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Pasadena Home Sales in December, Not So Joyous

January 14, 2009 By 1 Comment

Retail sales for the month of December were released today. Year on year sales indicated a decline of 9.8%. A 10% decline in the price of Pasadena homes would be welcome news. Actually a 15% decline would be nice to see. Isn’t December supposed to be the most wonderful time of the year?

Other than sharing a name and a freeway, the Cities Pasadena are the antithesis of each other at least in terms of home prices. The South Pasadena real estate market can sell fewer homes and maintain an increase. On the other hand, Pasadena sells nearly twice the number of single family homes and prices fall $200,000 or 27%.

Pasadena Single Family Home Sales

The road to recovery begins with an increasing number of homes being sold. This is happening at least in the single family category and a positive sign. The housing market has been similar to a car wreck. You take an immediate inventory of your senses to see if you are okay to continue driving. Most people are moving past the housing freefall. Lower interest rates are getting people back in the car.

We are beginning to see some evidence that selling times are slowly decreasing. Inventory currently stands at about a 5 month supply, again a sign of normalcy returning. If only we could find any positive proof that prices would begin to stabilize. I actually thought the December median price would be closer to $515,000. Looking at January, it appears that the median price could fall to $460,000 based upon the median price of homes currently in escrow.

Pasadena Townhomes and Condominiums

If you are a Buyer in this market you have a tremendous amount of leverage. Property owners have got to be desperate for an offer. If this were horse racing, bet the trifecta, prices are down, the number of sold units is down and selling times are up, way up. I think homebuyers are making their choice very clear, a single family residence offers a much better value in today’s market than a condominium or townhome.

Pasadena Real Estate Outlook

I am polishing the crystal ball with another coat of Windex this month. At the beginning of 2008, the number of homes that were sold were at some of their lowest levels in years. Look for sold units to double at a minimum. Prices will continue to drop compared to the previous 12 months, however we will begin to see more consistent median prices on a month to month basis.

In any market one of the great unknowns is consumer sentiment, and how do consumers feel about investing in the economy and spending money. Lets home the new administration begins with an increased consumer confidence. After all, if you believe it you can see it.

Pasadena Homes Dec08 Sales Report
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Pasadena Home Sales up2date Review

October 10, 2008 By 1 Comment

I have prepared my elevator speech for the Pasadena housing market….”consistent”. There you have it, nothing fancy, and nothing dramatic, just a quick conveyance of an idea that succinctly sums up Pasadena home sales for the month of September. Consistent was derived by looking at the median price decline for the month, which just happens to be the same decline as we had in August.

Again, rather than insert a matrix of numbers and try to explain each segment of our real estate market you will recognize the graphic at the end of the paragraphs. All of the market data is now put into a PowerPoint presentation and delivered via a slideshow. To me, the synopsis is much easier to read and therefore easier to understand.

Allow me to elaborate on a couple of the highlights in September. Inventory (meaning homes and condos available for sale) is beginning to decline. The main emphasis for this has to do with seasonal occurrences rather than increasing home sales. We are not however seeing the monthly volume swings that we used to experience when the market was much more active. In last month’s report I had suggested that we would see a big increase in the number of homes (units) that were sold. We did, by almost a 3:2 ratio. That could easily continue for the next several months. The reason is that in the 4th quarter of 2007, home sales fell off the radar screen, so today’s increase is against last years poor performance. Units will increase, however the same will not be applicable to prices. October and November’s median price last year was $655,000 and $654,000 respectively. That elevator has a way’s to go before we see those kinds of prices again.

However the long journey begins with a short step!

Pasadena Homes Sept08 Sales Report
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Pasadena Homes – Sales Report by Month

Pasadena CA Real Estate August Sales Report

Pasadena Real Estate July Sales Report

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Upcoming Pasadena Home Sales, A False Positive?

July 24, 2008 By 2 Comments
Pasadena Ca Housing Stats

Pasadena home sales for the month of July are still about 3-4 weeks away from being released on a national level. Expect a reversal in the continuing bad news that has plagued the housing market for the last year. Why the change? Is it from the expected passage of the Positive test
Housing Bill making its way through Congress? Have the number of foreclosed homes finally reached their peak and now are beginning to level off? Have home buyer’s come to recognize that the bottom is soon approaching and pent up demand will drive the market higher? Or have consumers just been inundated to death by articles and advertising campaigns stating that “now is a great time to buy a house” and it is finally beginning to pay off?

The answer is ….probably not

It would be great news and also provide a much needed boost to the housing sector if we could pinpoint the expected July turnaround to the proactive position taken by consumers and to a lesser extent, government intervention. But the underlying reason of the better news can only be attributed to one thing, and that is…. time.

It was July 2007, when we noticed a substantial drop in home sales activity. Although projected home sales for the month of July 2008 will be predictably in line with what we have seen so far this year, when compared against last year it will appear that the housing market has began to steady itself and that the worst news is now behind us. The outlook for the remainder of 2008 also appears to be favorable based upon the recorded home sales in the back half of ’07. While the next few months may begin to appear more positive, its not much to get excited about. But then again it will be portrayed as a sign that the market is on track and that in itself will allay consumer skepticism. The perception will be perceived as a return to normalcy and as we all know, perception is reality, when in fact you know it as a false positive.

