Orange County Active Inventory

Since the start of the year, the record low inventory has only increased by 47 homes.

The active inventory will not budge. In the past two weeks, it has increased by 25 homes and now totals 3,208. It has been bouncing around the 3,200 market for the first few months of 2013. Since tracking the market nine years ago, these levels are drastically less than the prior record levels established in March of 2005 at 4,912. To say that the current active inventory is low or anemic is an understatement. It is almost impossible to convey just how ridiculously low the levels are for comparison purposes. The inventory is simply unprecedented and does not show any signs of letting up.

Last year at this time, there were 3,407 additional homes on the market and they were flying off the market. With buyers on the sidelines waiting for new inventory to hit the market, pent up demand is astronomical. If there were an additional 3,400 homes on the market today, they would sell almost overnight.

The real issue is that the housing market is in transition across Southern California and across the United States. Distressed homes have faded as the market recovers and more equity sellers place their homes on the market. Thus far in 2013, there have been 1,094 short sales listed for sale thus far in 2013, down from 2,838 during the same timeframe last year; that is off by 1,744. Similarly, there have been 334 foreclosures listed for sale so far this year, down from 1,095 last year, a 761 home difference. The only increase has been in equity sellers. There have been 7,800 homeowners with equity in their homes opt to enter the fray thus far this year compared to 6,604 in 2012. There just have not been enough equity sellers to overcome the loss in distressed listings this year. Overall, there have been 12% fewer homes placed on the market in 2013 compared to 2012.

Demand: With not enough new inventory, demand, as measured by pending sales, dropped by 2%
In the past two weeks, demand, the number of new pending sales over the past month, decreased by a negligible 69 homes, and now totals 2,811. Compared to last year at this time, there are 1,029 fewer pending sales today. Until more homeowners realize how much homes have appreciated and are more apt to sell, demand will remain muted compared to last year. Distressed homes have faded and equity sellers have been slow to replace them.

Distressed Breakdown: the distressed inventory remained unchanged over the past couple of weeks.
Within the past two weeks, the distressed inventory, short sales and foreclosures combined, dropped by 2 homes, virtually unchanged, and now totals 224. Only 7% of the active listing inventory is distressed and 18% of demand. Compare that to last year when it represented 28% of the inventory and 49% of demand, more proof that the market is in transitioning away from distressed sales having such a tremendous impact on housing.

Written by,
Steven Thomas

HOMES FOR SALE IN LOW SUPPLY

As spring buying season starts, prices likely to keep rising

The supply of homes for sale is still unusually tight as the spring buying season opens, turning up the heat on already- rising prices.

The number of homes listed for sale on real estate website Zillow was down almost 17% in late February vs. a year earlier. In some California markets, it was down more than 40%.

The supply crunch is likely to last all year, says IHS Global Insight economist Patrick Newport. “We’re still not building enough homes.”

The U. S. is creating about 1.1 million new households a year, but housing starts in January came in at an 890,000 annual rate, the government says.

As prices rise, though, more owners will be motivated to sell, easing supply shortages, economists say. The tight inventory is a big driver of rising prices.

Home prices were up 7.3% in the fourth quarter from a year before, Standard & Poor’s Case- Shiller data show. That was much faster than most economists expected for 2012.

Nationwide, the supply of homes for sale — based on the pace of sales — fell in January to 4.2 months, the National Association of Realtors says. That’s an almost eight- year low. A six- month to seven- month supply is considered balanced between buyers and sellers.

The availability of the most expensive homes in the markets Zillow tracks has tightened more than those at lower price levels.

Homes for sale in what Zillow defines as the top price tier in each market fell by almost 21% in February vs. a year earlier. The inventory of homes in the middle tier dropped 17%; those in the bottom tier fell 9%.

Five California cities in Zillow’s survey are among those seeing the biggest inventory drops, from a 48% decline in Sacramento to a 36% falloff in Riverside. Other cities are also seeing significantly fewer listings. New York is down almost 19%; Dallas/ Fort Worth, nearly 21%; and Orlando is off 27%.

Only five of 99 metros showed an increase in listings, led by El Paso, up 19%, and Albuquerque, up 8%. Little Rock, Fort Myers, Fla., and Youngstown, Ohio, also saw increases.

Written by Julie Schmit USA TODAY

Ways to save for a new home

A home is often the biggest investment most people will make in a lifetime. Saving for a down payment can be a lengthy and disciplined process. Taking advantage of federal tax incentives and low interest rates are great ways to reach your goal of owning a home. Here are some small ways that can really add up to big savings.

1. Make coffee at home instead of buying a daily brew. Prices on lattes, coffee and espresso have gone through the roof.
2. Eat at home instead of going out. When you dine out, consider lunch instead of dinner and avoid purchasing alcohol at meals.
3. Consider taking on a roommate or smaller apartment to cut down on rent.
4. Eliminate extras like premium cable, expensive DVD rental plans, and excessive cell phone plans.
5. Use coupons at the grocery store and look for sale items. Shop for groceries and household cleaners at retailers that offer major discounts on items sold in bulk.
6. Cancel your overpriced gym membership fee and work out on your own.
7. Program your thermostat so heat is lowered at night or during the day when occupants are not home. Turn off the lights when you leave a room and use fans instead of air conditioning to keep your electricity bill low.
8. Carpool to work, buy low octane fuel and avoid taking costly taxis.
9. Purchase generic medications and toiletries instead of brand names, often, the same active ingredients are used and the items are a lot less expensive.
10. Pack a sandwich and bring it to work. Work lunches and office take out can be a drain on your budget.