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Real Estate - Market Time Report for Nov 2nd

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  • Real Estate - Market Time Report for Nov 2nd

    Okay, the latest one is out! These reports are issued once every two weeks by my company to keep us up to date on current market conditions.

    As always, if you're looking to buy or sell a home in Orange County, I am happy to help. You can contact me via PM or through the links in my signature.

    Market Time Report: Holiday Distractions

    November 2, 2006

    Good Afternoon!

    In the past four weeks, demand has remained steady. 1,987 homes were placed into escrow within the prior 30 days, a drop of only four homes in four14,7297.41 months. Now that the Holiday market has officially kicked off, we can expect demand to slowly decline as more and more homes are pulled off the market to enjoy all of the distractions of the holidays. Attached homes and detached homes are now experiencing similar market times. The market time for attached homes has dropped in the past four weeks from 8.18 months to 7.58 months today, while detached homes have changed very little, 7.39 months four weeks ago compared to 7.30 months today. The number of active listings that are vacant has not changed. 33.5% of all active attached listings are vacant compared to 24.8% for all active detached listings. Overall, 28.2% of all active homes on the market are vacant. Many of these owners are attempting to lease their homes while pursuing a buyer willing to purchase. They are banking on one or the other occurring in the short term.

    A year ago, the active inventory was at 8,259 homes, 6,470 fewer than today. Demand, the number of homes placed into escrow within the prior 30 days, was at 2,750 homes a year ago, 763 additional escrows. Market time had been steadily increasing and arrived at the three month mark on November 3, 2005 for the first time in 2005. The inventory continued to climb, until it eclipsed the four month mark at the end of December. Demand dropped from the 2,750 home mark to 1,807 homes placed into escrow within the prior 30 days on December 29th.

    In taking a close look at price ranges, it is obvious that the higher the price, the more competitive the market for sellers. The various price ranges tell the biggest story. For homes listed above $1 million, the market is extremely slow. Above $1.5 million, market time is in double digit territory, meaning very few sellers are achieving their goal of placing their home into escrow in the course of a month.

    What can we expect for the rest of the year and the beginning of 2007?

    How should a seller approach the market? Basically, it all boils down to MOTIVATION. Sellers who are not motivated should pull their homes off the market and enjoy the season. PERSPECTIVE is also very important. Most sellers are sitting on a mountain of equity. When a seller realistically prices their home, it is true that they may not get as much as a neighbor did ten months ago, but they have still realized a tremendous gain after years of appreciation. The right PRICE is also essential in achieving success. Painstakingly analyzing recent comparable sales and escrows and taking into account aggressively priced sellers will allow a seller to arrive at the proper price. PATIENCE is very, very important going into the Holiday market as well. Even though a seller is motivated and their home is priced right, there is NO GUARANTEED SALE

    How should a Buyer approach the market?extremelyown a home. A home is not just a commodity, it is where people live out their lives and raise their families. In addition, buyers can take comfort in the fact that a Southern California home located in Orange County is an excellent long term investment. In 5 to 10 years, the real estate market will be better than today.

    The following areas have inventories of less than six months: Aliso Viejo, Cypress, Foothill Ranch, Fountain Valley, and Talega.

    The following areas have inventories between nine and ten months: Buena Park, San Clemente and homes between $1 million and $1.5 million.

    The following areas have inventories greater than ten months: Canyon Areas, Corona Del Mar, Coto de Caza, Dana Point, Laguna Niguel, Laguna Woods, Newport Coast, Villa Park and all ranges above $1.5 million.

    Unusually and exceedingly peculiar and altogether quite impossible to describe...

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