Pasadena CA Real Estate, A Look at the First 6 Months

Now that 2009 is half over I think we can probably all agree on one thing with respect to the housing market…..that was a quick 6 months. As far as the results we have experienced thus far, what are your opinions? Did you think the market would be more active, less active? What about prices, did you think they would be lower, higher, and where do you think they are headed. Also what is your opinion on interest rates, will they be going up in the second half of this year or remain steady?

In terms of my opinion, I think we are fortunate to have the housing market we have considering the tremendous amount of external pressure being exerted on real estate. The economy, unemployment, foreclosures, the California budget deficit and declining consumer optimism don’t seem to be a factor in the Pasadena real estate market. Our local market, despite all of these negative issues hasn’t seemed to affected by the outside forces which will usually have an impact on the housing market.

4 Key Measurement’s Affecting Housing

Enclosed are 4 individual charts which are critical barometers of the housing market. Collectively they offer an overview of where the market is and where it might be headed.

1. The Number of Properties Sold by Month – We are dealing with two separate issues here, one was the beginning of the real estate decline and then more recently the crumbling economy. The fact that the number of home sales has been growing each month is cause for optimism, despite the poor economic performance.
2. The Number of Properties Under Contract – the June number represents
   

   The median price of a Single Family has been increasing

   some of the strongest data in two years, however part of this could be due to the lengthening escrow process associated with short sales and the typical 60+ day turnaround time for banks to provide authorization. We are seeing very high numbers of preforeclosure sales, and longer escrow periods and how the listing is classified push the measurement much higher.
3. Average Days on Market – I just wrote a detailed post about the “Days on Market” measurement and how this can be manipulated over at the Pasadena Real Estate Guide. Again, I would have to impart some of the responsibility for this growing number to the current distressed market and short sale properties and I don’t think this reflects the current activity whatsoever.
4. Median Sold Price by Month – the unique thing about this two year graph is the data is defined by a trend line. You do not see a lot of peaks and valleys, as it is well defined in one direction. I do believe that much of the buyer hesitation we have witnessed over the last 12 months is beginning to dissipate and home buyers in all price ranges are starting to return, which should keep moving the median price line in an upwardly right direction.

In the next 6 month period (July – December) look for home sales to continue to increase as well as the median price to slowly move up. Right now the big variable is the pending foreclosure inventory which appears to be growing, but by many accounts remains off market. While I think the market is recovering, I believe with the current economic situation has brought on a tenuous recovery.