Saturday, July 4, 2009

Why all the "FOR RENT" signs ?????????

It's hard not to notice all of the "for rent" signs on the Westside. INMHO it reflects the real state of our economy. JOB LOSSES. It doesn't matter how favorable terms are to buy real estate if you have lost or are worried about losing your job. Perhaps, many homeowners are hoping to wait out the recession, only to test the market next year or after. Good luck. The main problem we face is the disappearance of high paying jobs in the FIRE (Finances, Insurance & Real Estate) industries. The jobs that are being created now are in the retail and service industries. Where are these new high paying jobs going to come from now that the stock and real estate market bubbles have popped? Until GOOD JOBS are CREATED, the only direction for real estate is down.

61 comments:

dashingdwl said...

Amen.
This Depression will not be televised.

Anonymous said...

Hmm, how much do people think it is just related to UCLA students moving out of their overpriced/family subsidized rentals when they are done with school? As happens every year around this time.

Anonymous said...

Your tone is flippant but it is really a big issue. Lots of people renting their places rather than sell at a loss, people sharing with a roommate "for just one more year till the economy picks up," people trading down due to job loss or fear of job loss. For sale signs are rampant where I live (brentwood) and each week a new crop seems to add to the pile. When I see the asking prices, some seem downright delusional in this time.

Mav said...

@Anonymous^: They're not UCLA students. Driven on Olympic through BH to Century City lately? Tons and tons of new for rent signs, way more than any previous years at this time. UCLA students don't live there. Palms, yes. But so many of these new For Rents are homes, too, not typical apartments students rent.

Anonymous said...

The economy is in horrible shape. Everyone I know has a good job and no one is happy or confident about the future. They are all homeowners--some on the Westside and some in other nice So Cal neighborhoods.

Even if you have your Westside (or other dream house), no one seems to be enjoying life because the ship is sinking and there's nothing that anyone can do about it.

Miserable all around.

Anonymous said...

It was delusional to think the bubble prices could be maintained to begin with. Did anyone ever stop to think what the toll would be on the next generation of home buyers if prices had kept rising? For the next generation, the price decline is not only good but necessary.

If you bought in at the peak, you should focus your anger on the government that abetted the bubble and on the media that cheered it on. Everyone who told you "real estate never declines in price" was either a liar or an idiot. Either way, they helped lead many to their financial ruin.

The faster prices are allowed to bottom, the better. The longer we drag this out, the more damage we inflict on our economy. We need to learn just how bad a hit we will take and then get on with our lives.

Anonymous said...

First you tell us that there will be a whole new set of mortgages going into default, sometime around late summer 2009. You had been beating this drum for several months now. The so called "second wave" of loan defaults (prime loans) were supposed to hit in Sept, 2009, and you have done a good job showing how the Westside borrowers relied heavily on these financial products. These mortgages used creative and potentially deadly financing like interest only, partial interest, low rates that adjusted up, etc. (Alt/Options,etc.).

Now you are saying the unemployment will be responsible for the Westside housing value correction? ???

Your posts are increasingly sarcastic and are sounding less like studied, rational and evidence driven conclusions, and more like hype coming from the opposition to the "RE machine." (which, btw, is equally flip in their tone about the market coming back).

I respect the work you have done promoting caution for people looking to buy a house on the Westside, but I respectfully suggest that you need to go back to your factual and rational presentation of data, and, if possible, corral your rhetoric and make a link between joblessness, the Westside and your theory about the second wave of foreclosures.

From what I have read about job losses and unemployment, it appears that the people who live in the Westside, that is Santa Monica and close communities, are much less affected than, say, the less skilled workers in outlying areas like San Fernando, etc.

Anonymous said...

People in Santa Monica are less impacted, but they are impacted. the impacts are two fold - some people in Santa Monica losing their jobs and others in santa monica seeing income reductions

During the bubble a lot of marginal people thought that they could afford North of Montana. Now that the great recession is here, these marginal types realize
they can't afford North of Montana and have thrown in the towel on that dream / fantasy.

