inventories are at all time
Inventories are at all time high for March. Extend your graphs to show year-over-year data and you will see almost the same inventory today than a year ago. This summer we could again see similar 22K+ listings as 2006. The site below has keep a good record since January 2006:
http://bubbletracking.blogspot.com/
Thanks for the link it also
Thanks for the link it also has great info . . . but the inventory numbers from your link show a leveling of inventory year over year. I.E. for 03/07 (18,249) vs 03/06 (18,261) is level for the last year with prices having come down from 538K to 510K year over year. I’m wondering if the leveling of inventory levels will be followed by price stabilization. Leveling of inventories has historically been a leading indicator, followed by price stabilization, followed by shrinking inventories (prices still level but at bottom), followed by eventual price rise after inventories contract 50% from their high. History has shown this . . . . I’m trying to discern whether we are seeing the first of several indicators (inventory stabilization). It appears so. I got the data above from the following site.
http://www.housingtracker.net/askingprices/California/SanDiego-Carlsbad-SanMarcos/
Follow up: The site you mentioned gets its data from ZipRealty which includes vacant lots for sale in its numbers. If you limit the search to exclude undeveloped land the inventory is at 16,192 as of today, which is very close to the 16,746 for the above graph which is for 03/07. Prices have come down 6% and inventories have stopped rising. Is this a pause before another leg down or the beginning of a long bottoming process. With inventories stabilizing its hard to make the case for another leg down. Hard to discern . . . what to do? what to do?
In search of a crystal ball . . . .
schizo, make sure you read
schizo, make sure you read these couple of posts on my blog and ask the realtor friend to explain why these NODs are not on the MLS.
Where did the inventory go?
Phantom Inventory
in SD we are seeing a lot of these NODs that are not even listed on the MLS, same goes for the rest of SoCal, in lesser degree. one reason is these NODs are already underwater by so much that putting the property on the MLS is just a big waste of time. might as well enjoy a few months of rent-free/mortgage-free living until the auction date.
Phantom Inventory???
Aren’t
Phantom Inventory???
Aren’t most of the homes which are foreclosed or short sold immediately placed on the market by the banks??? I believe this is the case. Also most sane people will list their home at some price once they can’t make the payments either before or after the NOD is filed. I don’t see the case for homes which should be considered part of inventory but which are not listed????
A google search on one of the props your link discusses 16556 CIMARRON CREST shows that it is listed for sale with a realtor (Voak Realty).
Thats the problem at this stage of the market . . . is that people at both ends (all is OK as I pray RE will soon rise crowd AND the sky is falling get out while you can crowd) are running around with their hair on fire. Makes it difficult to get good objective facts. I am renting but am considering buying and have the resources to do so . . . but don’t want to committ any extra $ if I don’t have to. How much of what goes no here is “sour grapes” from renters with no prospects of owning even with a 40 to 50% contraction and how much is objective facts . . . . still searching. Real data such as MLS inventory and Median home prices trended out over the last 12 months is devoid of emotion and relevant to the analysis . . . much of the blogosphere is less so.
PS.
Where do I go to find “In San Diego we see a lot of these NOD that aren’t listed in inventory.” Who is “we” and where can I see this “a lot” for “San Diego” ???? I’m always looking for good information (vs. opionion). Please post a link to at least semi-comprehensive data on this . . . anecdotal examples interesting but of little value.
In search of a crystal ball . . . .
the cimarron crest property
the cimarron crest property on my post IS NOT 16556, it is 16612. if you read my post closely, you would see the reason why it isn’t for sale. it was purchased at $805,000 with $764,000 of it financed. new homes of similar size in 4S Ranch are going for $715,000. this is why this home is not listed on the MLS.
the 16556 example you found via google has a lot of equity, the owner got it for around $500,000. the current asking price of $815,000 is the owner’s wishing price.
reason why I say this is a “phantom inventory” is because it takes 4 months for a NOD to grow up and become a REO. In 2006, these NODs were almost ALL on the MLS, short sale or not. In 2007, they are largely absent because of the situation I described with 16612. once it becomes REO, then yes, the phantom inventory becomes real inventory. but remember, that’s a 4 month lag time.
as far as anecdotal examples
as far as anecdotal examples being of little value. hard data itself is of little value too.
when I started tracking inventory, the numbers are great, but what’s going on? why did the numbers rise, who are the sellers? how come this year’s inventory didn’t rise as fast as last year? we know sales are still roughly 30% less than last year. So people that de-listed in winter of 2006 simply did not put their listings back on.
