Monday, June 18, 2007

Falling SM, MV $/SF

The LA Times Sunday, Malibu, Encino at top of the real estate market, referenced this DataQuick Jan-April 2006/2007 chart. Here are some Westside zip codes. ("Zip Codes with 25 or more sales" must have omitted Santa Monica 90402, north of Montana.)

Zip   Place             '06 '07 '06 $/SF '07 $/SF      %
_____ _________________ ___ ___ _______ _______ ______

90272 Pacific Palisades 66 57 $822.91 $875.06 6.3%
90049 LA/Brentwood 60 53 $792.01 $807.69 2.0%
90064 LA/Rancho Park 51 63 $643.85 $632.18 -1.8%
90066 LA/Mar Vista 82 113 $637.06 $614.89 -3.5%
90405 Santa Monica 34 33 $825.76 $763.20 -7.6%
90291 Venice 68 49 $940.15 $812.43 -13.6%

Here's some of the article:

Through the first four months of the year, single-family homes in the 91316 ZIP Code in Encino experienced an 18.2% jump in price over the same period last year when measured by cost per square foot, according to real estate tracker DataQuick Information Systems. Although most buyers focus on median sales prices, analysts say the price per square foot offers the most reliable snapshot of how a market is performing over a wide area.

...so-called move-up areas are not doing terribly well. In general, it's the low end and the very high end of the market that are enjoying the healthiest price gains. In addition, core areas — older, more traditional neighborhoods near urban hubs — are showing resiliency. ...

In the $2-million-and-above market, Michele Blackmon, who runs Michele Blackmon Estates for Keller Williams Realty, notes that the richest Southern Californians have increased their income at a faster rate than middle- and working-class residents in recent years. The upper end of the market doesn't necessarily correlate with what's going on elsewhere, she said.

"These buyers have the money to pay cash, so they don't worry about interest rates," said Blackmon, who hopes to close sales this month on two homes on the Venice canals for a combined $6 million. "They find a place where they'd like to live, and they buy."

Blackmon lives and works in the 90291 ZIP Code in Venice, which was among the worst performers in the first four months of the year. It's a tremendously diverse area, where multimillion-dollar houses fronting the sand and the canals sit blocks away from a gang-troubled neighborhood filled with dingy apartment buildings and deteriorating homes. Even the less desirable streets are pricey when it comes to detached, single-family homes, and they tend to attract move-up buyers.

"The lower end is not moving as quickly," Blackmon said. "Condo sales are down and those little fixers that developers buy. That's bringing the prices down by square foot."

The title of another Sunday article says it all:

It's the new normal

Sellers try for the right price off the bat, while buyers take their time deciding.

And an article Saturday acknowledged the impact of housing on California's economy but limited its effects:

Cooling housing sector takes toll on employment

The unemployment rate edges up. The construction and financial services sectors remain weak.


... Mounting losses in construction and financial services — the two sectors most dependent on home building and sales — contributed to the second increase in the state's unemployment rate in two months.

The rate rose to 5.2% in May from 5.1% in April, the California Employment Development Division said.

By comparison, the rate in May 2006 was 4.9%.

The uptick further widened the gap between the state and national jobless rates, the latter of which held steady in May at 4.5%. ...

UCLA Anderson Forecast economist Ryan Ratcliff ... said the UCLA forecast group continued to view this slowdown differently than past cycles in one other significant way: They don't expect it to push the economy into recession.

That's because, unlike past housing downturns, this time there are no other sectors poised for a decline. ...

1 comment:

latesummer2008 said...

I have said along that VENICE is going to suffer the greatest price declines on The Westside. The lots are small and the premium for being "funky" is way overblown. For that kind of money you can find bigger lots and better houses in other parts of the city. Santa Monica for example.