Crescent City/Del Norte County Real Estate Market Report - November 2010 is Slooooooowwww.
I'm really looking forwward to the day when I can say something encouraging for owner/seller's about our real estate market. It's still a buyers market with low interest rates, declining home prices and motivated seller's. It won't improve much for sellers until prices stabilize.
There were eight sales in our tiny market for the month of November. The median price, $120,000 with a long DOM (day on market) of 140 days. Four of the eight homes that sold were foreclosures, in fact the highest priced home to sell for the month at $243,000, was a foreclosure with an ocean view off Pebble Beach Drive.
The California Association of REALTOR's latest issue of Real Estate magazine has an article, "That was then, this is now," that has some interesting statistics and predictions for the coming year.
- Anxiety about jobs and a sharp drop iin home sales created fears of a double-dip recession by mid-2010...no double dip, however it may be too soon for a substantive economic recovery in 2011.
- Statewide unemployment averages 12.2% for the year...Unemployment should remain in double-digits until Q4 2012, according to a UCLA forecast...Del Norte County's unemployment is higher than the statewide average.
- Interest rates were at a low of 4.32% in September 2010...NAR's chief economist says mortgage rates could rise to 5.7% in 2011 and as high as 6.2% in 2012.
- 2010 was a banner year for buyers...not for sellers, though. 2011 will still be a buyers market for those with a stable job. Seller's will still face tough price competition from short sales and foreclosures.
- 2010 sales - 492,000 units...projected for 2011 - 502,000 units.
- Housing Affordability index 2010: 48%...46% for 2011.
- Any additional stimulus efforts, such as President Obama's $814 billion economic stimulus package will come under heavy scrutiny by Congress and taxpayers.
- Will state and federal tax credits come back? Unlikely...our country does not have the funding, however we spent 3 trillion in the last 2 days bailing out the Euro. Maybe we should all move to Europe.
- More than half of loan modifications done thus far have defaulted after the modification. Look for alternative to modification such as banks being encouraged by to "write down" the loan balance.
- The Dodd-Frank bill attempts to regulate banking and finance. Does anyone have any faith in our government to regulate anything at this point?
- According to CAR, Investors are driving the recovery and Del Norte County MLS stats bear that out.
- In 2010, sellers received an average of $35,000 on the sale of their home-a record low. This explains why the trade up market continues to languish (upper end home sales).
- 30% of sellers sold at a loss.
My personal experience, foreclosures are increasing in our market. At this time last year we had less than 20 REO/short sale listings and as of today we have more than 40, which is almost 20% of the listings. As long as short sales and foreclosures are a driving force in the market, prices will continue to decline increasing the risk of even more strapped homeowner's walking away (strategic foreclosure) from their homes.
Hang in for a bumpy 2011 and if you have money to invest in real estate, now is the time.
Thank you for stopping by. Your comments on this post are welcomed and appreciated.
No one sold more homes in Del Norte County in 2009, 2010 and 2011--*in units sold and volume--than Fran Gatti. Put Fran to work for you!
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*PER DNAOR-MLS
Your blog posts are so colorful, makes you want to read on, Thank you for the ideas and interesting stuff,
Mike,
Thank you. I sure do appreciate your kind comments.
"November 2010 is Slooooooowwww". That made me laugh out loud. Is that an official industry term? I kept waiting for:
"How slow is it!?"
"It is so slow that...."
Alex, why yes, that is an official industry term. I'm shocked you didn't know that :)
To answer how slow is it: It's so slow that only 8 homes sold out of approx. 280 active residential listings giving us an absorption rate of 3 years...yikes.