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An Insider's Guide to North San Diego County's Coastal Real Estate
Jim Klinge, broker-associate
858-997-3801
klingerealty@gmail.com
Compass
617 Saxony Place, Suite 101
Encinitas, CA 92024
Klinge Realty
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Jim Klinge
Cell/Text: (858) 997-3801
klingerealty@gmail.com
701 Palomar Airport Road, Suite 300
Carlsbad, CA 92011


Posted by on Nov 18, 2009 in Housing Tax Credit, Market Conditions, Thinking of Buying? | 21 comments | Print Print

Tricklin’ Down

Speaking of contests, we have a pair of Chargers playoff tickets riding on the amount of homes for sale on December 1st.

In December, 2008 the average amount of homes for sale was 15,116.

On August 11, 2009, the total amount of active listings was 11,457.

On September 22, 2009, the amount of actives was  8,149

Today’s inventory count is 7,955.

Here are the guesses:

http://www.bubbleinfo.com/2009/08/16/chargers-contest-review/#comments

CA renter is the front-runner currently, with three weeks to go!

The lower inventory counts are excruciating for the ready, willing, and able buyers. Any decent houses that list with an attractive price are still being scooped up quick.

**********************************************

The pending count has held up, but will we see a load of closings this month of those getting in before the previous tax-credit expired?

September 22: 11,011

November 18: 10,528

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How about the REO counts, any flood happening yet?

Week New REO listings
Oct 1-7
184
Oct 8-14
193
Oct 15-21
200
Oct 22-28
217
Oct 29-4
205
Nov 5-11
202

No flooding sighted, but steady flow for now.

What would happen if buyers take the holidays off, come back after the Super Bowl all fired up about getting a tax credit, and there’s not much to buy? Hopefully we’ll be able to count on some of the 10,580 properties on the trustee-sale auction list to make it to market!

21 Comments

  1. Today’s count is almost half of the 2008 December market?!?! Yes, the lower inventory is excruciating to us buyers; but trying to find the “right” house is like searching for a needle in a haystack.

  2. I suspect that ultimately the houses being scooped up by investors will be re-available with improvements at near the same prices.

  3. wow only one serious bet under 8000, and yet that’s where it is.

  4. cara-I believe when I voted, I voted one below the lowest number at the time, but then a bunch of people went below me, although it looks like the real number will be very low indeed.

  5. I gave up looking for a house a while ago. There’s too much manipulation going on right now.

    If gov would have let banks fail they would have been forced to liquidate RE assets. Consequently home prices would be much lower.

  6. Right there with you shadash.

    Too big to fail is the sham of the century.

  7. I was expecting a lot of closing in Nov 09 when the tax credit was still going to expire, but with the extension maybe some marginal buyers will drop out of escrow thinking they can wait for something better.

    If you look at the old Credit Suiess chart of subprime and option ARM resets this was suppose to be the lull, mid 2009 was expected to be somewhat slow for resets and recasts. Option ARM and Alt A resets/recasts weren’t suppose to happen until 2010 and 2011. We’ve seen a lot of assumptions that these people already defaulted, but nobody knows for sure.

    At this point I think we have to say that government intervention succeeded in the goal of stabilizing the market and reducing inventory, but when are the unintended consequences going to show up. Are we going to be staring at a market in July 2010 without government stimulus that manages to stand on it’s own feet or one that starts another wave of collapse.

    Will we ever see a housing market again without easy cheap money loans Subprime -> Option ARM/Interest Only/Neg AM -> FHA/Tax credit 0 down -> What’s the next easy money loan to keep the market going.

  8. Of course if the banks that are in trouble all failed, thousands of businesses who depended on those banks for lines of credit would also fail, millions would be out of work, and the second Great Depression would have occurred, instead of “merely” the worst recession since the first Great Depression. Hence the TARP nonsense, which was the least worst choice.

  9. Geotpf,

    Risk is a double edged sword providing both rewards and losses.

    If you take the losses away (as programs like tarp have done) those who take risks with just take bigger risks ignoring the possibility of potential losses.

    Doesn’t it bother you at that banks needed your tax dollars to stay in business because they run their businesses so poorly? Does it bother you that banks are using your tax dollars to make profits for themselves?

