SoCal sales shifting to pricier homes
January 19th, 2010, 2:22 pm · posted by Jeff Collins

Home sales in the region shifted to pricier areas last month, pushing December’s overall median home price up 4%, MDA DataQuick reported today.

* Relatively large annual sales gains were recorded last month in such higher-end markets as Beverly Hills, Santa Monica and Newport Beach — areas that saw very low sales a year ago.
* Some of the more affordable inland areas that saw robust 2008 sales recorded year-over-year declines last month. Those markets included Moreno Valley, Lake Elsinore and Palmdale.
* Overall, the Southern California median home price increased to $289,000, the first annual price gain in about 2 1/2 years. It was the highest median sales price since October 2008.
* Prices rose in every county but Riverside and San Bernardino.
* Sales were up 12.1% to 22,328, the largest number for a December since 2006, DataQuick reported.
* Sales were up in every county in the region but Riverside.

What do you think?

Following are some of the reasons that Mr. Scnhiepp outlines for the recovery to occur.

Expected Timeline for Recovery:
Southern California

• Home prices are stabilizing as foreclosures
  decline this year.
• Selling values will begin rising again, no less than
  one year following the end point (month) of the general
  recession in California.
• The general economic recovery in California will lag
  the nation by one quarter. Consequently, recovery occurs no later than the winter of 2010, with more convincing evidence by the spring of 2010.
• Home sales are rising now in Southern Santa Barbara
  County for condominiums and for lower priced single family homes. In the Santa Maria Valley, sales are soaring, largely due to fire-sale priced distressed homes. This is also true in the Inland Empire, the Antelope Valley, and Northern Orange County.
• More broad-based participation by all price ranges of
  the housing market will occur in 2010, providing mortgage rates and credit market conditions remain favorable.
• The likelihood that mortgage rates will remain compet-
  ive into 2010 is high. The Federal Reserve will unlikely increase
  rates over the next 9 months, to insure that…

Berkshire, Leucadia Join to Acquire Capmark Assets (Update3)

By Andrew Frye and Pierre Paulden

Sept. 2 (Bloomberg) — Warren Buffett’s Berkshire Hathaway Inc. and Leucadia National Corp. agreed to pay as much as $490 million for Capmark Financial Group Inc.’s loan-servicing and mortgage business in a bet on the U.S. real estate market.

The partnership of Omaha, Nebraska-based Berkshire and New York-based Leucadia was paid $40 million by Capmark to enter into the agreement, the Horsham, Pennsylvania-based lender said today in a statement. The deal gives Capmark the right to sell the assets later to the venture, known as Berkadia III LLC. Capmark may file for bankruptcy after a $1.6 billion second- quarter loss, the lender said in a separate statement today.

Berkshire has been increasing investments in the U.S. real estate market, buying shares of banks including Wells Fargo & Co., the No. 1 U.S. mortgage lender this year. Yesterday, Berkshire’s real-estate brokerage unit announced it acquired a Chicago-based agency to expand in Illinois.

The Capmark deal “fits with the real estate brokerage they…

By: Jeff Cox, CNBC.com | 02 Jun 2009 | 02:27 PM ET

After taking a beating for the past two years, real estate investment trusts are regaining popularity with investors looking for bargains and a way to capitalize on an industry rebound.

More commonly known by their acronym, REITs are funds that provide investors with a broad range of investment opportunities while delivering substantial tax breaks to the corporations that set up the vehicles.

Wildly popular in the earlier part of the decade during the real estate boom, REITs nosedived in 2006 and 2007 as the market fell correspondingly.

But recent developments over the past several weeks have sharp-eyed investors again examining REITs as a way to profit from a looming rebound in the industry.

* REIT Stocks: Long and Short Strategies

And contrary to the growing trend of investors to eschew the traditional buy-and-hold stocks strategy, REITs are being looked at as long-term plays that will…

But I believe another factor is that the Southern California economy is doing better than many other regional economies around the country. Here are the reasons why I believe that to be the case.

Construction and real estate are hurting here, obviously (and my colleagues and I do see a lot of clients in these fields under financial stress). But other prominent sectors of the regional economy are picking up the slack and softening the blow.

