Wednesday, October 10, 2007

Some September, 2007 Data

Insanely busy at work.

I recently received some data from a realtor acquaintance of mine. According to her, for SFRs in September, 2007:

Needless to say (so I'll say it anyway), a year ago and more the percentage of SFRs selling below the asking price was essentially 0%.

Marin Market Heat Index stuck at a pathetic 0.33.

Recall that the Index is interpreted as so:

9 Comments:

Blogger josh said...

Great stuff. As a spectator, I wish that data could be broken down by city and percentage below asking.

On the Heat Index, it looks like the components need to be adjusted for a new reality. According to the creator, Marin had a balanced market in 2003, 2005 and 2006. The only market that slightly favored sellers was 2004. Considering his career, a certain amount of bias is to be expected, but I can't imagine that 2005 was even close to being a balanced market in Marin.

Oct 11, 2007, 8:05:00 AM  
Blogger Lisa said...

Wow. Only 15% of listings went into escrow, if I read that data correctly.

There will be knife catchers, but I think for the majority of buyers 1) tighter lending standards are an issue and 2) fewer people WANT to pay these prices now that appreciation and the House ATM are off the table.

Seriously, why take on all that debt? Why have a mortgage that's nearly impossible to pay off? How do you ever retire??

Oct 11, 2007, 12:06:00 PM  
Blogger marinite2 said...

Wow. Only 15% of listings went into escrow, if I read that data correctly.

You are correct. 15%... pathetic.

Oct 11, 2007, 4:23:00 PM  
Blogger marinite2 said...

Just saw this over at Ben's blog:

California Association of Realtor chief economist Leslie Appleton-Young had a confession to make at the annual forecast lunch, or as she put it ‘an apology of sorts.’”

“Two years ago, amid a red-hot market, her forecast dismissed fears of a bursting California real estate bubble and called for only modest sales declines.”

“Two years later, the state’s seen a dramatic sales drop. In August 2005, the cyclical peak, sales ran at an annualized rate of 650,000 homes. By year end 2007, Appleton-Young foresees the sales rate under 300,000.”

“‘We’ve had a fundamental change in the mindset of the buyer,’ she says. ‘There is no reason (for a buyer) to act.’”

“‘This was more fun three years ago,’ Appleton-Young told the group as her forecast ended. ‘But we need to deal with reality.’”

Oct 11, 2007, 4:27:00 PM  
Blogger SEE YOU said...

POETIC JUSTICE!

Oct 11, 2007, 4:53:00 PM  
Blogger Lisa said...

“‘We’ve had a fundamental change in the mindset of the buyer,’ she says. ‘There is no reason (for a buyer) to act.’”

So, it's just a mindset issue on the part of buyers?? How about no one can get a suicide loan anymore? How about the days of proving you can actually afford the house are coming back? How about people don't want a huge stinking mortgage payment on a declining asset? How about people are finally realizing it's cheaper to rent, even taking the tax deductions into consideration.

Mindset, yeah right.

Oct 11, 2007, 5:16:00 PM  
Blogger SEE YOU said...

The SF Chronicle says it best http://tinyurl.com/2boa4u

Oct 11, 2007, 5:38:00 PM  
Blogger Matthew said...

I still consider Novato to be the bell weather market of things to come for the rest of Marin... just as the central valley is for coastal CA... the weakest fall first, but that soon spreads.. Novato's heat index is .16.. I don't think there is a proper definition for a market heat index at .16 other than locked and frozen.. I'd wager that all the sales have been distresses sales as well..

As Lisa has noted several times, the risk so far outweighs the potential reward in this market it's not even funny.. I cannot imagine the impetus for anyone to buy right now.. I'm also hearing less and less spin lately from the machine about tomorrow's prices..

4% decline in California for 2008?? I don't think so.. The CAR is off by a factor of 3 anyhow in that one.. We'll see another 10-15% drop.. just looking at the prices of existing homes today in Novato gives me a chuckle.. I don't think so and neither does the rest of the potential buyers which is why the index is at a paultry .16..

Oct 12, 2007, 1:10:00 PM  
Blogger Lisa said...

"Novato's heat index is .16.. I don't think there is a proper definition for a market heat index at .16 other than locked and frozen.. I'd wager that all the sales have been distresses sales as well.."

It's like a big game of musical chairs that suddenly froze up. Renters can't (or won't) buy. And without new money coming in, the chain freezes up.

I think a lot of folks are in for a very expensive lesson in market fundamentals 101.

Oct 12, 2007, 4:20:00 PM  

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