Engineering Fear. Ventura County Real Estate Doing’s for Week Ending Nov 1, 2008
November 2nd, 2008 Categories: Weekly Real Estate Activity In Ventura County
From all the talk on the National level there has been little done to help the housing side of the economy. And this should not be a surprise to anyone.
The Federal Reserve has done its thing but the banks have yet to pass rate reductions to the consumers. As stated lots of talk but little to no action.
There is still a disturbing principal that must be dealt with.
There is a significant portion of the population (and politicians) that think that being an American gives them a right to a home (sharing the wealth concept).
Politicians engineered and set in place this thought in the 1990’s (today’s Fannie Mae and Freddie Mac problem) that every pot should have a home. This is still the thinking in Washington and unless corrected it will have a significant impact on the real estate market.
Do not be surprise that this thinking will not continue with anyone wanting a home, getting one, even if they cannot afford it.
What will occur is that the Government will assist those who cannot afford the monthly payments with monies to bridge the deficiency. Meaning the citizens of the United States will pay the cost of the Governments generosity.
This was further highlighted when listening to the radio a few days ago a number of people in the street were being asked questions. Listed below are the questions asked as I remembered them and at this writing I cannot recall the radio station that was conducting this interview but it was scary.
I thought at first it was a Halloween trick but after listening to a half dozen people responding to the questions it was apparent that the this was the thinking on the street with these people.
The questions and responses were:
Do you have a right to a home even if you cannot afford it? Response: Yes.
Question: Should the Government help or give you a home? Response: Yes.
Question: Do you you think the Government should give you a car to go to work and the like. Response: Yes.
Question: Do you believe that the Government should give you monies for your food, clothing, medical care and entertainment?
Response: Yes.
There were some other questions asked but this is what I remembered. Perhaps someone reading this heard the same program and can shed further light on the topic but it was un-nerving to hear and picture social engineering being addressed.
Ventura County:
The market continues to strengthen with listing decreasing at a faster pace (this I perceive as the “Stay Put” syndrome); days on the market is now decreasing (this I contribute to people wanting to buy quickly before they miss the opportunity. They sense the market has worked itself to a bottom); and the discount between the list price and actual sales price has stabilized to about 4%.
Ventura County inventory can be described as normal (at about 5 months. This still can be described as a neutral market but with listings decreasing as a rapid pace one will start witnessing a turn around to a sellers market very shortly).
Viewing the market on a month to month basis one can see that inventory has dropped dramatically since the beginning of the year. Also the equity (value loss) of homes has dropped significantly in a year to year,month spot comparison. Equity has begun a turn around and as noted on the above chart, Ventura County should experience approximately a 7% annual growth over the next 12 months based on current prices. This growth will continue to approximately 25% over the next three years. Then watch out. Ventura County home prices will sky rocket. Nice to live along the coast.
A preview of what should occur over the next several years is depicted in the following graph. Again it is nice to live near the beach and in Ventura County.
Your comments are welcomed.