so are all of the de-listed listings all market testers?
that’s what we thought last winter. that we may see a drop in inventory due to market testers leaving the market. but you poke around some more and there’s another side to the drop in inventory: folks that needed to sell but simply gave up. not only do we have the cimirron crest example in 4S, but we also have the San Marcos example, I think that’s a pretty powerful statement when the only home for sale on the street is not in foreclosure process at all, but 4 homes on the street with NODs are not even trying to sell.
more example? 4 homes in the Del Norte Cottages community near 4S with NOD, again, none of them are listed for sale. What about South Bay? 4 homes on Table Rock Ave with NODs, just one is listed with the MLS. go up north to Lake Elsinore, we got a street with 6 NODs, only one is listed on the MLS.
all anecdotal examples. all worthless in your opinion, but multiple anecdotal examples all pointing to the same thing sometime points to a possible trend.
My apologies on the TYPO . .
My apologies on the TYPO . . . I meant to put 16612 and not 16556 Cimarron Crest. But my point remains the same . . . it (16612) is listed for sale. Simply google “16612 Cimarron Crest” and after passing through all the RE blogs you can see that it is for sale by “Voak Homes.” Here is the link . . . .
http://www.homethinking.com/broker/California/San_Diego/Scott_C._Voak?selling
No phantom here.
As to your reliance, in your own words, on multiple instances of ancedotal evidence SEE Wikipedia “anecdotal evidence”
Anecdotal evidence is often unscientific because it cannot be investigated using the scientific method. Misuse of anecdotal evidence is a LOGICAL FALLACY and is sometimes informally referred to as the “person who” fallacy (“I know a person who…”; “I know of a case where…” etc. Compare with hasty generalization). Anecdotal evidence is not necessarily typical; STATISTICAL EVIDENCE can more accurately determine how typical something is.
http://en.wikipedia.org/wiki/Anecdotal_evidence
My point being . . . statistical evidence based on comprehensive fact of SD RE inventory clearly shows a leveling. Anecdotal claims of “phantom” inventory (one which is in fact listed for sale) are again “interesting but of little value.”
The bigger question you may want to ask is do you have a pre-concieved conclusion which you are in search of facts to support.
Adalai Stevenson (presidential candidate 1952) used to make fun of opponents’ arguments by saying, mockingly, “Here is the conclusion on which I will base my facts.”
My LIMITED experience in matters financial (RE to Stock Market) is that many at both ends of the spectrum are guided by such fallacious reasoning.
“To be scientific in our approach to the markets, we need to be ruthlessly empirical in following the lead of the data, in whatever direction it might take us, regardless of our preconceived notions. That’s a tall order, I know.
But the alternative is to lead one’s investment life in denial, divorced from reality. And that can’t be a good investment strategy.” – Mark Hulbert, financial analyst
http://www.marketwatch.com/news/story/now-not-inverted-yield-curve/story.aspx?guid=%7B308184EA%2DA2A2%2D4B4E%2DA55A%2DDA251E680AA8%7D
I have no ax to grind either way (i.e. I’m not a homeowner or RE broker living in an unrealistic fantasy land, but neither am I a gloating renter who probably couldn’t or wouldn’t buy during any phase of the SD RE cycle and simply passes the time blogging re others fortunes or misfortunes . . . .).
I am renting and will certainly buy at the next appropriate point in the SD RE cylce. I just want to time my decision appropriately. Nothing here logically addresses or acknowledges what is ocurring CURRENTLY in the San Diego RE market. Namely inventories have leveled and stablized after a 6% price decline. What does that portend? Further declines or a bottoming at this price level, perhaps for years (but no further leg down), eventually followed by inventory contraction and price appreciation. Current facts, informed by historical trends, indicate this is what MAY be happening . . . anecdotal evidence notwithstanding . . . .
Spare me the chicken little “the sky is falling” anecdotes.
“The Sky is Falling, also known as Chicken Little, Chicken Licken or Henny Penny is an old fable of unknown origin about a chicken who believes the sky is falling. The phrase has also become used to indicate a hysterical or mistaken belief that disaster is imminent.”
http://en.wikipedia.org/wiki/The_Sky_is_Falling
Still . . .in search of a crystal ball . . . .
