Housing a Mixed Bag. Boom time fades away as market gets sluggish. Sales of previously owned homes edged up in March, but the backlog of unsold homes still hit a record high, raising concerns that the once-booming housing market could be in for a rougher landing than expected. The California Association of Realtors reported Tuesday that California's inventory of unsold resale homes in March declined from February, as the traditional home-buying season kicked in. However, sales cooled from the hyper pace of a year ago. Statewide, the median home price increased 13 percent from March 2005, while sales dropped 15 percent. The number of unsold homes on the market at the end of March hit a record of 3.19 million units. At the March sales pace, it would take 5.5 months to eliminate the backlog of unsold homes. Some analysts expressed concern that the rising level of unsold homes would soon start putting more downward pressure on home prices. Click here to read more.
Rates on 30-year mortgages climb. Rates on 30-year mortgages climbed this week, hitting their highest point in nearly four years, a development that will be weighed by people thinking about buying a home or refinancing the one they own. This week's rate was the highest since the week ending June 20, 2002, when 30-year mortgage rates stood at 6.63 percent. Click here to read more.
Mortgage Defaults Rise in State. The number of notices sent increased in the first quarter to the highest level in more than two years. The rate of change in the six-county Southern California region was higher. The number of defaults rose 33% year over year to 11,102 from 8,330. San Diego and Riverside counties saw the biggest jumps in defaults, more than 50%. The notices serve as an early indicator of possible foreclosures and signal a shift in housing market trends. With slower appreciation, some distressed homeowners may find it harder to sell their homes for more than they owe their mortgage lenders. Still, the first-quarter increase is far below the record set in 1996, when 59,897 default warnings were delivered, according to DataQuick, which has been keeping track since 1992. Typically, about 5% of homeowners who receive default notices end up losing their homes to foreclosure. Click here to read more.
Welcome to the dead zone. Real estate survival guide: The great housing bubble has finally started to deflate, and the fall will be harder in some markets than others. Five years of superheated price gains rescued America from stock market collapse, put billions in consumers' pockets, and ignited a building boom that bolstered the nation's economy. But it's over. The great housing bubble has finally started to deflate. Contracts are being canceled, deals are drying up, prices are starting to drop. The psychology is shifting even as thousands of new homes and condos join the for-sale listings each day - so the downward pressure will only get worse. "The buyers' sense of urgency is gone," says Bob Toll, CEO of luxury builder Toll Brothers (Research), who has long been a housing bull. "They see the market going soft, so they stall." In California it now takes six months to sell a house, twice as long as a year ago. With houses hovering beyond the reach of most potential purchasers, formerly frantic markets grow eerily calm. People who rush to list their homes, hoping to grab a fat gain just before prices break, take them off the market. Sales shrink as buyers float low-ball offers, and sellers refuse them. Realtors and mortgage brokers find other jobs. The bubble areas turn into Dead Zones. Click here to read more.
The case for rental revival. Rentals are not only showing signs of life for the first time in years, but demographic and economic indicators point to an improved rental market for the next decade. Vacancy rates are slowly declining, which is, of course, good for landlords, but the rents are going up only modestly, which is also good for landlords but at the same time not detrimental to tenants. Demand is increasing at the same time that supply is stabilizing, so it's good for everybody. Despite the exodus to homeownership, fully one-third of American households (34 million) reside in rental housing, according to the JCHS. That figure has remained remarkably consistent during the past decade as the influx of immigrants replaced those who bought their own homes and the conversion of rentals to condos helped offset new construction, primarily in the nation's suburbs. 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
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