Monday Morning Numbers 4/26/10

Hey, kids, do you know what time it is? That's right - it's time for Monday Morning Numbers! Let's take a look at our market stats for this week:

Active Listings: 87

Contingent Listings: 38

Pending Listings: 54 (30.2% of the inventory)

New listings: 11

Months of inventory: 3.9

Click here for the updated price per square foot chart.

For the third week in a row, we have double digit new listings. That's the first time we've had that since September. A little bit more of the mix this week that you'd typically expect, with 5 REO's and 2 short sales among those 11. We've started to see a little bit of an increase in properties going back to the bank in the last week or so, but our unlisted REO's are still hanging in at around 60.

Come back later this week for an update on Southside activity.

Focus On Short Sales

News flash: Short sales are an increasing segment of our market.

Nuff said? Are we done here?




Don't be silly, you aren't getting off that easy. Let's look at some of our current market numbers on short sales, and then I'll get into a couple of developments that will be affecting that segment - and by extension, our entire market - in the future.

As of right now, short sales account for 42.1% of our combined active and contingent listings. That's down slightly from 46.1% when I reported on this segment a few months ago. The mix has shifted just a bit, with 28.9% of our active listings (very close to the 29.3% in January), but the percentage of our contingent listings has dropped to 71.1% (from 80%). Part of this has to do with the increase of traditional listings on the market over the past few months, and some of those are going into a sale contingency status prior to going to pending.

Speaking of pending listings, 25.9% of our pending sales are short sales. This is up from 24.3% a few months ago, which is in line with what appears to be a shift towards short sales as a percentage of our sold units. If you read last week's 2010 First Quarter Update post, you'd know that short sales accounted for 14.9% of the sold units in the first three months of the year.

The success rate for short sales also continues to improve. 37.8% of the resolved short sale listings that have come on the market over the past 14 months have sold, compared to 72.4% for the market as a whole. Back in January, those numbers were 32.2% and 71.4%.

I expect these numbers to continue to improve. At some point, probably late this year or early next year, I expect to see short sales become the largest market segment in our sold units, outpacing REO sales. Why is that? Well, as I've said here a few different times, the banks are getting better about processing these transactions, our industry is getting better about it, and buyers are hanging in through the process more often because they don't have so many options in this tight inventory market. We're starting to hear more stories of banks encouraging home owners to pursue a short sale when they are having trouble making payments, and that's because they've figured out that the return they get letting a property go to foreclosure and selling it as an REO is significantly less than if they let it go as a short sale. Many of the large lenders have been ramping up and hiring thousands of people to work in their short sale departments.

We also have a new Federal government program that was implemented this month. The Home Affordable Foreclosure Alternatives (HAFA) program was started to supplement the Home Affordable Modification Program (HAMP) that started last year. HAMP is designed to keep homeowners in their homes by encouraging participating lenders to offer loan modifications to homeowners in distress. It got a lot of bad press in the industry early on, because the success rate was dismal. But in recent months, it appears that HAMP has helped at least a few homeowners. But there are many, many cases where a loan mod just isn't going to work, and a short sale is a much more viable option.

Most major lenders are participating in HAFA, but even with a participating lender, not all loans qualify. Notably, this program is only available for owner occupied homes, and Fannie Mae/Freddie Mac owned mortgages are not included. Fannie & Freddie have a program of their own that should roll out in the coming months, so we'll see how that fits. And even if a loan doesn't fit into any of these programs, there still could be a place for a short sale.

And as long as I'm on the subject, I'm going to indulge in a little bit of self-promotion. I don't do a lot of this on this blog, but once in a while it's warranted. Diane (you know, the smarter and better looking half of the team) recently earned the Certified Distressed Property Expert (CDPE) designation from the Distressed Property Institute. This is the premiere designation for agents who work with short sales. There is another designation out there, the Short Sales & Foreclosure Resource (SFR) that is available. This is the designation that our National Association of Realtors recognizes, and since I'm a NAR member, I'm want to be careful not to give you the wrong impression here. There are many very good Realtors with the SFR designation, including several in our market. But honestly, we compared it to the CDPE, and for the scope of the training, both initially and on an ongoing basis, the systems that they've developed to help us get short sales processed, the whole package - CDPE was far and away the more comprehensive choice. It's also more expensive, which is one reason that we have several SFR agents in town. But as of right now, we only have one CDPE in Lompoc. That's Diane. And if you've worked with her, you know that she's the most detail oriented person you could ever hope to encounter. And that's exactly what you want in a short sale listing agent.

