Timely Real Estate News………………………………………………….15 November 2013
******************************************************************************************************************
A new format…..would like your comments.
After some market research, we have concluded that most of our readers prefer we focus on just real estate and not drift off to “places to visit” and “interesting city facts” — which has been a trend we started several years ago. We are now bringing you the latest, most up-to-date real estate news on the market in general, as well as the four communities I report on — Beverly Hills, Beverly Hills Post Office, Bel-Air, and Brentwood. Of course, I would love your comments as to whether you like this direction or would like more general-interest stories that are more community-oriented. I will continue to offer information on fun local places to go and things to do, but it will now be on my Facebook Page.. www.facebook.com/CaroleSchifferRealtor
********************************************************************************************************************
Happy Thanksgiving….from the Carole Schiffer team
This is such a wonderful time of year to sit back and enjoy your family and friends!. I want to extend to you and yours a wonderful and tasty Thanksgiving celebration, and hopefully a football game or two.
******************************************************************************************************************
How is the real estate market? Depends on what you’re reading these days…..
Having been around this real estate block more than once, the more things change, the more they stay the same. We have all seen/heard the stories in the media that Southern California real estate is up, down, or flat. It’s in crisis or ‘we’ve bottomed out’….or we’re on the mend. The latest/greatest story to hit the Business Section of the Los Angeles Times refers to this week’s statistics from respected Data Quick that home prices appear to have hit a wall, with the medium home price flat for the fourth consecutive month.
How you respond to this news should be within the context of where you live. If you’re reading this story from your home in Beverly Hills, Beverly Hills Post Office, Brentwood, or Bel-Air, then “flat” may not be an accurate description.
So what’s the story? According to one economist at Chapman University, Esmael Adibi, “we have reached a plateau.” But there are others who see “a more seasonal slowing — nothing to worry about — as families put their home search on hold not wanting
to make a move with their children in school and the holidays approaching.”
I agree with that — to some degree. We have had traditional slow periods in late fall, but as I mentioned in my last edition of the SchifferLine, we are still seeing strong activity in the market. Another economist, Christopher Thornberg, a founding partner at Beacon Economics — states that “by no means, are we flattening out. There is way too much demand out there relative to supply.” While we have more inventory than we had a few months ago, we continue to lack enough quality homes to sell in West Los Angeles, consequently, demand is up as Dr. Thornberg says.
One of the trends in our real estate market, however, has been the decline of the foreclosure/short sale inventory. We have seen a drop of 4.4% from a year earlier to a total of 20,150 existing and newly built houses and condos, which includes foreclosure/short sale properties. That measure is important to the economy because a sale usually spurs
homeowners to spend on other items such as furniture. This drop, however, is largely due to the rapidly shrinking
supply of foreclosed homes for sale. Once distressed sales, which include short sales, are removed from the data, conventional sales skyrocketed 32% compared with a year ago. And that’s an important # to focus on.
********************************************************************************************************************
What’s happened to “us” since 2007 when the market peaked?
Just how far have we come back? Are we approaching our former peak year in 2007? Well, the answer is “yes” and “no”. In reviewing the Median Sales Prices for a similar period of 2007, when prices were near or at their zenith, we have five communities whose prices have actually gone up over 2007. These are Beverly Hills up 25%; Marina del Rey, Venice, West Hollywood and Pacific Palisades all up 10%. Playa Vista, Santa Monica and Brentwood were even with 2007 prices.
But the other Westside communities that have not come back and are still down by 25% include Beverly Hills Post Office, Bel-Air, Hancock Park, and Malibu. Sunset Strip was down 14% and Westwood/Century City were down just 10% from their peak….. Playa del Rey is down 35% and Malibu Beach is off by 20%.
*******************************************************************************************************************
A healthy market ahead?
According to Bill McBride, who writes a financial blog for Calculated Risk, states that “we are trending toward a healthy market”. Homes sold that had been foreclosed upon within the last year constituted 6.3% of existing home sales, down from 16.3% a year earlier and the lowest level since May 2007, said Data Quick, the respected San Diego-based real estate tracking firm. Short
sales also fell, from 27.2% of the resale market last year to 12.9% in October. So these are important trends to getting our market back into a healthier state.
What we are seeing is the hangover of developers who have scooped up many of the lower-priced homes to flip or rent. Also, many owners in more-affordable areas still owe more on their mortgage than their house is worth, limiting their ability to sell and constraining supply, Data Quick said. But again — While this is happening across the board in many markets, it is not quite as prevalent in our West Los Angeles market. For a more accurate picture, see the story below. If you have any questions about any of this confusing and sometimes conflicting info, please me at 310-442-1384.
