Many of you may have read the front page article in the L A Times today (Friday 3/14) which discussed the terrible real estate market that we presently have. I’d like to give you a little more information on the local version. Here in the foothill communities of La Crescenta, La Canada, Montrose, Glendale, Sunland, Tujunga & Shadow Hills things look a little different.
First of all, there are problems in the market place. Foreclosures are a big problem and they are driving prices down. That’s a sad fact of life today. In fact, depending on how things develop, foreclosures will probably be about 30% of the sales for most of the rest of the year.
Here are a couple of important facts to remember:
- Sales in the foothills are down 49% in 2007 v 2008
- Inventory is plentiful – about 5 months worth of supply
- “Normal” Supply (Seller & Buyer have equal negotiating power) is about 6 months
So, we have a normal amount of supply which includes many foreclosures. We have a shortage of buyers owing to the financial crisis and lack of available loans. While this is not a healthy situation, it is not nearly as bad as it sounds in the newspapers. Now I’m not familiar with the market situation in other areas of the state but it is really not as bad as the newspaper portrays.
The downward pressure on prices has made more housing affordable again to young people. Investment property is once again becoming attractively priced. The foreclosures will probably begin offering attractive pricing on loans soon. As long as our local job market remains healthy we should avoid the dire predictions the newspapers are putting in the headlines.
Statistics taken from i-Tech MLS & are deemed reliable but not guaranteed and are subject to change