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Su Casa - Real Estate

May 2008

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What’s Going On With
This Market?
By Richard Stanley,
Ledger Columnist

   First, whatever information I share in this column is based primarily on my own firsthand experience and assessments. That said, here is my take on what’s happening in residential real estate around our part of town.

Sale Prices: Imagine a symmetrical bell curve, with sale prices rising vertically and time running horizontally. Put “2006” at the top of the bell. Last year, 2007, was about at the same sale price height as 2005. This year’s prices are about at the height of 2004. I expect we will soon, maybe later this year, or next, see prices at about 2003’s level. At some point, prices will level out, then rise again—they always do.

The Inventory: This spring is seeing an explosion of inventory. Smart sellers know to attract a buyer today requires pricing their property so that it is perceived by buyers as an outstanding value. Overpricing (at, say, the level of 2006), or making small price reductions over several months or more, is deadly. After a few weeks, the property remains forever stale. In a softening market, it is better to price “ahead of the curve” so that buyer urgency may be fomented.

Buyers: Open house attendance is very high lately. Pent-up demand is present and growing. Reckless speculators are absent. Buyers today intend to live in what they buy. Sellers who price well-maintained, attractively updated properties ahead of the price curve can still attract multiple offers in the first week of marketing—and get over-the-asking-price sales. Further, buyers in the market now have cash to spend. Perhaps because of the stock market’s instability, perhaps because of scarce mortgage money, perhaps because of a desire to reduce monthly overhead, buyers are making offers with enormous down payments—even all-cash offers.

Foreclosures: Lender-owned properties, despite what the media may lead you to believe, are not having much, if any, effect upon our local real estate market. Foreclosed properties are few locally. Those that are for sale tend not to be good values. Often they require significant remedial work and/or have irreparable defects such as a poor location or bad design.
   Effects of the Griffith Park Fire: In the year since the fire in the park, I have not noticed any resultant effect upon the Los Feliz real estate market. I currently represent a house that overlooks part of the scorched park, Glendale and the San Gabriel Mountains all the way to Mt. Baldy. Some people remark about “how close the fire came,” but everyone is inspired by the “amazing,” “spectacular” view. We will always remember with gratitude the courage and skill of the fire department last May. Already, we are witnessing nature’s fascinating recovery from the devastation. And, the Los Feliz hills continue to offer the unique and irresistible allure of urban vistas at the edge of the wild.