OK, the commercial is over... In a nutshell, like I said at the open: Short sales are an increasing segment of our market. And they will be for quite a while. I still think that this is a 5 year cycle. We have a lot of purchases and refinances from the peak years out there, and until we get some solid price appreciation again, any of those people who need to sell are going to be upside down. Get used to it, short sales are here for a nice long stay.

Monday Morning Numbers 4/19/10

Good morning once again. I hope everybody had a good weekend. I finally got around to getting my garden planted yesterday. In a few months, I should be up to my ears in tomatoes and peppers, and busily making some salsa. How do you like your salsa? I make three levels - hot, very hot, and call 9-1-1. Let's take a look at this week's market stats:

Active Listings: 81

Contingent Listings: 38

Pending Listings: 60 (33.5% of the inventory)

New listings: 12

Months of inventory: 3.9

Click here for the updated price per square foot chart.

We've been seeing a bit of a pickup in sold units in the past few weeks, which has moved that months of inventory number down. We're down just a little bit in active listings and up a bit in pending sales this week. It was another good week for new listings, with 12, and once again half of the new listings that came on the market were traditional sellers.

Come back later this week, and I'll have an update on short sales.

2010 First Quarter Update

We've already wiped out a quarter of this year, believe it or not. And as you'll see when you read what happened in the first quarter, it was an interesting, and somewhat crazy three months for the Lompoc real estate market. This might be a long post, so let's get after it. This first set of numbers here are combined numbers between the Lompoc Valley Association of Realtors MLS and the Central Coast Regional MLS:

We had 101 total sold units in the first quarter of 2010. Let's compare that to the first quarter of 2009. We had, uh, 101 sold units in that quarter as well. You have to like that kind of consistency. For even more consistency, we had an average price per square foot on our sold units of $144. As compared to the previous quarter when it was - that's right, you guessed it - $144. Click here for the updated price per square foot chart. I've been saying for a while that our market has stabilized. This kind of stuff makes me look like a regular genius. Really, I'm not just making this stuff up...

Our sales continue to be dominated by distressed properties. 60.4% of the first quarter sales were REO's, and 14.9% were short sales. Those numbers have shifted very slightly towards short sales. I expect that as this year rolls along, we will start to see an identifiable trend toward short sales. The overall percentage of distressed properties remains at right about 75%, which is very close to where it's been for the past few quarters.

From this point on in the post, we're going to be looking at numbers that come only from the LVAOR MLS - it's way too time consuming to try to combine some of these numbers:

Cash is king, and its realm is expanding. 25.3% of our transactions in the first quarter were all cash deals. 33.3% closed with FHA loans, 18.4% VA loans, and 23.o% conventional financing. Yes, you read that right - we had more cash deals than conventional loans in the first quarter. Great googly moogly! Conventional loans did come back up significantly from the 4th quarter of 2009 (12.9%), and FHA dropped off (49.5%).

Market times have been getting shorter, with a median days on market (DOM) of 22 for the quarter, compared to 26 for the previous quarter. Escrow times have remained pretty close to the same with a median of 43 days.

A whopping 65.5% of our transactions closed at or above the list price in the first quarter. This is up from 58.5% in the 4th quarter. If you'll remember, I talked about this in the 2009 Year In Review, and I had thought that it might have skewed more to the lower price ranges, but that turned out not to be the case. Looking at this quarter, that continues to be true. We had very nearly the same percentage on both sides of the median. And going back to those cash deals - it used to be that we talked about the "cash discount". And while it is a smaller number, 45.4% of our cash deals went at or above list.

I've been noting in the past month or two that we've been seeing more traditional listings, so I decided to take a good look at new listings coming on the market to see if it looks like things have been changing. We had 131 new listings hit our MLS in the first quarter. That was surprisingly up a fair bit from the first quarter of 2009 when we had 108 new listings (21.3% increase). Breaking them down, 35.1% of the new listings that came on in the first quarter of 2010 were REO's (compared to 43.5% in 2009). 27.8% were short sales (28.2% in 2009). That leaves 36.7% of the new listings for the first quarter of this year as traditional sellers, up from 28.7% a year ago. I'm still trying to wrap my head around how this is happening. I have a couple of half-formed ideas, but no real answers. If I have a "Eureka!" moment, I'll be sure to share it with you.

