October 30 MLS Update

Three new listings in The Meadows in the past 48 hours. A home on Stonington for $360,000, 2,209 s.f. inside the Covenant. Another new listing on Sage Hill for $449,900 – $479,900, 2,973 s.f.; and finally a newer home (2006) with more than 4,000 s.f. out on North View Court for $1,475,000.

Lucky for me they came after my responsibility for running the Caravan was over –but we will certainly have a Caravan next Thursday.

 

Unfortunately, there were no Pendings or new Closed Escrow homes in the Meadows.

 

There was one price change in The Meadows (out of 16 in the Zip Code) – a home on Little Canyon Lane was reduced from $1,325,000 to a variable price from $1,179,000 to $1,269,000.

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October 28 Update on MLS (48 hours)

In the past 48 hours, there were 13 new listings in the Zip Code, and only one in the Meadows – but it is a retread. It is a 2 story home on Faircrest, 2,527 s.f. on 2.7 acres for $499,900 to $519,900. I know this property well, and this is a good price considering the land – and it has a detached separate garage and workshop in addition to the attached garage. This home needs updating, but the price is attractive.

There were seven price reductions in the Zip, but only one condo was reduced in the Meadows. It went from $174,500 to $159,000.

There were a total of 5 homes going into Pending, and 4 homes closing escrow in the Zip Code – but nothing in the Meadows.

The highest priced home that closed escrow was $410,000 – continuing the investment-level sales, but not much else.

My gut feeling is that the “regular” market will rebound beginning in March, 2009 if not before.

Money May Be Loosening

I can’t tell you the source, but I was on the phone today with a lawyer – it was a friendly, not a professional call – and he told me he had two interesting calls in the past several days.

He owns several properties, and he called a lender on one of them to obtain a $150,000 line of credit for a remodel. The lender offered him $300,000.

In another case he had a call from a well-known bank that has few toxic loans – they had been sitting on a request for a small loan against a multi-million piece of commercial property he owns. They offered him more than twice what he was seeking.

I can’t tell if this is a trend or even widespread, but it is interesting that apparently some of that federal money is arriving, or more likely knowing the alacrity with which government moves,) lenders are sufficiently sanguine about the money arriving that they are loosening the purse strings with existing money.

Some Good News

From the Financial Times:

Unexpected rise in new US home sales

By James Politi in Washington

Published: October 27 2008 16:25 | Last updated: October 27 2008 16:25

The pace of new home sales in the US rose by 2.7 per cent last month – a much better figure than forecast by economists – as low prices fostered a flurry of activity in the stricken US housing market amid an intensifying financial crisis.

New home sales rose to an annualised rate of 464,000 units after dropping by a steep 12.3 per cent in August, the US commerce department said on Monday. The inventory of unsold homes also dropped, from 11.4 months’ supply in August to 10.4 months’ supply last month. The median sale price for a new home fell to $218,400, its lowest level in four years.

But economists have cautioned that the stabilisation of home sales reflected buying conditions in July and August, and could be threatened by the deeper economic woes in late September and October.

October 26 MLS Update

In the past 48 hours, there have been eight new listings in the Zip Code, and only one in The Meadows and that is a re-listing of a home on Meadow Glen Way East, now for $399,000. My suspicion is that it has not sold because it is close to my home.

 

During that same two days, six cars in the Zip went into Pending, and nine homes closed escrow – no homes in The Meadows went into Pending or closed escrow. The most expensive of the homes that closed escrow was $417,000.

 

Still and investors’ market – and a pretty strong one at that.

Market Analysis

Now, the trigger of sub-prime loan has caused not just the credit crunch, but a national – and now an international – recession.

 

And all because egalitarianism demanded that people unqualified for loans be given loans, anyway.

 

If the recession becomes full-blown, that will exacerbate the housing problem, just as it was and is recovering. Last September the sales of homes in San Diego were 56% higher than September, 2007.

 

Given that, the housing market was well on its way to recovery, and indeed may still be, but the housing market needs the same ingredient  as ALL markets, and that is CONFIDENCE.

 

As the stock market is demonstrating, daily, there is a real lack of confidence in the general economy, but there are signs a lot closer than the stock market.

 

In my neighborhood, the demographics and psychographics are showing “signs.” Most of my neighborhood are retired, and they are sanguine about the economy, but the self-employed are showing some raggedness in confidence.

 

When the market goes south, the first thing that goes with it are self-employed housekeepers, painters, and carpet cleaners. Other self-employed, such as electricians and plumbers are more secure – when you need them, you will find the money.

 

But those homes where families own painting and carpet cleaning businesses are going up for sale — not short-sales and foreclosures — just precautionary sales. In other areas, real estate agent’s homes are listed, but in my neighborhood most of the agents are securely retired.

 

Unless we can generate some CONFIDENCE, that trend will continue.

 

Obviously, people make money in rising markets, and some make money in falling markets. The investors are making money today in the falling market housing by buying homes they can rent at the price of their mortgage payments, but few people have the finances for such high value investments.

 

Most people with discretionary income are simply awaiting the usual Christmas sales, which will come early and with even greater discounts. Those people will buy the products they had intended to buy anyway, for less money.

 

That helps the economy. It needs it. But housekeepers, carpet cleaners, and house painters will remain endangered because we can do without them as an economy — just not in my home.

 

My wife of 51 years would get rid of me before getting rid of our housekeeper!

 

Everyone has their priorities.

Bet You Didn’t Know

That well-known local watercolorist Pam Brasel teaches a local class in watercolors.