Domestic tourism, although slightly down, is still holding steady in Southern California. Many Americans who used to fly overseas for vacation are staying home due to airline prices, currency valuations and security reasons – and they are now staying domestic,…

TWO ELITE PROPERTIES ARE ADDED TO THE OCEANFRONT DESTINATION MARKETING ALLIANCE

The Ritz-Carlton, Laguna Niguel And The Resort at Pelican Hill To Participate In The Promotion Of Coastal Orange County

THE OCEANFRONT, ORANGE COUNTY, Calif. – The Ritz-Carlton, Laguna Niguel and the Resort at Pelican Hill (set to open in December of this year) recently joined The OCeanfront, an exclusive destination marketing alliance organized to promote Orange County, California’s most prestigious coastal destinations, according to an announcement by Blaise Bartell, chairman of The OCeanfront. The OCeanfront alliance now consists of the area’s 12 leading hotels and resorts, golf club operators, shopping venues and convention and visitors bureaus spanning
the 42-mile stretch of coastline from Huntington Beach to Dana Point.

“The addition of The Ritz-Carlton, Laguna Niguel and The Resort at…

September 16, 2008 – Builder confidence in the market for newly built single-family homes rose for the first time in seven months this September, according to the National Association of Home Builders/Wells Fargo Housing Market Index (HMI), released today. The HMI gained two points to 18, rising from its record low of the previous two months.

“Builders have several reasons to be more optimistic at this time,” noted NAHB President Sandy Dunn, a home builder from Point Pleasant, W.Va. “Many are sensing that home sales are nearing a turning point with the support of the newly enacted first-time home buyer tax credit. Meanwhile, with the government’s explicit backing of Fannie Mae and Freddie Mac now assured, this should help keep mortgage rates at very favorable levels going forward.”

Following the Treasury Department’s announcement that it was placing mortgage giants Fannie Mae and Freddie Mac into conservatorship last week, the average rate on 30-year fixed-rate conforming home mortgages declined by nearly half a percentage point, falling to below 6 percent for the first time in several months. Market responses to the Lehman Brothers…

El Morro Village: Unpaving paradise near Laguna Beach

Two years after El Morro Village was finally vacated, construction has begun on the state’s first new coastal campground in decades.

By Susannah Rosenblatt, Los Angeles Times Staff Writer
10:47 AM PDT, August 25, 2008

El Morro Village: Unpaving paradise

All that’s left of the 295 seaside trailers just north of Laguna Beach, once festooned with flowerpots and tidy patios, are some crumbling concrete slabs. And memories.

Dump trucks and earthmovers are scraping across 35 acres of canyon and beach, transforming the funky little enclave that was El Morro Village into Southern California’s first coastal campground in two decades.

State parks officials and environmentalists trumpet the $12-million construction project, which began last month, as a victory for public access and the preservation of pristine Orange County coastline.

“Tens of thousands of added Californians and people from all across the nation can now enjoy this spot of Southern California paradise,” said state parks spokesman Roy Stearns. “It opens up a whole new coastal ocean…

R.O.I.
By BRETT ARENDS

Is Housing Slump at a Bottom?
May 6, 2008 7:28 p.m.

Is it time, at long last, to head down to Florida to start looking at homes?

Maybe.

And the nearby chart shows one reason why.

It comes from Wellesley College Prof. Karl E. Case, one of the leading experts on the housing market in the country. And it suggests we may be at, or near, the bottom of the housing crash.

Of course, even if he’s wrong we won’t know for sure for many months.

But new housing starts have at last slumped below the seemingly magical one million mark. That happened in March. Every time that has happened in the last 50 years, it proved to be the bottom of a recession.

“It is really remarkable how much where we are today looks like the bottom we’ve had in the last three cycles,” Mr. Case says. “Every time we’ve gone below a million starts, the market has cleared at that moment.”

There is no guarantee this market will be the same but the similarities with the past are striking. Each boom peaked at around the same level of 2.5 million starts…

OPINION

The Housing Crisis Is Over
By CYRIL MOULLE-BERTEAUX
May 6, 2008; Page A23

The dire headlines coming fast and furious in the financial and popular press suggest that the housing crisis is intensifying. Yet it is very likely that April 2008 will mark the bottom of the U.S. housing market. Yes, the housing market is bottoming right now.