The people buying houses North of Montana today, July 2009, actually can afford those houses. North of Montana is attracting today July 2009 the people that actually belong there, not the marginal types

We are getting back to reality

Anonymous said...

In response to anon 1:15, it's happening all over. Every building on my street in West Hollywood (every single one) has a vacancy. It's been interesting to watch build in the last six months (I walk to work). This article in the LA Times supports the visible shift in the rental market: http://www.latimes.com/classified/realestate/news/la-fi-rental5-2009jul05,0,652107.story

Anonymous said...

Yes rental market is moving strongly in favor of renters

If anyone is shopping for three bedroom town houses between 15th and 26th and between Montana and Wilshire, post here. That is the niche of the rental market I am trying to follow most closely -

Anonymous said...

realtor . com has a number of townhouses in that neighborhood for rent - but post here about ones not on realtor . com

Latesummer2009 said...

Anon 12:10

I have decided to post more open questions to stimulate conversation about what's really happening on the Westside. Facts and figures obviously are important, but with very few sales it is getting harder and harder to value property. The truth is, the market is weak and only getting weaker, with the latest trends in unemployment. If you think that Santa Monica and the Westside aren't impacted, your sadly mistaken. Give it a few months.

The Alt-A/Prime disaster has been postponed about 3 months due to foreclosure moratoriums. All that does is get more foreclosures in the pipeline to begin showing up in December. From there on out, it is rough saling ahead for the Westside.

If you detect a bit of sarcasm, it is because I have worked in the real estate industry before, during the last bust. I very rarely believe anyone, who is remotely tied to the industry. 99% of them are professional liars in one form or another. Sales is sales, it doesn't matter if your selling houses or widgets. Rent "Glengarry Glen Ross" and you'll get the idea.

I am not in any camp, just trying to stay informed by reading the most current information. If you don't like this blog, then simply find another one or start your own.

Anonymous said...

Hi Latesummer2009,

This is Anon 12:10, and I appreciate your reply. I'm not entirely satisfied with your linking opinions about unemployment to the Westside (even though, as I said above, I think it certainly is more of a factor in outlying areas); however, I'd like to clarify a few things:

1) I do like you blog, particularly the early posts. Your information was a real eye-opener for me, and has helped me "stay the course" and wait for the market to soften even more.

2) I have been increasingly frustrated by the acrimonious posting between people (apologies to those posters who articulate well thought-out ideas- who are certainly in the majority). Seeing your own postings move towards a more sarcastic and less evidence-based tone leads me to believe that you, a person who has relied on strong facts, is giving in to this type of behavior.

3) The fact that I am taking the time to write this is an indication that I value your opinion and research and, as a "fan" would hope that you, too, can see that a blog like this one that is based on facts not pure speculation is an assett in the fight against misinformaton from RE professionals.

(I realize there is a lot of guess work here too, but at least you have a tremendous amount of "indicators" to derive your guestimates from).

4. I am NOT suggesting that the Westside is going up in value, but I'm having difficulty following your facts on unemployment. Yes- California has high unemployment, but the state has a very diverse job market portfolio.

Getting back to the unemployment numbers and the Westside, can anyone help me see a clear link? I've googled this stuff, but I'm interested in industries specific to the Westside. I'd say that we have a LOT of white collar, and starchy collars at that. I am interested to see how doctors, lawyers, finance, publishing, and the myriad of business consultants (of which there are a boat load) are doing.

Anonymous said...

to find cause and effect data is impossible with respect to westide homes prices. this type of data would only exist if involved in a PhD dissertation. Secondary gov't data would only scratch the surface and provide circumstantial links. We need a solid primary data sample from homeowners and prospective homeowners on the westside. This would involve going door to door census style surveying as well as surveying the people who are considering buying with a down payment allready in place.

Anonymous said...

Doctors, lawyers and especially consultants are all taking hits on their incomes. I have a friend that works back east at a BIG pharma corporation and they are cutting back on everything--travel, consultants, etc. And his company is still making money.

