Inventory dropping!

Barring any major increase in home interest rates or unforseen global incidents, I would have to say that in my opinion all indicators are pointing to a leveling out of the "down swing" in home buying activity, and we are fiinally poised for an upswing. While this blog is only referring to the Northern Los Angeles County real estate market such as Santa Clarita, from what I can tell, the worst is over in quite a few markets that have already taken a beating ('beating' might be a bit much, it wasn't that bad).

The inventory of homes currently on the market in my neck of the woods is 2200. This represents a steep decline from only a few months ago where Santa Clarita reached approx 2800 homes on the market. While some have taken their homes off the market so as to not be inconvenienced during the Holidays, others have been selling. Listings are finally selling, as sellers have conceeded that their original list price was simply not realistic in this market. After the average seller implemented several price decreases and endured 2-6 months of being on the market with out an offer, finally, the offers are coming in.

As the inventory hopefully lowers to below 2000 in the coming months, this will create a slightly tighter inventory heading into the Spring of 07. So many sellers put their home on the market in the second half of 2006, I don't see ALL of them, or even half of them coming back and trying a second time. So that will tighten the supply, and buyers will have less choices as they did in 2006. Less choices could translate in prices staying stable/flat which will be welcome after most lost approx 5% of their values, and hopefully another round of price appreciation will ensue for those of us that are homeowners.

There is no economic data to sustain a downturn in homebuying. I know first hand people are buying! I've had a great 3rd quarter helping them do so. Prices did however need to deflate a certain percentage in order to allow buyers pocket books and confidence to catch up with the enormous increases of the previous 4-6 years. I can't wait for the attention to focus more on the positive aspects of owning a home, as opposed to the doom and gloom.

Heres to a GREAT 2007!

- Robert Mickalson