With summer right around the corner, buyers are wondering if we’ll see more homes for sale.
It doesn’t look like it.
We’re down to a five-month supply of detached homes for sale in the North San Diego County Coastal region (La Jolla to Carlsbad):
Active listings: 1,066
Solds this year: 1,035
Pend/Cont: 691
This graph shows how the new listings (in green) started dropping off early last year, and how unusual the gap is between new listings and closings (in purple) – about half of what it has been the last couple of years:
Normally, we’ll see a fairly steady supply of new listings through the summer, like we did in 2010.
But last year the new listings started drying up at the beginning of summer, and now in 2012 it looks like we’ve already begun to slow:
May New Listings:
2010: 514
2011: 556
2012: 321 so far
The closings have been very strong, but with fewer homes for sale, sales will either drop off, or the buyers will have to pick through the OPTs, probably with great reluctance.
So I figure what banks are thinking that if they hold on to their properties they will have less Short sales?
If the price of homes go up, say another 5%, how many fewer Short sales will there be? Another 10%?
It’s a scary thought.
If we see any more of this market euphoria (like in next week’s Case-Shiller report), it could change everything.
The over-encumbered will do more to hold on, thinking equity might only be a few months away!
I’d say with talk of a 5% to 10% appreciation, we’d see 50% fewer distressed sales. Strategic defaults must be 50% of the defaults now, and if there was hope, they’d make at least every other payment, just to see what happens.
But with Europe about to or already in a recession and now China going into a slowdown shouldn’t that also mean that there will be a contraction in the U.S. economy?
I already pulled my retirement accounts out of the market 2 weeks ago and glad I did. Grated I’m making 0.01% on my money, but at least I didn’t loose any (except to inflation).
And remember that taxes and healthcare are going up January 1st.
If you still have healthcare January 2nd count yourself one of the lucky ones.