Archive for May, 2009
We Got What We Wished For….It Isn’t Very Nice!
May 24th, 2009 Categories: Weekly Real Estate Activity In Ventura County
My musing for the past several weeks.
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California voters (small number) decided enough was enough. Politicians on the other hand have concluded that voters don’t know what they want so “enough is enough” probably won’t fly. The next step is to replace the politicians. We did that by replacing Gov. Davis a number of years ago basically because of increased DMV fees. Well guess what….we not only have increased DMV fees but a lot of other fees. We also have to manage the activities of the non-elected deal brokers.
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Is California going to be the 1st State to declare bankruptcy?
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It appears that the brightest are leaving California. It is also being talked about that our school system is in the toilet. Funny how people outside of California have seen this, the general population has seen this but the politicians and teacher unions have not. Hmmmm….a pause here.
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I also see the blame game setting in. A number of reporters are starting to say that the voters are the culprits for the problems in California. The initiatives that have been passed over the last 10-20 years were not thought out by the voters who “want things but do not want to pay for them”. Well part of that is true but what isn’t being said is that these same newspapers made recommendations which many voters followed. Many voters think that newspapers are above the fray and make their recommendations based on what is good for society. Well it’s the dumb following the dumber.
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Ms. California stuck to her beliefs (whether you agree or disagree with her) which is a strength that many of us have given up. Look at the current situation. When the current administration speaks all others fall in line…..money is such a strong tool. The only thing that is piling up higher is the BS we are getting from Washington.
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Talking about blame game…..the Washington day time drama is a reality sage. He said, she said! Torturing….I didn’t know; I wasn’t told…..what are these people there for. Lots of excuses. Definitely need replacements in Washington at all levels of Government.
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Talk about adding to the stress. A number of lenders will now verify appraisals 3 days prior to the Note date and require the borrower to sign the HVCC Disclosure-Appraisal Notification and Acknowledgement. Yikes what does the seller do if they disagree with the appraisal. I can see “out of area” appraisers continuing to slam local values. I can also see a large number of law suits.
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I haven’t seen much in capping salaries of late. I wonder why? Hollywood stars, sport figures, television news casters, anybody making over $ 250,000 per year……what are they thinking? Cap and tax……could it be????????
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I see that my home State (New Jersey) finally has the lead in something (speeding tickets). Based on the article http://articles.moneycentral.msn.com/Insurance/InsureYourCar/Worst-states-for-drivers.aspx and the chart created by the National Motorist Association listed below are the worst to best States for speeding tickets. So Jersey travelers be on the alert. I was surprise that California was not in the top 5 States, but give them time….they will get there.
National Motorists Association rankings, from worst to best:
| Rank | State | Rank | State | Rank | State |
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| 1 | New Jersey | 18 | Florida | 35 | Hawaii |
| 2 | Ohio | 19 | Pennsylvania | 36 | Arkansas |
| 3 | Maryland | 20 | North Carolina | 37 | Alaska |
| 4 | Louisiana | 21 | Alabama | 38 | Kansas |
| 5 | New York | 22 | Rhode Island | 39 | Mississippi |
| 6 | Illinois | 23 | West Virginia | 40 | Wisconsin |
| 7 | Delaware | 24 | New Hampshire | 41 | Utah |
| 8 | Virginia | 25 | Arizona | 42 | South Dakota |
| 9 | Washington | 26 | New Mexico | 43 | Indiana |
| 10 | Massachusetts | 27 | Missouri | 44 | Minnesota |
| 11 | Colorado | 28 | Texas | 45 | North Dakota |
| 12 | Oregon | 29 | Oklahoma | 46 | Kentucky |
| 13 | Tennessee | 30 | Nevada | 47 | Nebraska |
| 14 | California | 31 | Georgia | 48 | Montana |
| 15 | Michigan | 32 | Connecticut | 49 | Idaho |
| 16 | Vermont | 33 | South Carolina | 50 | Wyoming |
| 17 | Maine | 34 | Iowa |
- From the perspective of one economist the recession may be over.
As bad as it seems today, according to Robert J. Gordon, an acclaimed macro-economist and professor at Northwester University, we’ve lived through worse, and not all that long ago.
It was a lot worse in 1981-82, too, because the size of the work force was smaller then. So the same number of claims represents a larger percentage. Adjusted for the size of the work force, today’s claims are just a little more than half of what they were at the 1982 peak. The recession? It’s over! Read the following article which the author researched to verify his agreement with the professor. Interesting reading. http://articles.moneycentral.msn.com/Investing/Extra/the-recession-it-is-over-economist-says.aspx
One thing jumps out of the chart that has nothing to do with Gordon’s indicator — the fact that in this recession, we still haven’t exceeded the number of claims in the 1981-82 recession.
The National Real Estate Market.