To be fair and “closely
To be fair and “closely read” your e-mail. I believe the 715K example from 4S Ranch is here . . . .
http://www.4sranch.com/view_home.aspx?home_model=2250
No doubt NEW CONSTRUCTION for sale at that price. I bought new construction (3500sq ft in Herndon, VA in 1995) and did the whole upgrades to the CRAP the builders put in the base model followed by decent but not extravigant landscaping. I KNOW that such upgrades and landscaping is anywhere from 70K to 100K. The examples at Cimarron Crest are completed homes (presumably some upgrades from the default crap) and as we can see on Zillow they are landscaped. The example of 715K at 4S is new, no upgrades, and no landscaping . . . and not a good comparison to the houses you mentioned on Cimarron.
http://www.zillow.com/aerial/DualMapPage.htm?zpid=58198045
After “closely” reading your post I find it is an exaggerated comparison of apples and oranges put forward to support a point of view . . . . “conclusion in search of facts.”
In search of a crystal ball . . . .
In your search for hard data
In your search for hard data don’t forget that there have been significant changes in the real estate market in just the last few weeks – the hard data you are seeking won’t take into account:
> no more 100% loans
> no more liar loans
> increased scrutiny by loan underwriters
I believe that these changes are going to impact the market significantly but the changes are too recent to be seen in the current data
Don’t talk yourself into buying until you see a few more months of inventory vs sales
Sound advice which i am
Sound advice which i am currently trying to process (the whole subprime implosion and how big of an affect will it have on upper-midclass housing in SD RE market). The whole subprime story has also been prone to exaggeration by both sides. I am certainly going to observe for at least the next few months. All my above rambling is simply seeking additional info on what may be a trend of leveling inventory combined with stablized prices. If this continues into the spring/summer season it may be time to step up to the plate and pull the trigger. I am in no hurry . . . .
In search of a crystal ball . . . .
schizo…
You are right that
schizo…
You are right that the current inventory looks to be leveling. However, ocrenter points out an plausible theory that could point to what the future might bring in terms of inventory.
Limiting yourself to existing statistics will impair the ability to project into the future. If one really wants a “crystal ball” one needs to look at several potential outcomes from a theoretical point of view and assess the likelihood of these outcomes based on the limited data or small number of observations (sometimes called anecdotes).
On a side note, I also have a problem with the term “phantom” inventory. It really should be considered pent-up supply or potential future inventory until it actually shows up on the market.
schizo, you pulled up a site
schizo, you pulled up a site with a lot of homes that are inactive and not even searchable by the MLS. ziprealty, which captures all active listings on the MLS, does not show the cimmeron crest listing.
as for the new home vs. old home comparison. the price includes $20,000 in incentives which I did not even bother including. there’s your flooring. the cimmeron crest listing hardly has room for landscaping, as it is squeezed into a small lot with back loading garages. oh, and guess what, the $715,000 new home example includes landscaping.
you don’t need to bother with definition of what anecdotal means. all I’m saying is data alone doesn’t give you the whole picture. you need to find out what’s the story behind the data.
sounds like you should just jump in and buy a home if you have such a hard time believing what you are seeing with my “anecdotal” examples. put your money where your mouth is, my friend.
Hmmm . . . sound advice . .
Hmmm . . . sound advice . . . “just jump in” . . . “put your money where your mouth is” . . . from someone feigning to be a “friend.” Let — me — say — it — in — a — little — plainer — language — for — you . . . . buying into the SD RE right now MAY be akin to catching a falling knife. Now is a good time to observe and gather information. I am content to earn 5.3% in a money market acct. (see ING DIRECT on accts of 100K+) with the equity gained from 10yrs in the Wash DC market as I RENT IN SAN DIEGO . . . . In spending time on this blog (that value of which is becoming increasingly questionable) I was seeking objective, usable, facts devoid of emotion in order to assist the decision process of when it will be a good time to buy again. I’m not interested in the opinions of people with an agenda twisting facts to rationalize their position. What’s the rush to buy RE in SD????. The interest on my former equity, now in the bank, pays the rent . . . . (I still hate renting . . . love it from a purely financial prespective, sucks from a lifestyle perspective). It would be great if more objective data where available. For example . . . some blogger should put together a site with 1) median price, 2) price per square foot, 3) inventory, 4) interest rates, 5) number of households in area, 6) homes sold, 6) broken into separate categories for condos and SFH and 7) median income all charted over at least the last 10 years (to extend beyond the last bubble in the early 1990’s. THAT . . . “my friend” as you so kindly put it would be useful and good information (I may even pay 4) upon which to influence a decision of whether it is a good time to buy or not. The blather of “phantom inventory” and similar ilk is nearly useless.
