MANHATTAN BEACH (CBSLA.com) — According to real-estate website Trulia’s first-quarter “Bubble Watch,” the top two overvalued housing markets in the country are Orange and L.A. counties.
Climbing prices, combined with low inventory, is causing worry for some would-be home buyers, concerned about the possibility of another bubble.
Danielle and Robert Merrill told CBS2?s Serene Branson they have put in offers on 10 homes in the past five months, from Mar Vista to Santa Monica, but lost out on them all.
“It feels like it’s climbing at an unbelievable rate and it seems that prices have really jumped way up,” Danielle said. “It’s emotional. Every time a property comes on, and with this market you jump on the day it comes on the market.”
“It’s been a difficult process because the inventory is so low prices are just going up and up and up,” Robert said.
According to the California Association of Realtors, the median home price in L.A. County was $390,000 for February 2014 – up 15.2 percent from the same period last year.
In Orange County, the median home price last month was $677,000, up 11.6 percent.
The numbers show affordability has also dropped.
Only 30 percent of L.A. County residents can afford a median price home, down from 44 percent last year. In Orange County, it’s down to 20 percent from 34.
Real-estate agent Jeremy Shelton, of Shorewood Realtors, pointed to a three-bedroom Manhattan Beach home that sold over the asking price.
“Inventory is tragically low,” he said. “This came on a week-and-a-half ago. We had three offers right off the bat.”
Shelton said it’s a seller’s market, and he predicts modest increases before prices level off.
“Much like 2006, 2007, we have limited inventory. Prices are therefore going higher. There are a lot of qualified buyers, which is the key in the market now – unlike we had in 2007. So yeah, we are seeing a frenzy,” he said.
It’s a tough reality for buyers like the Merrills, who have been beat by so many all-cash, no contingency offers they’re taking a break before jumping back in.
“We’ve been through such an emotional ride with the market not knowing where it’s going to go from here,” Danielle said.
“Much like 2006, 2007, we have limited inventory”
Inventory was peaking then.
Agents are a little vague on their real estate history.
They could get by with one line as a catch all:
“Like last time”
Too much emotion, not enough logic — the stuff bubbles are made of.
Recovery/Bubble/whatever seems quite uneven.
Inland areas seem to have quite a ways to go before they get back to peak pricing.
which makes me think this has a ways to go yet.
I’m writing this from the Tokyo airport after visiting Singapore. I used to not believe it when people said that Asians are buying up houses around California as investments or places just to park money. Now that I’ve been out here I know that it’s true. It’s amazing how well off people are out here.
Visit while you can. The way the fed is printing money we’re not going to have favorable exchange rates in the future.
New Case: No liability for listing broker’s accurate and true MLS Statement. However, buyer’s broker’s advice to client to “check [the report] out” is insufficient to avoid liability.
This case involved the sale of a vacant property in an earthquake zone. The seller’s broker stated in the MLS “This parcel is in an earthquake study zone but has had a Fault Hazard Investigation completed and has been declared buildable by the investigating licensed geologist. Report available for serious buyers.” All of which was true. The problem, however, was that the report was from 1982 and in the interim were the Loma Prieta and Northridge earthquakes; much had changed in the building standards from then to the sale of the property in 2006. After closing, the buyer found that he could not build. He sued his broker, the seller and the seller’s broker, alleging that omitting the date of the report was a misrepresentation. The trial court found the buyer’s broker liable for breaching the fiduciary duty to the buyer. The seller and the seller’s broker where held not liable.
Buyer appealed only as to the seller’s broker. Following prior case law, the court found that, while a real estate broker owes their own client a fiduciary duty, they owe third parties who are not their clients only those duties imposed by regulatory statutes. These duties include honesty, fairness and full disclosure as well as the Civil Code section 1088 responsibility for the truthfulness of statements in the MLS. The court found that the statement was in fact true. There was a report. The geologist did find the parcel buildable. And the fact that the MLS did not state that the report was from 1982 was cured by the report’s availability, especially so when the report was dated May 20, 1982 on its face. The court held that the seller’s broker had met the requirements of honesty, fairness, and full disclosure.
The buyer’s broker, however, did not fare so well. The buyer’s broker merely gave the buyer a copy of the report, telling the buyer to “check it out.” The court states that the buyer’s alleged injury arises from the failure to investigate and understand the implication of the information that the report dated to 1982, a failure that the trial court found was the buyer’s broker’s responsibility, and not from the failure of the seller’s broker to provide information. Certainly something beyond “check it out” was required of the buyer’s broker. Saffie v. Schmeling, filed March 7, 2014, Fourth District, Div. Two, 2014 S.O.S. E055716 http://www.metnews.com/sos.cgi?0314//E055716
The fed is not the only one printing Money LOL
What you are seeing mostly is Asia Housing bubble money.
He who can keep his bubble from deflating Wins.
Well it looks that way so far anyway.
Did they plead fraud in the inducement?
@JiJi For homes in good condition, we are up to 2004 pricing in San Bernardino county, one of the worst boom/bust areas. Junk houses in the hood aren’t selling for their 2004 frenzy prices…yet.
“we are up to 2004 pricing in San Bernardino county”
Nominal or inflation adjusted? Big difference.