The areas that have been my focus for investments have fared rather well during this real estate down turn (Oklahoma, Louisiana and Texas (although Texas has had more damage occurring over the last several months).
The latest Federal Housing Finance Agency report show that these States (shown as West South Central) as having a negative appreciation of -0.5%. The other sector (East South Central which I also like) had a negative appreciation rate of -3.0%. California (the Pacific area) is experiencing a -22.1% negative appreciation.
Ventura County Real Estate.
Things are looking brighter and the market is getting stronger.
Mentioned a number of times is the jack-in-the-box scenario that is forming now.
Listings have decreased significantly over the last 18 months (from 5,250 in November 10,2007 down to 2,069 as of May 23, 2009: approximately a 50% decrease).
Sales in Ventura County have increased 32% in 2009 compared to the same comparable period of 2008.
This year there have been 2,852 sales for the period January 1 through May 23, 2009; for the same period in 2008, there were 2,161 sales.
There is a squeeze occurring. We have a commodity (homes) and there is a pent up demand for this commodity and as soon as the jack-in-the-box is opened prices will accelerate big time.
Ventura County areas that are now seller markets consist of Simi Valley/Moorpark, Ventura, Oxnard, Camarillo, Santa Paula, and just recently Fillmore.
Areas that remain buyer markets consist of Santa Rosa Valley, Ventura Beaches, Oxnard Beaches and the Ojai/Oak View area. Conejo Valley is neutral.
For Ventura County the plot thickens. Unemployment and job creation will be necessary to see a healthy real estate market. The market will start to go up but the pace of the upturn is dependent on jobs and a decrease in unemployment. If jobs continue to lag and unemployment increases or stays high the market will go side-ways for a period of time but the bottom (in general) has been set.
Comments are welcomed.
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People Are Talking….
May 10th, 2009 Categories: Weekly Real Estate Activity In Ventura County
On this Mothers Day it 
appears that real estate is a good topic to talk about since the indicators now have been accepted by the media.
Good press from news outlets is also creating positive vibes for the market.
To be sure the politicians will play the game but when push comes to shove they had little to do with the change in direction.
The market would be doing the same with or without them. One should be concern that the politicians will once again stick their nose into the system and screw things up.
The good intentions of a home in every pot did not work out. In fact a great many people have been hurt with this political folly. But intentions aside the system is going back to hard nose business basics and this will continue for several more years and then the follies will start over again.
There will be some significant economic events that will slow the market but it will not create a free fall as had been the case over the last few years.
Economic events that will slow the market:
- gasoline will go back up to $ 4.50 or higher. Throughout the World and in the United States, oil people are not drilling, plant capacity increases have been shelved.
- Food prices will sky rocketbecause of ethanol and less planting in the farm land. Politicians know this is a folly but want to continue the folly to satisfy constituents and save face. Ethanol has been shown to be a pollutant but the folks in Washington have too much invested to yield to common sense today.
- Environmental costs (cap and trade) will be a hideous tax on the United States with most other Nations giving lip service but basically by-passing this issue.
- California is going to the brink of bankruptcy. It’s a matter of wills but Sacramento will realize that unless significant cuts are made they will be out of a job.
The National real estate market will continue to plod upward because States and local agencies need to have real estate do good to collect taxes.
Ventura County.
The Ventura County real estate market as evidence by the table below is doing well. There will be hiccups but it appears that the base has been settled. We should continue to witness an increase in sales but it will take a little longer for prices to start upward. One will see sales continue to make a V shape configuration while prices will follow a U shape configuration for the next several months.
This table also notes that the Simi Valley/Moorpark, Ventura, Oxnard, Santa Paula and Fillmore areas as seller markets. The Conejo Valley and Camarillo are neutral and the other areas (Ventura Beaches, Oxnard Beaches and the Oak View/Ojai) are buyer markets.
Overall the County is a neutral market and has an average 4 months inventory.
Unemployment and the lack of job creation in the County will cause a side-ways motion until the last quarter of 2009.
Job creation is going to be a zinger. Large and medium size businesses will be facing significant increases in employee health care and taxes. This does bode well for job creation. Visit My Musings Of The Week and I think you will get a sense of what is in store.
What may help is the significant increase in sole proprietor-ships and federal, state and local governments hiring.
However the public sector is over weighing the economics of scale and eventually there will be a drastic decreases in head count as time marches on.
The general public and the private sector will not be able to shoulder the burden and all sort of changes will take place which will not be very pleasant for a lot of people.
Expect big changes in educations and State government headcounts. The tea party is set to begin.
This next chart (below) shows the distribution of single family residential sales in the County for the period of January 1, 2009 through May 9, 2009. Approximately 25% of the homes sold in the County in this time period fell into the price range of $ 300,001 to $ 400,000. 65% of all single family homes sold in the County was for $ 400,000 or less.