    I promise you if banks started failing there would be people looking to start new banks in the failed banks wake.

  10. All TARP did was guarantee that we will have the same problem again sometime down the road. A business failing doesn’t signify the death of an industry. Maybe I heard incorrectly, but it was my understanding that Wells and ING came through relatively unscathed.

    Last I checked, millions are out of work.

    Btw, that inventory count really caught me off guard. I’m assuming the majority of that is withdrawn listings?

  11. If the Goverment did not allow the banks to extend the HAMP three month trail to five or more months the spigot would be dripping REO’s alot faster by now.

  12. JTR, where are you getting your current inventory number from? housingtracker.net shows 11,789 as of 11-16. sdlookup.com is showing 12,217 currently.

    Are you counting houses and condos?

    Perhaps you are excluding contingent listings but then I don’t see why there was a drop from 11,457 in August to 8,149 in September.

  13. JtR does not count contingent as current inventory. That’s because you can’t go make an offer on the house right now. I agree with this tactic because how many people are touring contingent houses and making offers on them?

  14. Throw out the non-contingent short sales and you have NO INVENTORY in some areas!!!

  15. wow – 79 legitimate guesses with a spread of over 10,000 units, and a good chance the real number STILL falls on the low side?

    And this was 3 months ago – govt manipulation hasnt changed, extend and pretend hasnt changed, nothing has changed, and yet, the group still couldnt come up with a realistic prediction.

    Just goes to show how far the expectations of the bloggers here are detatched from reality…

  16. I don’t like the TARP at all. I like 30% unemployment less. I didn’t say the TARP was a good choice; I said it was the least worst choice.

  17. i think the largest assumption in this article is the Chargers making the playoffs! (=

  18. Geotpf,

    Like shadash mentioned above, there is a lot of money out there desperately looking for good investments. If the banks were allowed to fail (while depositors were protected via FDIC), others would have taken their place. The added benefit would be the re-pricing of risk. Interest rates would be higher, and people would be more cautious about borrowing and lending.

    What we saw during the credit bubble (which includes our current market, BTW) is NOT good for our economy nor for our society. Low interest rates and easy money might keep unemployment numbers lower than they might be otherwise, but they lead to even bigger problems down the road.

    The “Greatest Depression” has not been averted, it’s only been delayed.

  19. “NOT good for our economy nor for our society.”

    Ca renter – thats debatable isnt it. The masters of the universe decided we were looking at a potential deflationary feedback loop. If it were true, we would not have “creative destruction” via the levers of supply and demand but just “destruction” as people in all sectors did the rational thing and held out for lower and lower prices (ignoring the fact their personal balance sheets were getting lower and lower due to others doing the same thing).

    Not only is mere “destruction” not a societal good, it carries with it the potential for tremendous instability. Can you imagine what would be the popular response if the govt merely sat back and said “we wont intervene, long term it is good for you”???

    That type of response is a recipe for revolution. Dont think it cant happen here? The US is less than 300 years old. Empires that lasted thousands of years longer than or grand experiment are long gone. If they could go the way of the dinosaur, so could we.

    The argument for the lost decade a la japan is that it allows society to adjust, slowly to the inevitable. There is no revolution in japan because younger generations grow up in the system and thats all they know. They dont remember the good old days, nor do they expect them.

    It was a faustian bargain indeed. Rip the band aid off at risk to your survival, or ease the pressure out slowly over time.

    Not saying they made the right choice, nor am I saying that revolution was even a likelyhood, but thats the argument.

  20. Yes, that’s the argument used to convince the PTB to destroy our country via inflation.

    You can’t have asset inflation and wage deflation at the same time without causing tremendous social and economic dislocations. By trying to artificially prop up asset prices (while not addressing the multi-decade wage stagnation/deflation), they are forcing Americans into poverty even faster than they would with deflation. As it is going now, we are losing purchasing power by the day. This is the worst of all possible outcomes, IMHO.

  21. “This is the worst of all possible outcomes, IMHO.”

    Worse than the dissolution of the USA via social unrest? To me, thats a worse possible outcome – but I guess we’ll just have to agree to disagree.

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