A couple of days ago, a baby giant anteater was born at the Sacramento Zoo in Land Park. This was a first for the Sacramento Zoo. I was mesmerized by the photo of the giant anteater and thought about going over to the Zoo to see if I could snap a photo. But the infant is confined to close quarters in a den with its mother, Amber, so the best that I can do is give you that link where you can see the actual photo for yourself.
The baby giant anteater looks just like an alien. And you know I’ve seen my fair share of aliens. So, I know exactly what they look like. Just kidding, I have no idea what an alien looks like, but if aliens were to come to Earth, I bet they would resemble giant anteaters. Neither the Sacramento Zoo’s website nor the Sacramento Bee article disclosed the gender of this newborn giant anteater. I wonder why.
I was thinking about this as I showed homes in Land Park yesterday. Did you know that a mother anteater is pregnant for 180 days? That’s as long as a listing agreement. Well, I do take one-year listing agreements, but those are generally short sales. My regular contract period for a traditional sale is 6 months. Not that it takes me 6 months to sell homes in Land Park, but it could take 45 days to get an offer, depending on the price range, and another 45 days to close. I am required to get a listing extension if closing runs over that time period, so being the efficient person that I am, I make my listing agreement durations longer than necessary to avoid additional paperwork.
It was cold yesterday, too. And wet. My feet were freezing. It was my own fault for not wearing boots and choosing ballerina flats instead. Two of the homes I showed had no heat. So, while my buyers were wandering around in the back yard in the rain, I grabbed a cellphone call. Sometimes I look at my phone when it rings to see who is calling, but I was too cold to take it out of its holster; I answered the call on my Bluetooth Jawbone.
The caller was a home seller in Iowa. She had been doing research online and said every website she went to led her back to me. That’s the downside of enjoying a strong Internet presence. Strangers from all over the country call me. This woman could not sell her home. Buyers had been telling her over and over that although they liked the home, the bedrooms were too small. What could she do to sell it?
I tried to explain that homes with undesirable features tend to sell for less than desirable homes. I asked her to think about why she bought the home in the first place because, whatever the reason, that’s why a buyer will purchase it now. I suggested she lower the price.
Turns out she built the home. Well, lady, I hate to say this, but you built your bedrooms too small.
Photo: Big Stock Photo
—
Elizabeth Weintraub is an author, home buying columnist for The New York Times-owned About.com, a Land Park resident, and a Land Park real estate agent who specializes in older, classic homes in Land Park, Curtis Park, Midtown and East Sacramento. Weintraub is also a Sacramento Short Sale agent who lists and successfully sells short sales throughout Sacramento. Call Elizabeth Weintraub at 916.233.6759. Put 35 years of real estate experience to work for you. DRE License # 00697006.
The Short Sale Savior, by Elizabeth Weintraub, available through bookstores everywhere and at Amazon.com.
Photo: Unless otherwise noted in this blog, the photo is copyrighted by Big Stock Photo and used with permission.
The views expressed herein are Weintraub’s personal views and do not reflect the views of Lyon Real Estate.
Related posts:
- How to Get an Edge Buying a Home in Land Park One of the many reasons that buyers for homes in Land Park like to work with a Land Park agent…
- The Best Day to Buy a Home is Just Around the Corner I was amazed yesterday when I called 2 agents on 2 listings and both agents answered their cell phones. Christmas…
- Be Prepared Before Putting Your Home on the Market in Land Park The year of 2010 is starting out very busy. I thought this weekend would be fairly quiet, but I guess…
HS
Greg Fielding
Jared Higgins
Terri Tucker
Lori Mode
Doug Reynolds
Andrew Jeffery
sallyjc
missycaulk
kareneldred
Laura Lazar Kearns - 
Kristal Kraft
Terry Osburn
james bunyon
Dave Wierzbicki
No BS Real Estate Indicators – January 2010
Mar 11
Posted by HS in Uncategorized | No Comments
No BS Real Estate Indicators and Commentary – January 2010
The media said 2009 ended like a lamb. The data was contradictory to that opinion.
December was a good month. The media is also saying 2010 started like a lamb. On this one, they are relatively correct. Sales indeed showed a sharp decline in January (Sacramento single family homes; see Indicator #1 below). As of right now, they are even lower in February. Since March 2008, the number of closed sales has been consistenly over 1400 per month.
The supply is limited to contingent short sales and REO fixers. This is how booms start though. Everything is quiet in the eye of the storm. Spring has sprung and buyers are awakening. If you are thinking of selling, get it on the market soon. Call me for help. If you are buying, yes, I can help you too.
The charts below reflect over 10 years of local data collection, charting and trending. The commentary is relevant to this information and what the author sees in the trenches. No single piece of data can tell the whole story nor do these specific indicators predict the future. Remember, the “momentum” of a trend is important in understanding the force and direction of an underlying data element. A commodity trader watches momentum indicators to more accurately (but still with no guarantees) foretell a future data point. These are million-dollar decisions so momentum is important.
The charting doesn’t end here. Over 10 years of median sales price data has been collected and charted for over 40 local zip codes (see my Communities web page coming soon). As you know, real estate is local and it’s hard to find data more granular than a zip code.
Major Indicator #1 – Sales
Since April 2008 the momentum of Sales has been positive. In January it crossed back into negative territory. This would trigger a “SELL” action when a price is being charted. In the case of this data element, it depicts the typical valley that “should” occur in a real estate cycle. You can see the “winter dip” occur between December and February each year. But things are thawing and bears are hungry.
Opinion: Look for sales to decrease in February and then increase moderately through the spring and summer. Nobody is sure what the rules will be and my bet is that Congress (should be written with a small “c” in Crayon font) will extend the tax credit for buyers, in some shape or form. There are always hungry bears.
