Ventura County Real Estate Doing’s for Week Ending August 2, 2008
August 3rd, 2008 Categories: Weekly Real Estate Activity In Ventura County
Yikes it happening Big Time.
The gauntlet will fall. It is just a matter of time.
Government is now growing closer to being the ultimate arbiter of how Americans (you) borrow, lend, distribute and deploy money.
Add to this the “fears” that we constantly listen to or read about:
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you can eat this but not that;
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in some places of the country people are being told what size home they will be allowed to build;
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we are being told that certain language and words are not allowed (but some peoples can still use various “not” words but “us” others can’t. You figure it out.);
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we are being told what automobiles will be driven;
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we are being told what we can wear and what not to wear;
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soon we will be told where we can live and with whom;
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and don’t breath because your CO-2 creates a problem with nature (earth warming);
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and it continues.
I must have fallen off the turnip truck but things are really getting out of whack. And you may ask “pray tell what does any of this have to do with real estate.”
In one word: Lots.
The elected and not elected (the gray forces who are always in office despite who is elected) peoples in Federal and State governments feel that they know what is best for all of us.
All of this is interesting and I suspect the talk we hear and the print that we read are the required preliminary steps to justify TAX INCREASES at all levels of government.
Due to governments short falls in revenue one should expect healthy increases in both real estate taxes, sales tax and other political “fees” that are slipped into the system. And it goes without saying that there will be significant personal and business Federal and State tax increases regardless of who is elected in November.
With inflation just around the corner interest rates most certainly will go up bedeviling everybody and everything. It is quite possible that we will re-live 16% home mortgage rates with all the help that Washington is giving.
This is government at work: they spend; we pay.
An aside comment. I either was told or read that approximately 51% or more of the working population in California are employed by some Federal, State, Regional or Local government agency. If true that is a lot of people and the prospects of an advancing economic economy may be stymied.
Back to the national picture.
A recent article by Jon Markham (via MSN Money) entitled, “Is Market ‘fix’ Tomorrow’s Crisis” suggest yes. David Kotok of institutional fund manager Cumberland Advisors told clients this week, the “seeds of the next crisis are being sown right now” as a set of presumed fixes create unexpected consequences. He is making reference to the Freddie Mac and Sallie Mae fixes that Washington has instituted.
Hazarding a guess, Kotok suggests the next crises may emerge in federal guarantees as private entities are let off the hook for their obligations. Beware of stresses that the new era will place on the Federal Deposit Insurance Corp., which is responsible for faltering banks’ deposits; the federal Pension Benefit Guarantee Corp., which is responsible for making good on companies’ unfunded pensions; and the Securities Investor Protection Corp., which is responsible for making good on brokerage customers’ cash losses. No one really knows whether they have the funds to carry out their missions.
But we may not be alone. Here is a headline from the Guardian (a British newspaper): ” House prices continued to fall in July, recording their largest year-on-year drop since the property market crash of the early 1990s, figures from Nationwide building society showed today.”
Overseas real estate is slightly behind us in the scare headlines. The Unites States press are now beginning to show that real estate is becoming positive, ever so slowly.
Back To What I Know…..Ventura County Real Estate.
Looking at the monthly summaries it is evident that from month to month home sales continue to increase; days on the market for sold homes is decreasing; the average list price and eventual sales price for sold homes continues to decrease; the variance between list price and sales price has flattened; and inventory has dropped dramatically since the beginning of the year (from 15 months to 5.8 months).
75% of homes sold last week in Ventura County were below $ 500,000.
Not shown in the chart above and a pattern that is just now developing, it appears that sellers are beginning to increase home prices.
Again the numbers are small but when one includes the multiple offers that some properties are now getting it appears that Ventura County home prices will now start to rise.
Sellers will now expect more for their properties.
So it appears that the downside of the market has been set and completed and over the next several weeks the overall market will start showing property values rising.
It is expected that Ventura County properties will appreciate approximately 8% in the next 12 months.
National economics can put a dent in the growth pattern for Ventura County but the overall economy has to really take a hit before it is reflected in the County.
We do have one thing in Ventura County which very few people have. When things get out of sorts we can always take time to walk the beach.
Your comments are welcomed.