So there it is - in a nutshell, we're in a flat market in terms of value, as we have been for quite a while. We still have a lot of buyers in the market, and I think that we will continue to have them for the foreseeable future. We're still in a low inventory market, bouncing around a 4 to 4.5 months of inventory level, despite having an increase in overall new listings for the first quarter. We'll see where we go from here. Check back in regularly, and watch it with me.

One more thing...

I almost forgot something that I was going to tack onto this morning's post. Well, OK, I did forget it. Whaddya want at 6:30 in the morning? But at least I remembered this afternoon...

It has nothing to do with the Lompoc real estate market, but it's a topic that's near and dear. The Lompoc Valley Association of Realtors is putting on a fundraiser for this year's American Cancer Society's Relay For Life event. We're having a reverse drawing and spaghetti dinner on May 8th. A $50 ticket buys an entry into the reverse drawing, with a top prize up to $3000, and other smaller prizes at points throughout the drawing. It also gets you a spaghetti dinner for two, there will be a silent auction, a desert auction, and all kinds of fun stuff going on.

We have some tickets available, and if I run out, I can get more. Call me or email me if you'd like one (or more) and I'll hook you up.

Monday Morning Numbers 4/12/10

Is it Monday again already? I guess that means I need to get some more numbers out for you:

Active Listings: 86

Contingent Listings: 37

Pending Listings: 54 (30.5% of the inventory)

New listings: 17

Months of inventory: 4.3

Click here for an updated price per square foot chart.

We had a big jump in active listings this week, owing to 17 new listings coming on the market. That's the biggest week for new listings since last May. Once again, the majority of the new listings were traditional sellers, only 2 REO's and 3 short sales among those 17 listings. I've been watching this for a while now, and it would appear to qualify as a trend at this point. I have a couple of ideas about why this is happening, but I need to chew on it a little bit. It definitely flies in the face of everything that we've come to expect from our current market.

Later this week I'll get you an update on the first quarter of 2010. It's been an interesting quarter, to say the least. Make sure you check back in for that.

Focus on Mission Hills

This week, the wheel comes around to Mission Hills again. For a description of the area, go see my first post on it from last year.

We've had some very light activity up there in recent months. In fact, when I went to look for active listings up there in our MLS this morning, I found nothing. Not a single active listing. So I expanded the search to CCRMLS (you may recall from the 2009 3rd quarter update that I added that as a source for some stats). I usually don't look there for my neighborhood reports, because it usually isn't necessary, but when things are this thin, you look for data points everywhere you can. So now I can report that we have two active listings up there. One is a short sale, and the other is a traditional seller.

Boy, that was a long walk for two listings.

Since I've brought in CCRMLS for the active unite, I'll combine the rest of the numbers in for this report. We have 4 pending sales up there today, 2 short sales and 2 traditional sellers. And we've had two sales in the past three months, one REO and one short sale.

Where has all the activity gone? Part of the lack of activity is that it appears that distressed sales have been down in this area in recent months. That may be changing. I see 3 houses up there that have gone back to the bank but are not yet listed. Also, I can track 9 unresolved trustee sales and 3 default filings up there right now, so we may start to see a few more listings up here a little bit down the line. In any case, it appears that this area, like most of market, has been pretty stable for a while, with nicer homes selling at around the $200,000 level, and fixers going for 10-30% less depending on the condition.

Monday Morning Numbers 4/5/10

We're back, and our tans are already fading a little. Eight glorious days in the tropical sun. Oh yes. Now we just have to figure out when we can go again... Let's take a look at the numbers for this week:

Active Listings: 76

Contingent Listings: 38

Pending Listings: 53 (31.2% of the inventory)

New listings: 7

Months of inventory: 4.0

Click here for an updated price per square foot chart.

Our pending listings have dropped off a little over the past couple of weeks. But so have our new listings - we only had 6 the week we were gone and 7 last week. Out of those 13 listings, only 4 were REO's and 2 were short sales. When I do my first quarter update next week, I think that I'll take a good look at the new listings - it seems like it's been a pretty common thing to report a majority of listings as being traditional sellers lately.

Later this week I'll update Mission Hills, and like I said above, next week should be the first quarter wrap-up. I'm looking forward to breaking down the numbers for the quarter - I think we'll see some interesting trends developing.