How can this be? For starters, a bottom does not mean that prices are about to return to the heady days of 2005. That probably won’t happen for another 15 years. It just means that the trend is no longer getting worse, which is the critical factor.

Most people forget that the current housing bust is nearly three years old. Home sales peaked in July 2005. New home sales are down a staggering 63% from peak levels of 1.4 million. Housing starts have fallen more than 50% and, adjusted for population growth, are back to the trough levels of 1982.

Furthermore, residential construction is close to 15-year lows at 3.8% of GDP; by the fourth quarter of this year, it will probably hit the lowest level ever. So…

By CNBC.com | 26 Feb 2008 | 09:43 AM ET

The US economy will avoid recession as the housing market begins to recover this spring, according to billionaire investor Sam Zell.

Speaking on “Squawk Box” this morning, Zell attributed much of the current economic troubles to fear-mongering and politicking by Democratic presidential contenders Hillary Rodham Clinton and Barack Obama.

“Obviously what we have going on is an attempt to create a self-fulfilling prophecy,” said Zell, chairman of Equity Investments Group and owner of the Chicago Cubs, Chicago Tribune, Los Angeles Times and other companies. “We have two Democratic candidates who are vying with each other to describe the economic situation worse.

“The reality is that if you live on Wall Street and you’re in the credit markets the world couldn’t be worse. If you’re a farmer and you’re getting $25 for your wheat, you’re having a great time. If you’re a CEO and you’ve got a balance sheet that’s bullet-proof, you’re in a great position. This whole thing is way out of control, way out of hand.”

Zell said that although he doesn’t try to pick bottoms in markets…

Our no-recession forecast remains nervously intact. We see a lot of problems in the first half of 2008, as housing remains a drag on GDP growth and weakness in personal consumption contributes as well,” he writes. “We expect one quarter of negative GDP growth. The Fed continues to dish out good news for Wall Street with ever lower interest rates. The labor market is sluggish and unemployment elevates to 5.5 percent by the end of 2008. But the housing drag on GDP dissipates in the second half of the year and a normal economy returns in 2009.

This brief quote gives a glimpse of light at the end of the current housing crises tunnel from the generally pessimistic outlook of the Anderson Reports.

• Statewide, the 10 cities and communities with the highest median home prices in California during November 2007 were: Newport Beach, $1,400,000; Saratoga, $1,300,000; Santa Monica, $1,100,000; Cupertino, $1,074,090; Santa Barbara, $1,065,000; Danville, $1,021,000; Yorba Linda, $910,000; San Clemente, $870,000; Redwood City, $822,500 and San Francisco, $814,500.
• Statewide, the 13* cities and communities with the greatest median home price increases in November 2007 compared with the same period a year ago were: San Juan Capistrano, 42.3 percent; Newport Beach, 31.5 percent; Santa Monica, 29.4 percent; Mountain View, 18 percent; Cupertino, 18 percent; Truckee, 10.2 percent; Redwood City, 9.7 percent; Yorba Linda, 9.6 percent; Santa Barbara, 7.5 percent; Moorpark, 7.2 percent; San Francisco, 7.2 percent; Pasadena, 7.2 percent; and Los Angeles, 5.8 percent.

This is just another indication that prices of property located in desirable areas continue to hold steady or increase even during the current real estate downturn.

Newport Beach city officials say the acquisition of a 4-acre piece of land on East Coast Highway with access to Upper Newport Bay as part of a multi-million-dollar development agreement with the Irvine Co. is a boon for the city.

“I think we’ll look back on it, and this will be one of the major benefits of this deal,” said Councilman Steve Rosansky, who helped broker the Irvine Co. deal, along with Mayor Ed Selich. “It’s one of the last pieces of undeveloped land on the waterfront.”[read more...]

• Statewide, the 10 cities and communities with the highest median home prices in California during October 2007 were: Newport Beach, $1,575,000; Santa Barbara, $1,275,000; Cupertino, $1,033,000; Danville, $1,017,500; Los Gatos, $1,005,000; San Carlos, $927,500; Redwood City, $912,000; San Ramon, $835,000; San Clemente, $832,500; and San Mateo, $829,500.
• Statewide, the 10 cities and communities with the greatest median home price increases in October 2007 compared with the same period a year ago were: Santa Barbara, 24.4 percent; Arcadia, 21.3 percent; Redwood City, 20.6 percent; Newport Beach, 18.4 percent; San Ramon, 14.4 percent; Cupertino, 11.7 percent; San Carlos, 9.5 percent; Redlands, 8.8 percent; Redondo Beach, 8.7 percent; and Sunnyvale, 7.6 percent.