Pasadena Real Estate July 08

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Pasadena CA Homes for Sale & Interest_ing Rates

June 24, 2008 By 1 Comment
mortgage rates

When you hear the word “sensitive” the Pasadena real estate market is probably not the first thing that springs to mind. That being said, we are probably in the midst of the most sensitive housing market in years. Volatility will continue to reign, until time has a chance to cure the current ills.

If you are looking to buy a property, there is no more important factor than your interest rate. mortgage rates
It can make or break your deal. A slight change can end up costing you hundreds if not thousands of dollars over the life of your loan. The most closely watched barometer of the housing market, followed intently by home buyers and all but ignored by home sellers.

Why?

Because homes are priced based on comparative sales in the neighborhood with very little thought to economic conditions, with one exception as we will discuss in a following paragraph. On the other hand homes are purchased based upon affordability and qualification. Two factors that have maligned the mortgage industry of late, since borrowers are now being asked to document the file and prove their income.

The following graphs reflect the current status of the Pasadena California real estate market for single family homes as of last Friday, June 20.

Interest Rate Increase, Home Sales Decrease

Even though loan qualification is a much more stringent process these days, interest rates remain historically low. However when interest rates begin to rise what impact does this produce on home sales? July Inventory

As you can see from the graph provided by Bankrate, over the last two and a half months interest have been steadily on the increase. Home buyers begin to recognize this and see the monthly mortgage payment consume more of the monthly budget. Instead of rushing out to lock in a loan, they choose to take a “wait and see” approach, in hopes of this just being a slight adjustment and thinking rates will soon fall to previous levels.

The Trickle Up Effect

When interest rates begin to move up, we see other leading indicators in the housing market begin to move in unison. Typically, inventory or unsold homes will increase as new homes become listed “for sale” and houses that have been “for sale” continue to increase their “days on market” or selling time due to the reduced activity of home buyers.

July days on market

Now is when home sellers begin to pay attention to the economic indicators which is typified by how many days the house has been on the market for sale. The net result is the longer number of days it takes to sell a house produces a decline in property values.

One way to avoid being at the mercy of the housing market is to accept the fact that pricing your Pasadena home properly is critical to getting out of this market as quickly as possible. The longer you’re in it, the less likely your chances of winning.

July Median Price

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Pasadena California Residential Real Estate, 1st Quarter Recap

April 17, 2008 By 2 Comments
Pasadena 91101

Earlier this week we reported on the Pasadena real estate market and the sales numbers for March.

Two things are quite obvious; unit sales are off by about 50% across the board. This seems to be true in LA County as well as California. And secondly, inventory levels of homes listed for sale are at the highest point we have probably seen in the last 10 years.

Since the Pasadena area covers such a wide geography and demographic area and because all real estate is local, I decided to break down the analysis by zip code and further dissect what is happening with home values in our city.

Pasadena 91101

Zip Code 91101 – This area is dominated by condos and townhomes. Last year saw quite a bit of activity on newer projects on E. Green St., S. Hudson and Union Street. A market shift has occurred with more mid priced units selling as opposed to higher end units. There are close to 29 homes in foreclosure with about a 10 month supply of inventory.

Pasadena 91103

Zip Code 91103 – Homes within this zip code could be referred to as “A Tale of Two Cities”. This area includes million dollar homes in Linda Vista and also homes east of the Rose Bowl to Marengo. The million dollar market remains fairly strong, however if you exclude homes that sold over $1 million, the median price has fallen from $540,000 last year to $450,000 this year. There are close to 130 homes in this eastern part of the zip code in some stage of foreclosure and approximately a 1 1/2 year supply of homes for sale.

Pasadena 91104

Zip Code 91104 – Including, Orange Heights, Bungalow Heaven, Historic Highlands, Garfield Heights and Brigden Ranch. There is a good cross section of homes in this area and the median price is down about 12%. Also this area is increasing in the number of foreclosures with about 100 properties currently listed. Close to a 10 month supply of homes on the market for sale.

Pasadena zip code 91105

Zip Code 91105 – This area includes San Rafael and features homes in the above average to high price range. It has also been the best performing neighborhood in Pasadena as far as maintaining value and will also be home to the new Pasadena Eco House. Home values have remained strong partly due to the low number (24) of properties in foreclosure. Current inventory indicates about a 12 month supply. This high number of homes for sale could very well produce some softening of values in the future.

Pasadena zip code 91106

Zip Code 91106 – This area features single family homes in Madison Heights in the million dollar plus range, but is also comprised of many condos and townhomes which make up about 75% of the units sold. Most of the price weakness in this area is from the 20+ year old townhomes and condos. Last year we did see the more expensive homes selling over their asking prices, however that has not been the case this year. This are 55 properties in foreclosure with the emphasis on condo/townhomes and several multi-family properties.

Pasadena zip code 91107

Zip Code 91107 – Local neighborhoods include Upper Hastings, Lower Hastings and Chapman Woods. Very similar to the characteristics in zip code 91104. Last year 12 recorded sales (townhomes & condo’s) occurred below $500,000, this year not one recorded sale. Again more evidence that the low end market is suffering the brunt of the housing slowdown. This zip code has suffered the largest decrease in unit sales and with the anemic sales in March, the current inventory is close to a 1 1/2 year supply. Foreclosure property count is 90 units and has been on the rise.

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