patrick.net

That explains the median rise. It has nothing to do with rising prices and all to do with the lower end dissapearing. Grim news for sellers.

median is always mathematically misleading.

what you have to do is watch the same or similar homes selling yoy - for example case shiller

That's unfortunately not necessarily correct. Yes, if more bigger expensive homes sell in better areas than the median price goes up even though no house itself increased in price. But to get a better idea where prices are going I always look at the average price per square foot, and that has unfortunately recently started to go up in SoCal. STUPID buyers don't care much about the purchase price, they ONLY look at the monthly payment and which is only going down with these always lower and lower interest rates. I wish interest rates would go up, really high, so everybody can buy a house for a reasonable price and not for these government manufactured high prices. Too bad a large percentage of the population sees rising home prices as something positive which makes me wonder why they don't like rising gas prices as well???

CashWillCrash says

That's unfortunately not necessarily correct.

We have gone over this 1000x. If one so-called listing sells or appears on the books to sell for 5M and the majority of the houses are 300K the mathematics is clear what that one sale does to a so-called average.

NONE of this crap can be trusted IMHO.

CashWillCrash says

But to get a better idea where prices are going I always look at the average price per square foot, and that has unfortunately recently started to go up in SoCal.

That's because housing closer into the city center is now outselling housing in the exurbs. Your typical city house built in the '30s or condo built in the '60s is going to be much smaller but cost much more in relation to proximity and Location, Location, Location.

CashWillCrash says

Too bad a large percentage of the population sees rising home prices as something positive which makes me wonder why they don't like rising gas prices as well?

The NAR and FIRE industry lobby politicians and launch PR campaigns so our (mis)leaders talk about "helping homeowners" by propping up prices and commercial newscasters parrot the "good news." It takes years for people to see through the scam, even longer if they think they're profiting from it. Look how long some of Bernie Madoff's "investors" got fooled, decades, until finally it collapsed.

Realtor: "Welcome to your cozy new 2 bedroom one bath 900 SQF home built in 1938. It has a new paint job."

Buyer: "900 SQF? It's a little small isn't it?"

Realtor: "Of course not. This is California living at it's best. The home is charming, cozy, energy efficient and environmentally friendly"

Buyer: "What do you mean energy efficient?"

Realtor: "It's built smaller so it uses less power. It's green"

Buyer: "You said this was built in 1938? It's 75 years old"?

Realtor: "Most houses in Los Angeles are. Think of it as a historical home"

Buyer: "Ok"

Realtor: "Deals like this don't come along everyday. We have lots of interest"

Buyer: "Ok"

Realtor" "The price is $313,000.00 firm. We won't accept any conditions because there are so many people interested in living in such a unique home. Are you interested?"

Buyer: "What's the monthly payment"?

Realtor" "Around $2000.00 per month. You can get a loan with 3% down"

Buyer: "Where can I sign"?

curious2 says

Look how long some of Bernie Madoff's "investors" got fooled, decades, until finally it collapsed.

Yes, wasn't that RICH!

War says

Michael Cooke says

Realtor" "The price is $313,000.00 firm. We won't accept any conditions because there are so many people interested in living in such a unique home. Are you interested?"

Buyer: I'll offer 40% of asking because that is all it's worth.

Firm?! LOL I'd only offer 50% of asking and if I heard "its FIRM" I'd have an x-rated remark for them.

Michael Cooke says

The home is charming, cozy, energy efficient and environmentally friendly"

You know that lingo translates into to me?

Charming = DUMP
Cozy = BOX
Energy efficient = WINDOWS THAT OPEN
Environmentally friendly = NO AC

The inventory of homes over $500,000 in OC has an average market time of nearly 4 months.

Under $500,000? razor thin 18 days.

Not a recovery.

Goran_K says

The inventory of homes over $500,000 in OC has an average market time of nearly 4 months.

Under $500,000? razor thin 18 days.

Not a recovery.

This is roughly the same thing going on in the Santa Clarita Valley (just north of LA) right now. Over 600k? It sits.... and sits.... Under 500k? Offers in the first few days. Under 425k? Multiple offers right out of the gate. Something is askew.

Jeremy says

This is roughly the same thing going on in the Santa Clarita Valley (just north of LA) right now. Over 600k? It sits.... and sits.... Under 500k? Offers in the first few days. Under 425k? Multiple offers right out of the gate. Something is askew.

FHA, private lenders making it hard to get financed over the conforming limit, but MOST of all, investor speculation.

A house under $500,000 has some room for rental profit (very slim IMO), but over $500,000, there is zero to negative profit in most cases.

A lot of speculators in today's market.

robertoaribas says

enjoy your smugness, I'll enjoy another month of making $5000 net off my real estate investments!

I don't believe this is true, because he's a Realtor. 8~)

robertoaribas says

enjoy your smugness,

I do because I don't owe a single mortgage on a depreciating asset.

Michael Cooke says

robertoaribas says

enjoy your smugness, I'll enjoy another month of making $5000 net off my real estate investments!

I don't believe this is true, because he's a Realtor. 8~)

I have said it before and I will say it again I know of no man who constantly brags about money or sex that actually has any.

robertoaribas says

I am a licensed Realtor

I'm a licensed driver.

I'm licensed to drive on roads and highways.

In other words there is nothing impressive about this. Anyone can be a Realtor.

Jeremy says

Something is askew.

It's called common sense to me.

robertoaribas says

Michael cooke:

Let's see, you come on a forum, and call me a liar without knowing me at all. you claim my real estate investment are all a lie... I post a link to ONE of my 13 investment properties, a home I bought for $42K 2 years ago, zillow estimates its worth at 100K. that is high, it would sell for around $80K today, and it is in fact rented for just under $900 a month. . If you were a man, and not a sniveling coward, you would begin apologizing now, but I see that you do not have that much character. How sad to be you!

Assuming your telling the truth I would rather be wrong 0.001% of the time than 99.99% of the time, Realtor.

The inventory is lower because I must be buying in bulk.

http://www.doctorhousingbubble.com/feudal-system-real-estate-wall-street-new-landlord-entry-level-buyers-bidding-wars-2012/

Full disclosure: we bought 6 months ago. But from what we saw when we were looking, the market seemed to be fairly hot but also fragmented as far as buyers go. The low end stuff- and of this low end, most of it was in less than super desirable areas- was being bought up by cash investors. On the other hand the semi- desirable to desirable areas of course had higher prices and thus were not as appealing to investors. So since non-investors were effectively locked out of the lower end market, that basically left the 450k+ market. Anything decent in decent areas that we looked had a lot of competition for homes in the 450-550k range. But these were decent homes. Houses that were crappy, weird, on strange lots, and otherwise priced too high for what the property was sat and sat.

From my observations the market has changed. We're not in a market decline. But the so-called recovery is extremely sluggish and highly reliant on ridiculously low interest rates. There is a lot of competition for decent stuff. So basically its not like the market is doomed doomed doomed. But its not going bonkers either. I've maintained I'd rather see a more tame market because that's better for buyers and sellers.

So since non-investors were effectively locked out of the lower end market, that basically left the 450k+ market.
I was just talking to someone yesterday who is in contract. This was their seventh offer. When they lost out on a property, it was to all cash offers.