Confusing Housing Picture

The report on housing in the North County Times yesterday was instructive, right from the pull-quote: “It’s very hard to make sense of all this. It’s a crazy market” – a quote by a real estate economist G.U. Krueger.

The article has some interesting information: The banks are continuing to decrease foreclosures, and instead increase short-sales. This has several impacts – it does reduce neighborhood blight by keeping homes occupied, and it marginally protects the price decreases from plummeting, but it is a stop-gap action.

Non-distressed home sales (regular sales) must still compete with distressed home sales, and that still does not help the usual Seller – and the usual Seller is still a non-distressed Seller.

Lenders first send out Letters of Default to Sellers who are behind in their mortgages, and those letters have dropped in numbers for the 17th consecutive month in San Diego and Riverside Counties, as lenders reduce their foreclosures. In San Diego North County, the rate of defaults fell just this past month to a rate of 1.7 per 1,000 residences – a 26% reduction from March.. (In Southwest Riverside County their rate was 3.8 notices of default per 1,000 residences.)

In Riverside County, 54% of the homeowners are “under water” while in San Diego County only 34% are.

The good news is that in San Diego County, the median priced home rose to $452,000 (up 9% from February), but without any explanation I suspect that is an anomaly. The Riverside County median price went down.

It is too confusing a picture to make any sense of.

One Response

  1. […] Confusing Housing Picture Posted on May 12, 2011 by usna1957 | Edit […]

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