Falling Inventories and Rising Prices Span Nation to Include California & West Coast

Inventories are declining, and prices are rising, according to a recent report from Movoto Real Estate, a brokerage with a presence in 30 U.S. states.

Examining data from Multiple Listing Services in 34 cities across the nation, Movoto found year-over-year declines in June’s inventory in 32 of the 38 cities it tracks. The most drastic declines took place in Sacramento (-54.5 percent), Detroit (-47.1 percent), and Boston (-46.7 percent).

Over the same time period, price per square foot increased in all but two of the cities Movoto observes. The exceptions were New Orleans (-2.2 percent) and Chicago (-3.2 percent). Sacramento topped the list with a 68.1 percent price-per-square-foot increase.

Highlighting just the West Coast, Movoto found a year-over-year decrease in inventory but a month-over-month increase.

A composite of 14 major metros on the West Coast reveals an 11.9 percent yearly decline in inventory in June, according to Movoto. In contrast, listings rose month-over-month from 12,218 to 13,698.

West Coast cities with the steepest inventory decreases year-over-year in June were Salem, Oregon (-25.4 percent), Bellevue, Washington (-24.5 percent), and Los Angeles (-24.5 percent).

San Jose, California (19.2 percent), and San Diego, California (3.6 percent) were the only two of the 14 cities in the index to experience rising inventories over the 12-month period.

As inventory declines, price per square foot is on the rise. However, the two cities with growing inventories are not left out of this trend. San Diego and San Jose take the second and third places, respectively, in the ranking of cities by price increase over the year.

Price per square foot increased 20.8 percent in San Diego and 18.4 percent in San Jose.

The only city to beat these two was Los Angeles with a 28.6 percent increase. As of last month, the price per square foot for a home in Los Angeles is $432. This is the second-highest price per square foot on Movoto’s June index for the West Coast.

However, San Francisco outpaced all other cities with a price per square foot of $655.

Prices were also generally up over the month, according to Movoto, rising from $251 per square foot to $253 per square foot.

Source: DS News

Researchers: Monetary Policy Not Enough to Prevent Bubbles

National monetary policy alone cannot reliably prevent or reverse housing bubbles, according to a recent report from the Lincoln Institute of Land Policy. The downfall lies in the fact that housing prices and housing markets vary widely across the country, stated the researchers in the report. Monetary policy and large national programs such as the Home Affordable Modification Program (HAMP) may help some markets while hurting others, according to the report, , Preventing House Price Bubbles: Lessons from the 2006-2012 Bust.

Researchers from the Lincoln Institute of Land Policy offer a solution: local countercyclical capital policies.

“The basic idea is straightforward: when prices for a particular asset or sector are rising much faster than market fundamentals justify, bank regulators would increase the capital ratios for that asset,” the researchers explained.

Higher capital reserves make a bank safer and increase mortgage costs, dampening demand, according to the report.

The articles goes on to explain how this solution would help mitigate a the size of the bubble and it does make a good point.

However, they also point out - One of the obstacles to such a policy, the researchers stated, is “there will always be resistance to raising capital requirements when times appear to be good.”

Source: DS News

First-Time Buyers Have Smaller Budget, Interest in Foreclosures

First-time homebuyers tend to work with smaller budgets compared to repeat buyers, which increases the incentive to buy a foreclosure, according to blog from Doorsteps.com, a website that provides information to help potential homebuyers.

 Citing a survey from the National Association of Realtors (NAR), the website noted 65 percent of first-time buyers are open to the idea of purchasing a foreclosure despite all of the uncertainties surrounding distressed properties.

In addition, first-time buyers are also more likely to buy a foreclosure compared to a repeat buyer, according to the website.

Doorsteps.com provided three main reasons to explain this. For one, first-time buyers might have more of a reason to seek out discounted properties since they have a smaller budget. According to Doorsteps.com, first-time homebuyers spend an average of $154,100 on a home, which is $65,900 less that repeat buyers, who spend an average of $220,000.

According to the NAR, foreclosures sales offered an average discount of 15 percent compared to non-distressed sales in May.

First-time homebuyers might also have less of a reason to fear the unknown since it is likely they do not know as much about the buying process. In addition, with the abundance of foreclosures, first-time buyers might also view such properties as a “reasonable risk,” the website explained.

Data from Lender Processing Services showed there are a total of 4.56 million properties that are past due (includes delinquencies and foreclosure), of which 1.52 million are in foreclosure inventory as of May.

Source: DS News

Asking Home Prices Show Impressive Gain in June, Rents Pick Up

Asking home prices took off in June, soaring 10.7 percent year-over-year, Trulia reported Wednesday. Month-over-month, asking prices inched up by 1.5 percent and rose 4.1 percent on a quarterly basis. 

Rents rose at a slower pace of 2.8 percent year-over-year, though it was still the biggest increase since January. Trulia also tracked the 100 largest metro areas and revealed 99 markets experienced an increase in asking prices over the last year.

According to Trulia’s chief economist Jed Kolko, the increase in home prices and mortgage rates has added a significant cost to homeownership.

“In the past year, buying a home has become at least 20 percent more expensive,” said Kolko. “For young first-time homebuyers who don’t remember life during and before the bubble, these rising costs are a rude awakening.”

Rents rose at a slower pace of 2.8 percent year-over-year, though it was still the biggest increase since January.

Though, the scenario was reversed in Las Vegas; Oakland, California; and Sacramento, where asking prices shot up by at least 30 percent while rents saw a slight decrease over the last year.

Source: DS News

Chino Hills Single Family Home Price Trends

The graph below is the current year-over-year price trend for Chino Hills Original Price vs Sales Prices in Chino Hills. The data was pulled from the Multiple Listing Service (MLS) which is used by all Realtors.

Time frame is from Aug 2012 to Jul 2013

Results calculated from approximately 1,100 listings (Single Family Homes)

If you want the current data for any surrounding areas to include (but not limited to) Diamond Bar, Chino, Pomona, Yorba Linda, Walnut, Corona, Upland or Rancho Cucamonga, call Howard Curry @ 714-323-1233. 

Chino Hills Home Just Sold

My Chino Hills Listing on Shantung just entered escrow and I have more buyers looking for homes in Chino Hills so if you are looking to sell your Chino Hills Home Call Me Howard Curry your neighborhood Agent at 714-323-1233.

Why Families Choose Chino Hills?

Did you know?...

1. Chino Hills was ranked 34th in Money magazine's "Best places to live 2012.
2. Chino Hills selected one of the 100 Best Communities for Young People for the second year in a row
3. Featured on the list of 87 of America’s hottest towns in the January 2004 issue of Money magazine.
4. Chino Hills was also ranked 8th on the list of “best places in the West with a population under 100,000.” in the January 2004 issue of Money Magazine. 
5. It is the 6th highest income place in the United States (with population 65,000 to 250,000) and was ranked as the 13th safest city in the United States in 2008 by the FBI

 Call me to find the perfect home for you and your family

 Howard Curry 714-323-1233

 Realtor DRE 01894644

 Your Century 21 Beachside Real Estate Professional Serving Chino Hills and surrounding Communities