Younger members of these professions are not going to make the money of their seniors. If ObamaCare gets passed, the salaries of MDs is going to go down the drain. And please don't tell me about the 4 cardiologists that have rich patients in Beverly Hills. There aren't enough rich private practice docs in L.A. to fill all of the 7 figure houses in the Westside. The days of free spending and unlimited expense accounts is pretty much over.

In other words, the Westside is not insulated from the world economy.

What a stupid thread this has turned into.

Anonymous said...

Anon 12:10: You suck.

Get off ur high horse and start walking around the Culver City neighborhoods and starting interviewing homeowners. A lot of them are in the shits right now.

Check out Dr. Housing bubble's latest article. He goes into some real good data: CC median income of about 80k. That number was extracted from IRS tax returns based on zip code.

Everyone is hurting--all the big law firms are cutting staff as well as accounting firms in the audit area. IT jobs are going and these creative jobs such as free lancing, photography are drying quick bc no one has the disposable income anymore.

It doesn't sound like you work, but ask your husband and he'll tell you that it is a tough place out there right now.

Anonymous said...

July 5, 11:51 PM

What a turd you are. Some schmuck asks Latesummer a great question and you grab your balls and act like an asshole. You fan boys are pathetic, and I bet you are all whining non-stop about people who make more money than you. Man up and get a real job!

For all of you econodopouts, we have a two caste system: with $$ and without. You are in the without category. I spent the weekend in a condo on Driftwood, that my partner owns. Driftwood is an "alphabet" street in Venice, and attracts a heft price tag. I attended a few block parties and I think your p.o.v. is up your little whiney asses. Mercedes are like the Hondas of Venice. Look at all the spoiled brats rolling through Speedway in their daddies Bently.. Go down to The homes west of Dell- do your little whiney bitch census down there. Ask about their layoffs. Don't expect anything more than a puzzled look.

I can guess that your psychological defense mechanisms are now in over drive. "Help us Latesummer" give us another good sarcastic poke at anyone doubting your BS. Most likely you are going to say, in your fey voices with a distinct lisps, "they are so over leveraged.." Bullshit. Guys at the top are cutting back but they are still at the top, and they have a lot of cash. Producers, bankers, lawyers, doctors, etc. The list goes on.

Will the wealthy be paying 2007 prices for homes, hell no. But they will bitch slap your little economic doom tale "the Westside sky if falling" b/c it isn't. Sure, it is slowing, but areas with such wealth float well above the jetsam and flotsam.

Anonymous said...

Hey 8:59AM, nice try. I guess your screenplay didn't sell so you're re-using your material here.

Kind of pathetic that the only place where you're the one "on top" is here (usually you're on all fours screeming "HARDER!").

LOL

speedingpullet said...

Ah, c'mon guys - why do the comments here always devolve into ad hominem attacks and trolling?

Anyway - I keep track of listings on Zip, and include some SFRs in Westside (though I'm mainly focused on south SFV, Topanga and some Malibu places) and have notced some interesting price trends in the last couple of months.

For properties listed below $800k, the prices are falling fastest: this may be due to them being short sales/forclosures/realtors setting the price deliberately low to encourage bidding wars. Prices reduced in the double digits..

From $800 - $1.2mm there are signs that prices are starting to reduce. Not by much, maybe 5% shaved off here and there evrey month or so - and it seems more frequent in south SFV properties that in Westside.

For properties above $1.2mm - especially in Malibu - nothing, nada, zilich. Prices are high, and sellers seem to be happy leaving the place on the MLS for a VERY long time (there's some palatial places in Malibu that have DOM of over 500 days). Maybe they can afford to do it, but its common to see maybe $25k dropped off a price after 6 months of sitting. Though the difference between $1.5mm and $1,475K is hardly going to bring buyers out of the woodwork...

So, I see the same formula in Westside and environs as is happening in th rest of L.A - the cheaper stuff drops the fastest and sells the quickest, and the most expensive drops the least and sells the slowest.

So, rather than kvetching at each other maybe someone could post observations about thier own favourite area? Anyone up for it?

Anonymous said...