********************************************************************************************************************
Beverly Hills is, well, Beverly Hills…..zooming right along
I have not seen a median sales price of $6 million for one my four communities since I have been selling real estate on the 
Westside. On November 1, when the new MLS stats were released, I saw that Beverly Hills hit the $6 million median sales price level, which included a total of 12 properties that closed escrow in October, with nine homes over $4 million, two homes over $7 million, and three over $13 million, the highest going for $27 million plus. These were all sales that took place a few months earlier when the market was more active than it is today. Today, we’re actually in a slower — but healthier — market.
The highest-priced home was on Tower Road for $27,500,000 and one for $19,500,000 on Sunset. These large sales, of course, drive up sales volume for the four communities I report on, which is now showing a total of a 9% increase in sales volume over 2012 year to date of more than $2.215 billion. But, with the larger sales, the stats also reflect a longer period of Days on Market — 114 days compared to 74 days just a month ago for Beverly Hills. In most cases, the larger the transaction, the longer it takes to sell, which has been the rule, not the exception.
Beverly Hills’ year-to-date MSP of $4.675 million through October 2013, reflects its continued strength in — it’s a
28% increase over October 2012’s MSP of $3.650 million. Beverly Hills showed a 109% increase in Median Sales Price over October 2012.
The year-to-date median sales prices all moved up in Brentwood, Bel-Air, BHPO
While Beverly Hills was having a very strong October…Brentwood wasn’t far behind with a 70% increase in median
sales price increase over the previous year. This October, Brentwood’s MSP was $2.546 million vs. $1.501 price for October 2012. Brentwood’s Median Sales Prices for Year-to-Date with $2.345 million vs. $1.762 million for last year’s comparable period, a 33% increase. Its average Days on Market for October was 75 days vs. 63 days in October 2012, a 12% increase.
Bel-Air’s Median Sales Price for October 2012 was $2.645 million vs. $2.414 million for October 2013, a 9% decline. However, its MSP for the January–October 2013 period was up 4%, $1.945 million for the period vs. $1.868 million for the comparable 10 months of 2012. Days on Market for Bel Air was 97 days for October 2012 vs. 78 days for October 13, a 19% decrease.
Beverly Hills Post Office also showed an increase in Median Sales Prices for Year-to-Date, with a 3% increase, going from $2.000 million in same period in 2012 to $2.075 million for the same period in 2013. In comparing October 2013
to October 2012, BHPO had a 1% decrease in Median Sales Price — going from $2.417 million in October 2012 to $2.450 million in October 2013. Average Days on Market for 2013 was 45 vs. 64 for October 2012.
Strong showing month-to-month trend
Each of the four communities I report on showed healthy increases over Median Sales Prices for October 2013 compared to the previous month, September 2013. Beverly Hills was up 45% in MSP for October vs. September….Beverly Hills Post Office was 
up 42%….Bel-Air was up 35%….and Brentwood was up 16%. It is not that often that all four of the areas are in positive numbers — one or two are always out of the mix.
What October statistics brought us was the realization that a one-month blow-out performance in one community is an aberration, and as I have said before, I rely on year-to-date MSP as a truer indication of the market temperature. As I have said, the market has cooled down somewhat, so please take some of the high numbers with a grain of salt.
Since I don’t possess a crystal ball that can tell you where all this is going, the median average is the best barometer we have compared to average sales price. We all understand that we live in a area where housing prices are high compared to so many other metropolitan areas in the US….but home is home: We care most greatly about what happens in our neighborhood. And I warn my clients not to jump to conclusions about a bump in one month for average home prices, because it can turn on a dime the next.
*******************************************************************************************************************
What do the experts that I share the trench with say?
I attended the Previews Directors meeting the other day. Previews Directors are Coldwell Banker’s designation for those agents, such as myself that specialize in the sale of high end (luxury properties). We meet on a quarterly basis. To a person, everyone
who gave their reports on the area(s) that they specialize in said basically the same thing… “The market is a little slower today than it was a few months ago, but it is still healthy.
“Buyers today are looking for houses that are Done, Done, Done or major fixers, but that the middle category of homes that may need some work or are flippers that were not well done are reflecting the softer parts of the market”. Looking forward to 2014, prices will continue to improve, but most likely at a slower, healthier rate and the buyers are still there.
So, we are in flux for now. The economy is still showing signs of recovery — but it has in the past, too, as outside
forces have impacted our recovery efforts. On the Westside real estate front, home prices appear on the rise as demand continues strong, sales volume is ahead of last year, and each area is showing strong signs of recovery.
*******************************************************************************************************************
Thank you…
I also want to thank all of you who have participated in my One Warm Coat campaign. The response has been WONDERFUL!… I cannot fit everything in my trunk, and I have a big one. If you still want have some cold weather items that you want to donate, please do not hesitate to give me a call.. 310 442-1384 or shoot me an email. …carole@caroleschiffer.com I will be more than happy to swing by and pick up your items …
Once again, I hope you have a wonderful Thanksgiving holiday!
You must be logged in to post a comment.