This is just another indication that prices of property located in desirable areas continue to hold steady or increase even during the current real estate downturn.

AP
Foreign Cash Could Boost Housing Market
Saturday November 10, 2:35 am ET

By Stephen Bernard, AP Business Writer

Foreign Cash Could Provide Much Needed Relief for U.S. Housing Market Thanks to Weak Dollar

NEW YORK (AP) — The weakening dollar has caused many problems for consumers, but it may also be providing the fuel for one unintended — and very welcome — benefit: a rally in the struggling housing market driven by foreign investors.

For an individual or developer trying to sell a home, interested buyers are just as likely to already have a place in London or Paris as they are to be first-timers new to the market.

“European investment is likely to pick up,” said Mark Vitner, chief economist for Charlotte, N.C.-based Wachovia Corp. “Now is the time to come over and take advantage.”

The theory goes that foreign investors step in and replace first-time home buyers who have been squeezed out of the housing market during the recent downturn. These new investors in turn allow current homeowners to sell and trade up to larger homes.

That will help restart owners…

For more information, contact:

Walt Molony, 702/691-8592, wmolony@realtors.org

Modest Recovery for Existing-Home Sales in 2008 as Credit Crunch Subsides

LAS VEGAS, November 13, 2007 -  A modest recovery for existing-home sales is expected in 2008 as the impact of the credit crunch subsides, while pending home sales indicate near-term stability, according to the latest forecast released here today at the National Association of Realtors® Conference & Expo. Lawrence Yun, NAR chief economist, said the housing market will improve from a steady unleashing of pent-up demand, and from a wide abundance of safer mortgage products. “The level of pent-up demand reaching the market next year is a bit uncertain, and it is possible for even higher home sales activity than we’re forecasting if buyers regain their confidence about the long-term benefits of home ownership.  Over the near term, home sales are likely to be fairly flat as the lingering impact of the credit crunch filters through the system through the end of the year.” The Pending Home Sales Index,* a forward-looking indicator based on contracts signed in September, rose 0.2 percent to a reading of 85.7 from…

• Statewide, the 10 cities and communities with the highest median home prices in California during September 2007 were: Newport Beach, $1,435,000; Los Gatos, $1,228,000; Cupertino, $1,050,000; Danville, $1,004,000; Redondo Beach, $847,500; San Clemente, $830,000; Yorba Linda, $825,000; Arcadia, $805,000; San Rafael, $797,500; and Santa Monica, $796,500.
• Statewide, the 10 cities and communities with the greatest median home price increases in September 2007 compared with the same period a year ago were: Tustin, 19.7 percent; Los Angeles, 18.2 percent; Arcadia, 14.2 percent; Carlsbad, 11.1 percent; Laguna Niguel, 10.1 percent; Diamond Bar, 8.7 percent; Cupertino, 8.4 percent; Redondo Beach, 8 percent; Reedley, 7.1 percent; and Newport Beach, 6.3 percent.

This is just another indication that prices of property located in desirable areas are holding steady or increasing even during the current real estate downturn.

The Forecast

Waiting Room
by Lawrence Yun, Vice President, NAR Research

Several positive developments in the credit market will pave the way for improving housing market conditions going into 2008. The worst of the credit crunch concerns we saw in August are clearly over. A bold move by the Federal Reserve in cutting the federal funds rate by 50 basis points helped liquidity. Even more importantly, the Fed’s action bolstered the confidence of financial investors that the Fed will not permit a freezing of credit in the marketplace. Consequently, markets have settled down and mortgage rates are now more favorable compared to those in August.

But it’s interesting to note that credit in the conforming loan market (those loans under $417,000 and those that meet the guidelines of Government Sponsored Enterprises like Freddie Mac and Fannie Mae) has been widely available throughout the recent crisis. It was the jumbo loan market that was particularly hard hit, with the spread over conforming loans rising to over 150 basis points, rather than the historic average of 20 to 30 basis…