Palos Verdes Homes and the Wall Street Journal Article

Have Palos Verdes Homes prices finally hit a bottom in 2012?  So will 2013 be the year of recovery or relapse for Palos Verdes real estate?

The Wall Street Journal has recently published an article entitled “”.  The article talks about how for the past couple of years, the inventory level of homes has dropped.  As a real estate broker, I can tell you that’s a mixed blessing as while the supply/demand balance has certainly helped stabilize prices for Palos Verdes homes, the lack of inventory (as you will see in the Video below) is at the lowest level in decades and thus makes it hard for us to find homes for our many buyers!

However, don’t make the mistake of thinking that we’re in the same sort of a market as we were from 2003 to 2006.  One of the reasons why inventory levels are so low is because many homeowners are unwilling or unable to sell at the prices that exist today.  Yes, prices have firmed, but they aren’t anywhere close to the levels that were at the peak of the market in the 4th quarter of ‘06.  Many of owners who own Palos Verdes homes are still in barely positive equity, many are in very negative equity and where they would be sellers in a “normal” market, they can not bring their homes to market at today’s price levels.

Although, as prices pick up, that will change, we will see inventories increase and hence the market cycle continues.  For now, buyers have a double positive – incredibly low interest rates and prices that from a historical perspective are also very, very favorable.  You can click the “Housing Inventory Drops in November” chart to get to the interactive charts.  However, for a more micro economic view point, please play the Video below.

If you would like to see a full sized image of the chart for Palos Verdes homes above, .

Palos Verdes Homes market reports are available by subscription and are reserved for clients or those who are considering to become a client. 

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Palos Verdes Home Prices

Palos Verdes home prices are trending up.  But this article published by doesn’t get the whole story, in fact I think they’re missing more than half the point.  Sure, interest rates being as low as they are clearly help home sales.

But when they report "Tim Iacano of Iacano Research credits the majority of the recovery and rise in home prices—if not all of it—to the Federal Reserve’s aggressive actions to keep mortgage rates low. The Fed’s quantitative easing (QE) program has prompted mortgage rates to fall to all-time lows in recent weeks.” they are missing a critically important law of economics.  They don’t even talk about the issue SUPPLY & DEMAND. 

Interest rates are so low, that even if they were to go up 1-2 percent, they would still be incredibly low relative to decades long historical standards.  So it can’t be that low interest rates are sole driver let alone major contributor as Mr. Iacano would have us believe.  While I can’t speak for a national real estate market, I can certainly provide you hard fact documentation on Palos Verdes home prices and what is happening with the supply & demand dynamic for Palos Verdes homes as well as for the Greater South Bay area.

Let’s take a look at what’s happening. Palos Verdes Home Prices trends are patterning this chart on the South Bay

You can email me for a larger copy of this chart if you wish.  The red trend line shows the volume of Pending Sales going back to May of 1990 (yes, I keep track), the blue line tracks the New Listing Volume.  Think of Pending Sale Volume as a measure of demand and think of New Listing Volume as a measure of supply.  Clearly, it’s starkly evident, the number of new listings coming to market is the lowest it’s been in nearly 20 years!  At the same time that supplies have been dropping of Palos Verdes homes and other homes around the South Bay, demand has been picking up. 

We all know what happens when people want more of something, but that something is less and less available.  And as you can see by green line, prices indeed have been firming, in fact they’ve been going up.

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George Fotion
Call Realty Company
(310) 346-6467
gfotion@emailtreo.com

Palos Verdes Real Estate Supply & Demand Trends for December 2012

imageThe latest information on Palos Verdes real estate trends is GOOD.  Market data is showing that the supplies of homes are down and demand is up.

This trend of month over month improvement in the supply demand dynamics strongly suggests an improving real estate market.

Are you interested in learning more about:

  • What are the specific trends in your neighborhood for Palos Verdes homes (or whatever South Bay market you’re in)?
  • How would the market value your home in today’s improving Palos Verdes real estate market?

Just send me an email or give me a call, and I will get on it for you!

Palos Verdes Real Estate Trends Improving

for a larger view of this chart, please visit http://www.palosverdesrealestatetransactionreport.com/

From 277 days of unsold inventory in the South Bay area (including Palos Verdes homes) to 189 days in one year, is a huge improvement in the market!  That’s a 32% increase in the South Bay & Palos Verdes real estate market’s ability to absorb inventory through sale activity.  So the question is … supplies down, demand up, what do YOU think that does to prices?

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Homes for sale in Palos Verdes Estates
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South Torrance homes for sale
George Fotion
Call Realty Company
(310) 346-6467
gfotion@emailtreo.com