In search of a crystal ball . . . .
PS. The site I pulled was simply the result of cutting and pasteing one of the addresses from your post into Google which resulted in a broker site listing it for sale. Zip Realty, MLS, or not I didn’t check and don’t care. My point is that in the few seconds (cut, paste, click, read) I spent examing your claim of “phantom inventory” showed the property was on the market.
“objective, usable, facts
“objective, usable, facts devoid of emotion blah blah blah”
Seems to me like the “emotion” you speak of was sparked by the fact that your replies have largely been condescending and obnoxious. You asked for info, someone gave you info. If you don’t agree with that info, say “thanks” and move on or politely question it, instead of being combative, patronizing, and ungrateful.
What is it you are looking for, anyway? You have your precious inventory data. Most if not all of the laundry list of data you think “some blogger” should spend time obliging you with is available in the main articles of this site if you care to look around. All that’s left is to try to get behind the data and figure out what’s driving it, and where it may trend in the future. Attempts to do so have met with your dickish replies. If you just want hard data, go look it up and stop asking people to do your homework for you (and stop attacking people if they try to answer your questions).
I must be mistaken . . . I
I must be mistaken . . . I assumed the point of this blog was to get the real story and the real facts of the RE market . . . not the slanted take by the media and realtors. I AM VERY INTERESTED in real factual information which seems very hard to find these days. Ergo I am here . . . . If this is simply a forum express opinions about which way a financial market may or may not move . . . your right I should move on. As far as you doing “my homework.” The about link on this blog states the honorable goal of . . . .
The purpose of Professor Piggington’s Econo-Almanac for the Landed Poor is to provide in-depth, unbiased analysis of the Southern California housing market.
http://piggington.com/about
So yes I came here looking to stand on the shoulders of others who had ferreted out the useful information that seems to be missing everywhere else. Examining and questioning the assertions, not supported by data, of someone making claims one way or another is a good thing. Unless ingnorance is the objectgive. I was hoping the blog itself would be a consolidator of real “in depth” information saving me the time and hassel of doing the original research myself.
In search of a crystal ball . . . moving on to search somewhere else . . . .
Well, you’re probably gone
Well, you’re probably gone now, but with regard to facts, the listing you consider to still be on the market, 16612 Cimarron Crest, has been off the market since the beginning of September last year. It was listed on May 31 and de-listed 97 days later.
If you consider this listing to still be viable because you found it on a website somewhere (rather than an up-to-date MLS-based source), then I suggest to you that this would indeed be one of those “phantom” listings you’re arguing so hard against. So, as it turns out, you’re arguing with yourself.
Also, since you don’t seem
Also, since you don’t seem to have figured it out by now, ocrenter is a good guy and puts a ton of work into this stuff. One thing I’m sure of is that no one can give you all the things you’re asking for, but he’s one of the ones who tries to provide a lot of that data, so I don’t see the point in attacking him (assuming you really want what you’re asking for).
At this point whether or not
At this point whether or not the number of available listings is leveling off is just about irrelevant. The fact remains that most of the areas have a lot more sellers than buyers right now, and until the inventory burns off by at least half the prices aren’t going to do anything but continue downward.
The numbers of foreclosures and other must-sell inventory are climbing rapidly, and before too long that’s where all the action will be.
Think of it this way: if February 2007 had 1700+ sales and just under 1400 NODs it won’t be long before it just about doesn’t matter what the other 14,000 active listings do. The must-sell inventory WILL sell at whatever discount is necessary to prompt those buyers to pull the trigger.
Schizo,
Suggest you plot the
Schizo,
Suggest you plot the months of inventory rather than the actual inventory.
This is done by plotting inventory / monthly sales.
i.e. if there are only 10,000 houses for sale, and only 1,000 sold, you are in a worse “months of inventory” situation than if there are 20,000 houses for sale but 10,000 houses sold.
“Zip Realty, MLS, or not I
“Zip Realty, MLS, or not I didn’t check and don’t care. My point is that in the few seconds (cut, paste, click, read) I spent examing your claim of “phantom inventory” showed the property was on the market.”
that pretty much says it all about our schizo friend here, doesn’t it?