75% of the homes sold in Oxnard were below $ 300,000; 82% of the homes sold in Fillmore and Santa Paula were below $ 300,000. These communities accounted for 37% of all sales in the County for the period ending May 9, 2009.
Periodically I will update this chart but I suspect significant changes towards the upper price ranges towards the latter part of this year.
The projection that had been made last September, 2008 http://www.venturacountyretalk.com/2008/09/07/ventura-county-real-estate-doings-for-week-ending-september-6-2008/ appears to be on track.
Illustrated in the September, 2008 article was the Ventura County Forecast through the year 2022.
As noted it is expected that the previous highs (2003-2005) will be exceeded by at least 50% or more in Ventura County. Those living within 25 miles of the ocean can expect higher appreciation.
As mentioned earlier the U configuration price jumps will really show up around the year 2014 and then watch out.
There have been many homes withdrawn from the market place over the last several years waiting for better prices. Listings have continued downward so in effect what is happening is a “spring” effect will take place allowing prices to surge upward as shown above. Standard economics 101, supply and demand.
Your comments are welcomed.
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My musings of the week!
May 8th, 2009 Categories: In Case You Missed It---
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Swine flu. There was talk that we should close the border because of this flu. Why can’t the border be closed to stop illegals entering the country or to stop drugs or arms. I wonder if our political people are talking with a fork tongue? Bully Pulpit. It is interesting reading to see the steps being taken in schools to minimize bullying amongst students. Various penalties are imposed including dismissal. When the bullying occurs from the White House what are the penalties being imposed? Certainly our press corps has been very quiet regarding the bully bully activity going on in this Administration. It sets the stage for other Presidents to do the same or more. If it is decided by some President that the press should write things as determined by Washington, I wonder if the press will be more vocal then? Well I am certainly out of focus….this is being done already. Interesting don’t you think? From all indications it appears that this Administration and Congress want all people teetered to the whims of the government. This appears to be the same attitude of State governments and local governments. There is an attitude that people must live in fear simply because a few lunatics want to take over the way we live. If you object to this, look in the mirror because you may be the reason it is happening! To make the point. I live in a small town. A lady wanted to build herself a restaurant but the City Planners made her add retail shops (I suspect it for the best use of land, etc). A similar action was taken with an individual who wanted to build an apartment complex. They had to add retail shops. In this second case none of the shops are occupied and haven’t been since the complex was built about one year ago. Who is responsible for keeping these shops occupied and is this lady or the apartment builder being re-reimbursed for something they do not want? I do not think so and if they are why isn’t it public policy to tell the citizens what is being done and why. General Motors. I cannot believe I heard this. Since the Union has basically taken over General Motors there is the consideration that many of the GM cars will be built overseas. Excuse me….what happened to “built in the USA” fan fare. Management looks for the cheapest way to produce and stay competitive. Political Dismay. California politicians are besides themselves seeing that the various measures being proposed appear to be losing. Well being honest in the beginning may have been the better course of action. So why politicians think (based on what has happened in California over the last 10-15 years) that we should believe them today is beyond me. When our friends in Sacramento see money that is an open invitation to spend. As far as they are concern, everyday is a rainy day. What we should do is replace all of them and start fresh. Let’s take the steps the Federal government took with General Motors CEO. The Federal government got rid of him. If it is good to take this action in the private sector why not the public sector. Keep replacing until we think we have the right one’s in office. We will get it right one of these days. Today politics appears to be a criminal activity at all levels. Grade Schools. I see that PE is changing drastically in grade school. It appears that competitive sports is being down played, being replaced with activities that has no winners or losers. That appears to be the template for our schools overall. There are never any winners or losers. I heard it said (Peter Drucker) that he thought the school system in the United States will unravel which it appears now to be doing. Just read the papers to see the hoops that one has to do to fire incompetent teachers. ID Risk Level. You may surprise yourself. I received this from a young lady in Illinois. Find out your test score and see if you have to take some action to protect yourself.
How Did You Score?
If your score is Very High Risk, hire and pay a legal representative, security personnel, CPA, and whomever that will monitor and protect you and your family 24 hours, 7 days a week from being a victim of ID theft or simply contact John Duffner at johnduffner@hotmail.com and ask what is available to give you some means of protection at a reasonable price. Kids Names: Another item that interested me are baby names. Here is a listing of the top ten boy/girl names based on 2008 statistics:
The Top 10 names for baby boys:
I lost a friend. He was a shoe maker, very outspoken, but very good hearted. He and I at times would exchange stories of our experiences with heart surgery since we both were operated on within months of each other. Or we regaled each other with stories of what we did in the service (he was Army; I the Marines) and what our kids were doing. When Jess lost his wife a few years ago it took the spring from him but he remained occupied, always opening the shop, and I would stop by to complain about nothing. He will be missed. Your comments are welcomed. |
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