The building I am renting in is a great example. When we moved in a little under a year ago a smaller floorplan 3bed 2bath was a repo on the ground floor and finally sold for 600k. Next a larger 3 bed 2 1/2 bath sold above us for 725k, then most recently the short sale in the penthouse unit sold for 650k. Since a penthouse is more desirable that is a pretty hefty drop.

Meanwhile rents on units like ours on our block dropped from 4000/mo to 3400/mo. We are "Bretnwood Adjacent" One block north puts us in Brentwood and we are west of the 405.

Lots of my young and mobile friends have been hopping from one rental to another as rents drop. Right now we are hanging tight because as rents drop the prices have to drop even further to justify buying. A friend with a multi million dollar home in Brentwood who is very solvent pulled it out of escrow because teh buyers jerked him around too long. They are in no financial trouble. The two people I know who bought houses at peak in brentwood and have to move or are under finacial stress are renting their places out and planning to wait for the market to come back while taking a monthly loss. Their renters are making out like bandits. Why anyone would consider owning a piece of property that is declining in value and renting it as a loss and long-term investment totally baffles me.

The one I know who is rock solid paid cash, only the people who took on mortgages are financially weak.

As for the troll above, I know producers and lawyers in this area who are not doing that well. Most do not make extreme amounts of money, just the elite at the top.

Anonymous said...

July 6, 2009 9:23 AM

Great post. Hahaha

Anonymous said...

It was the marginal ones who drove up the prices on the west side with their no-money-down liar loans, and it will be the marginal ones who walk away when their homes are worth less than they owe. Unfortunately, they'll take the property values of the entitled ones with them when they leave. But that shouldn't really matter to the entitled ones, because a loss of a few hundred thousand dollars on paper is nothing to a rich doctor or lawyer. Luckily for them.

Anonymous said...

I don't know what proportion of Westside residents the entertainment industry makes up, but there have been significant layoffs from the WME merger, and ABC and Paramount just laid off dozens of people (those probably live further east due to commutes) and Fox, Sony and Paramount are rumored to be combining their home entertainment units.

Any of these people who are lucky enough to find new jobs are making less money. Granted many of them get good severance packages but it is a tough time out there. The entertainment population may be smaller than the doctors, lawyers, consultants but they used to fuel the Westside/LA economy with expense accounts and a lifestyle that has been dramatically reduced over the last year.

Anonymous said...

Same endless story...

"Sure, it is slowing, but areas with such wealth float well above the jetsam and flotsam."

I've lived on the westside for 10 years. Yes, many wealthy people. Is there a greater proportion of wealthy people in SM today vs. 2003? No. Is average income or net worth significantly greater today (post market and housing crash) than in 2003? No. Bubbles burst. 10 years later and Nasdaq is still more than 60% off peak. Housing won't be AS bad, IMO; but anyway who doesn't think westside peak to trough will be significant is a fool.

Anonymous said...

Can we bring this back to a discussion of properties? The thing that frustrates me is that I read this blog and believe that the data supports a Westside market undergoing a massive price correction. But the new listings are NOT showing the pricing that several people (hear and other online forums) believe should exist.

We really like this street in Mar Vista, and this property just came onto the MSL:
http://lalife.com/address/4221_Kenyon_Ave_Los_Angeles_CA_90066

It is your average 90066 house: 3 +1, with fresh paint but no (discernible) upgrades. It is listed for $660,000!!!!! Now this is better than the 700,000 that it would have commanded just two years ago, but, if I accept the premise that the Westside is about to explode with defaults, and that joblessness is going to force more home sales (even for people who otherwise have a good mortgage rate), listing a home for 660K doesn't match the theorizing.

I'll watch the listing and report back. Unfortunately, other places that look similar (I haven't been to the house yet, so I cannot really report the shape, etc.)in Mar Vista are selling at the 600K range(ish).

I don't believe them, but RE agents are saying that multiple offers ARE occurring. I'm having a hard time reconciling the current sales trends and the theory on this website. But I'm not in any rush, and I hope the Westside of LA, like Mar Vista, eventually comes back around to an affordable price, like 400K or so for the house linked above (roughly a 2002 price).

