Real Estate News for Friday, January 20th, 2006

Real estate market continues to cool. The real estate slowdown sped up in December, capping a year that some observers believe will mark the end of the historic home price run-up. Sales of new and resale homes and condos in the nine-county Bay Area dropped on a year-over-year basis for the ninth month in a row and at the steepest rate since November 2001, according to La Jolla-based research firm DataQuick Information Systems. The 15.5 percent decline is all the more striking since sales volume normally increases from November to December. The median home price rose year-over-year to $609,000, but the 14.3 percent increase was the slowest since March 2004. The December price was down 2.6 percent from November's record high of $625,000. The median price indicates that half the homes sold for more than that amount, half for less. "There's no question that we have moved from a seller's market to an equilibrium or even a buyer's market in certain cases," said Ken Rosen, chairman of the Fisher Center for Real Estate and Urban Economics at UC Berkeley. "The housing market has cooled." Click here to read more.

Call 3: Deceptive Refinancing Ads Targeting Consumers. Call 3 is warning consumers to watch out for advertisements that encourage refinancing to pay off holiday debt. After the holiday high from presents can come the holiday spending hangover from the bills. Some ads may try to take advantage of the situation, touting low-cost loans to manage the mess. One ad claims to lower payments up to 50 percent, with new rates as low as 1¾ percent. What the ad doesn't say is that the low rate likely lasts only one month and then it jumps. Click here to read more.

Chino dairies feeling squeezed. “Where Everything Grows,” the city of Chino’s motto, originally referred to its agricultural roots. Today it applies instead to growth in families, non-agricultural businesses and commercial and industrial complexes. Houses and business structures are going up at an astonishing rate. The Chino Valley was once home to more than 400 dairies and 400,000 head of cattle, and dairy cows were keeping pace with the human population. But that won’t be the case for long, with 70 percent of the remaining 140 dairies either sold to real estate developers or in negotiations. This shift in land use from agriculture to urban development is going on throughout the state, but none is more dramatic than the mass exodus currently taking place in the Chino dairyshed, where family farms have thrived for more than 50 years. Click here to read more.

S.J. rents relatively stable; apartments getting scarce. The apartments market is getting tighter in San Joaquin County, but rents are only creeping up, according to the latest quarterly survey by RealFacts, a Novato real estate firm that tracks the apartment market. Click here to read more.

Rents in San Francisco area rebound after 4 years of decline. The survey also showed that apartment rents rose throughout most of the West last year in the latest sign that landlords are slowly regaining pricing leverage. The biggest increases were concentrated in southern California and southern Nevada, where the regional economies generally have been stronger than other parts of the West. The market spanning Los Angeles and Orange counties demanded the West's highest rents, at an average $1,459, a 6.6 percent increase from 2004. Tucson, Ariz., offered the lowest average in the West, $616, down 1.4 percent from 2004. Click here to read more.

SoCal new-home price gains expected to cool. Market report shows growing sales, inventory. Demand for new homes in Southern California remains stable and average prices have been flat for the past year, according to a market report by Real Estate Economics, a real estate information company. The fourth-quarter 2005 market report, which includes data from Ventura, Los Angeles, Orange, San Diego, Riverside and San Bernardino counties, shows that total inventory of new homes for sale is up about 15.9 percent, while monthly sales are up about 29.4 percent since fourth-quarter 2004. The pace of new-home sales throughout Southern California was 9,226 sales per month in fourth-quarter 2005, with an average sales rate per new-home development of 7.3 sales per month. While inventory has risen, the months' supply of inventory has dropped 10.4 percent from fourth-quarter 2004 to fourth-quarter 2005 based on the pace of sales and the construction of more new-home communities, Real Estate Economics reported. The average of minimum lot sizes in new-home developments dropped 9.2 percent from fourth-quarter 2004 to fourth-quarter 2005, falling from 7,148 square feet to 6,490 square feet. While average new-home prices have been roughly level during the past 12 months, the average price per square foot, at $266.77 in fourth-quarter 2005, increased by 5.5 percent in that time, the company reported. The average base price of new homes in Southern California was $634,836 in fourth-quarter 2004, and increased 0.4 percent in fourth-quarter 2005 to $637,629. "This trend of only modest to moderate new-home price appreciation is likely to continue in most areas of Southern California. New-home price appreciation will continue at much lower levels during the next few years due to the impact of the already high level of new-home prices, slowly rising mortgage interest rates, increasing competitive supply and only moderate economic growth," the market report states. "New-home demand remains intense, but prices have finally brought the new-home market into balance, resulting in much more normal market patterns during the next year." Click here to read more.

~Tina Jan~
Coldwell Banker Kivett-Teeters
1655 E. Sixth St.
Beaumont, CA 92223
Work: 951-845-5520 Ext. 105
Fax: 951-845-4916
Cell: 909-446-2666
Toll-Free: 1-877-TINAJAN
tina.jan@coldwellbanker.com
www.tinajan.com