Palos Verdes and South BayThird Quarter 2009 Real Estate Market Report

The real estate market for the Palos Verdes Peninsula and Beach Cities picked up substantially in the third quarter 2009. Both buyers and sellers stepped up to buy and sell. Properties that were sitting for many months sold at all levels of the market. High end properties are selling as jumbo loans have become more available. Buyers who can get financing are actively looking and aggressively offering where they see a deal. Sellers who are motivated to move are pricing their homes to sell.  

News reports are mixing in some good economic news in addition to the doomsday reports favored by the media. Lower priced homes are moving briskly with buyers taking advantage of significant discounts and record low interest rates. New tax credits are also giving great incentives to new buyers. Today, the Senate agreed to extend the $8,000 first time homebuyers tax credit that was scheduled to expire at the end of November to the end of next April, with the Housed expected to agree to extend the credit.

PRICE CHANGES  –  Properties, on average, in the South Bay are selling for approx. 96% of list price. The average price per sq. ft. for homes sold in the third quarter 2009 compared to the third quarter 2008, has fallen much less in the South Bay Beach Cities, however, than in most markets in Southern California. Recent news reports have indicated that prices may be stabilizing in Southern California. The median price of homes in Los Angeles County has also been increasing lately due to an increase in the number of more expensive homes being sold because of the improving market for jumbo loans.

Quarterly changes in sales volumes in the beach cities compared to last year varied widely, with some strong increases in sales volumes on the Palos Verdes Peninsula and San Pedro, but flat sales in Torrance and Manhattan and Hermosa Beach or decreases in sales in Redondo Beach.

Location 2009 3rd Qtr. Sales % Change 3rd Qtr. 2008    Days on Market Months Inventory

 

Sales Price Per Sq. Ft. # of Houses Sales Price Per Sq. Ft. Sales Volume

 

 

Palos Verdes Estates                    

 

$552            

 

  42

 

(22%)                  

 

 62%     

 

  84

  

     6

RPV, RHE, & PVP   431   99 (15%)  11%   71      4
Rolling Hills   644    6 (11%)  100 % 120     10
Manhattan Beach/Hermosa   606  113 (11%)                  ( 3%)          72      5
Redondo Beach

 

  450   70 ( 3% )                  ( 17% )       57      4
Torrance   366  227 (  3% )                     0 %        45      2
San Pedro   323   90 (  4% )                  22%      99      3

 

Inventory –  The total inventory of single family homes for sale in the cities listed above has decreased significantly during the last quarter, except for the more expensive area of Rolling Hills.

Inventory History –For most of the last two decades, L.A. County has averaged an 8 month inventory.  The number of months of inventory of homes in Redondo Beach, Torrance and San Pedro has shrunk significantly in the last 3 quarters. Homes in the lower end of the price range in the higher priced market of the Palos Verdes Peninsula and Manhattan Beach have been also selling faster than the higher priced homes, yet as  previously,  luxury home sales on the PV Peninsula increased in the third quarter.

  

What is a Short Sale?

CDPE – Certified Distressed Property Expert

Short Sales are a sale of a property where the sale proceeds are not adequate to pay off the existing loans, requiring the lender to agree to accept less than full payment of their loan. At this time, the fastest growing segment of the distressed property market is the luxury market.  I am a Certified Distressed Property Expert, and those realtors that have this designation have a success rate of 85-90% closing short sales, compared to a national average of 8-10% successful closings. Whether it is caused by relocation, loss of a job or increased mortgage payments, everyone at some point has been touched by the worldwide economic downturn. If you know someone who may need some help lease don’t hesitate to call or refer our services.

IT’S ALL ABOUT THE INTERNET.  We invite you to visit our award winning website at www.maureenmegowan.com.  Our website achieves extremely high placement on search engine results, such as “Palos Verdes Real Estate” and “South Bay Real Estate” on Google, for people using the internet to buy a home in Palos Verdes or the South Bay beach communities. This has made us a leader in serving relocation clients.

WEB BLOG (http://mmegowan.activerain.com ) My web blog is where I discuss the latest news on the real estate market and other interesting facts about the Palos Verdes Peninsula. I have also posted detailed market reports for each of the neighborhoods on the Palos Verdes Peninsula which lists the homes sold in each neighborhood during the 3rd Quarter of 2009. We appreciate your feedback and comments on my postings. Come join us.

TAX INCENTIVES:     The Federal government’s $8,000 tax credit for first time home buyers is scheduled to expire November 30th, but may be extended by Congress. There are also substantial tax credits for qualifying energy saving expenditures.  For more info, visit the following link on my website : Income Tax Issues

FINANCING   (See our web blog for rate updates):

BUYERS AND SELLERS TAKE HEART! There is financing available for well qualified buyers due to the Federal Reserve’s aggressive action in purchasing Fannie Mae and Freddie Mac securities. Funds for this program are expected to run out by the end of the 1st quarter of 2010 and interest rates may move up by upwards of a half point in the early part of next year. There are new guidelines for Fannie Mae and Freddie Mac loans, and 3.5% down payment loans are available with tight restrictions.  

BUYERS with good credit, an adequate down payment and 2 years or more employment history will qualify for Full Documentation loans. There are no Stated Loans ( no documentation) offered now. If the property will be your home, not a speculative investment, you should be buying for the long term. Today’s market gives buyers and sellers the opportunity to negotiate a reasonable deal for both parties.

Conforming Loans  (loans of less than $417,000) are at approx. 4.9 %.  Rates for loans between $417,000 and $729,750 (conforming jumbos ) are about one-eighth to one quarter of a percentage point higher. Conforming loans generally require a 10% to 20%down payment (less for FHA or VA loans)

Interest rates on Jumbo 30 year fixed rate mortgages (loans in excess of $729,750) have decreased substantially over the last several quarters to an average rate of approx. 5.75-6.25%. The interest rate spread between conforming loans and Jumbo 30 year fixed rate loans are approx. 75 % to 1.25 %  higher than 30 year fixed rate conforming loans. Jumbo loans also require a much higher down payment of 25 to 30%. This large spread between jumbo loans and conforming loans is amazing considering that prior to the mortgage loan melt down, spreads between conforming and jumbo loans were only approx. two-tenths of a percentage point. 7 year variable rate loans are available for jumbo loans at rates of approx. 5.4%.

All rates quoted above are as of 10/22/09 with usually FICO Scores of at least 740.

Thanks for reading this. We hope it helps your decision making. Call us for more in depth help for your property.

About mmegowan

I am a realtor with Remax Estate Properties in Palos Verdes Estates. Visit my website at http://www.maureenmegowan.com
This entry was posted in Uncategorized. Bookmark the permalink.

One Response to Palos Verdes and South BayThird Quarter 2009 Real Estate Market Report

  1. Hi,

    Just found this post my Tecnorati Social network Top News feed Section, really interesting post. Keep it up.

    Jennifer

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s