Major Indicator #2 – REO Sales
These are also known as “bank-owned” and “foreclosed” properties. When auction demands are not met when offered on the courthouse steps, these homes revert to the owning/servicing bank to sell on the open market. These have always occurred but not in the numbers we have seen since 2006.
Since July 2009, REO sales have been less than half the number of Sales. The winter and spring before that, REOs were over 70% of the sales volume. Banks are simply not foreclosing. Whether due to accounting practices or “deer in the headlights” syndrome, the movement of product through the pipeline has stalled. Now the supply is low except for contingent short sales. And those can be a waste of time. The momentum is negative. We hope the REO Sales momentum increases — it would signify the availability of supply.
Opinion: Look for REO sales to stay low until the banks understand the new rules. And then can understand the coming changes to those new rules.
Major Indicator #3a – Median Sales Price (Sac Cnty)
The median price for all of Sacramento County has shown a slight improvement — but now retreating to the Summer 2001 price levels. Momentum is serious about getting back to positive territory.
Opinion: The area price will decrease slightly while some high-priced areas/zipcodes will see a material reduction in comparable sales.
Major Indicator #3b – Median Sales Price (ED Cnty)
The choppiness of this El Dorado County chart really just signifies the variation of homes, prices, and supply of sales comparables. Even the momentum cannot decide which direction to go.
Opinion: This general price will decrease slightly due to the high-end which will experience most of the impact in 2010.
Major Indicator #3c – Median Sales Price (PL Cnty)
The slide of prices in Placer has been slower and smoother. There also may be some corrupting forces at the County and City levels which we don’t see. For some, the local pride is too sensitive and they won’t accept their just deserts. Much of Whitney Ranch is entering the “short sale” zone. This will help supply for some.
Opinion: The price here will also decline to the squeeze at the higher end of home prices.
Major Indicator #3 – Median Sales Price (All)
This chart shows the comparison of the 3 counties. It doesn’t include the momentum indicators but it’s interesting to see the responsiveness of Sacramento’s price changes compared to the other 2 counties.
Major Indicator #4 – Notices of Default (NODs)
Notices of Default have hit a major stoppage in the pipeline. The indicator that is missing is “borrowers in distress”. That would be a difficult piece of information to collect.
Opinion: The number of NODs will increase as will Auctions and foreclosures.
Major Indicator #5 – New Home Permits
If they are still building, the homes are smaller and more sensibly designed. Gone (temporarily?) are the massive walk-in closets and master bathrooms. Gone are the 4-car garages and bonus rooms. We have entered and exited the “McMansion Era”. Some builders died before they could exit.
Opinion: Population increases generally require more housing. It only seems we have enough.
Major Indicator #6 – Mortgage Rate
Free money!!! If you can get a loan, don’t miss this window of opportunity. But rules have changed so you better know your buying power and options.
Opinion: Rates will increase slightly over the year although other lending restrictions will corrupt the market making the rate change less important. This cannot last for much longer. China will inevitably call us on it.
Major Indicator #7 – Inventory
I’ve added another piece of information to this chart: “Active Short Contingent” properties are akin to a Pending status with regard to how Realtors treat them. If it’s “contingent”, Realtors and buyers know the home has a soft deal with a prospective purchaser. I think MetroList should make it a “Pending Contingent” status. It will make the numbers stop lying.
Opinion: Inventory will increase but so will Active Short Contingent listings. So who knows!
Major Indicator #8 – Months’ Inventory
The Inventory is over-stated so the true turn-over rate (Months’ Inventory) is a little different than depicted below. Since this depicts the months required to sell all inventory (at the average Days on Market), this too is over-stated. Mitigating that variance is the fact that many of these “active” listings are actually “pending contingent” and can remain on the market for many months without a bank approval or change in status. In other words, this indicator is low but not necessarily 3.3 months.
Opinion: See opinion on “7 – Inventory” above.
Major Indicator #9 – Short Sales
This is a new indicator showing how many Short Sales were successfully closed. The momentum cannot be charted until at least 12 months of raw data have been collected.
Opinion: This number will stay relatively flat, with a slight increase. Many banks have already concluded they will not entertain short sale offers. Some borrowers purchased mortgage insurance with their loans which means the lender doesn’t care if they foreclose (insurance pays them about 80% of loan value).
Major Indicator #10 – Swing Indicator
This is my favorite indicator since it shows the oscillation of the market — much like a EKG machine. Let’s hope the market doesn’t flatline. Except for January ‘09, Up-Ticks outpaced Down-Ticks. For this last month, 41 zipcodes had a momentum up-tick.
Opinion: The up-ticks will retreat to a lower level. This is a cycle that we cannot and should not fight.
These charts depict the momentum of changes in the underlying raw data to help forecast direction. These are not a guarantee of future direction but aid in the prediction of cause/affect in the various market forces. No single indicator tells the whole story. Also charted is the raw data itself. For an explanation or for a monthly subscription to this periodic report, call or email Jay Emerson (916-517-9606, Jay@JayEmerson.com). The data is deemed reliable but not guaranteed. Sources include DataQuick, CBIA, Sac MetroList, and other public information.
Contact me for more details and to get an edge in real estate!
Jay Emerson, DRE Broker #01788488
Realty Executives Galster Group
5006 Sunrise Blvd, Ste 202
Fair Oaks, CA 95628
(916) 517-9606
Fax (916) 966-8706
Related posts:
Tags: As Goes California…, commentary, data, Data, Data, and More Data, El Dorado, Existing Home Sales, First-Time Home Buyers, Home Economics, Home Prices, indicators, momentum, Real Estate, Retail Sales, Sacramento, Short Sales, The Buying and Selling Process