Signed,
Frustrated Santa Monica Poor Boy

Latesummer2009 said...

First of all multiple offers are no big deal. It's what kind of offers that matters. I'd rather have 1 good clean offer than 10 lousy contingent etc.... ones. Don't believe the RE agent hype. They are dying on the vine.

Many of the listings you are seeing now are probably owners underwater, so they have little choice but to list high and hope for a sucker to bail them out.

There is absolutely no hurry to buy right now. It should get real interesting once we get through the summer selling season. We are almost half way there. With loan resets scheduled to start in December,just sit back, relax, and enjoy the show.

Anonymous said...

The amount of people who listed in the westside (talking Pacific Palisades), then pulled off the market, is pretty telling. Most of these homes are not going to go into foreclosure. They simply won't be sold until . . . a better time, if ever. Walk the neighborhoods, go the the local events like the farmers market, and see what the vibe is. Unemployment may be a factor, but it certainly seems to have a very minimal effect upon the current Palisades market. Despite what the doom sayers would like to believe, the entertainment businesses upper execs have been relatively shielded and even if laid off generally "fail up" as the term goes, so I would not kindle the fire in the hopes their loss is your gain. The managers and lower VPs never made it to the Palisades anyway unless they had a bit of the ole trust fund, and if they did, they will be staying as well. As one who has been in the game for well over a year focusing on this market to both sell and buy, my experiences seem to indicate that job loss is probably the least biggest factor in the downturn. The lack of capable buyers and move up buyers seems to be hurting sales the most. As now, very few can sell what they believed was their wonderfully appreciated less desirably located westside starter and move up, like one could a few years back. Their values plunged and their ability to get loans, even if reasonably qualified, have tightened up considerably. Just an observation from the trenches north of Chautauqua.

Jon H said...

If Chautauqua and the SM Canyon had a trench I'd buy into it, but it doesn't so I'm looking in Mar Vista ;-)

Anonymous said...

I wonder what is the age demographic or California living tenure of most posters.

To price decline deniers: please study Calif. late 80s all the way through 1997 (steady price declines). Case Shiller. First Republic. The data's out there. It's never "different this time." In fact, it's worse this time b/c of the unique credit bubble (i.e. liar loans, pick-a-pay idiocy)

Also ignore listings as an indication of price. It's only what people want, and lags reality in other cycles. Monitor (i) growing inventory, (ii) sales actually occurring, and (iii) 2001 - 2004 comps.

On a separate note, I recently asked a real estate agent for 2001 - 2004 comps in Venice and MDR. They sent me 2004 - 2007 and said these were more recent and appropriate. What a joke.

Jason

Anonymous said...

Is anyone else frustrated and fatigued by the continually comparison/cause-effect of foreclosures and homelessness.

Monday's USA Today survey was the latest to correlate one to the other.

When someone gets kicked out, they don't become "homeless," they become renters. Doesn't everyone know this!

I certainly haven't seen families from 90402 wandering the streets of SM and sleeping in Lincoln Park with the bums. Ridiculous.

Anonymous said...

^^RE: 6:29am

Totally.

While it is sad for a "homeowner" to lose their home because they can't afford it, it will end up being better for them when they move into a rental they can actually afford.

The media likes to make it seem as though if we don't throw money at these people and reduce their payments with our tax dollars that they'll be out on the street.

Anonymous said...

My wife likes the Pacific Palisades area, and we're flush in cash waiting on the sidelines as the general RE market drops. Is anyone here experienced with Pacific Palisades RE? The "better" areas for about $1.0 to $1.3M?

Anonymous said...

We thought about Pacific Palisades (PP) but gave up after seeing homes in excess of 1.7M that were disappointingly short of uniqueness and amenities. We moved our search to the North side of Santa Monica, which, even though it is not as exclusive as PP, had some really nice and quality built homes for similar $$.

You can look in the PP neighborhood off of Chautauqua, (Bashford, Hartzel, etc) but for a million you will only find small homes, and they are not well suited for major renovations (i.e. small lots, etc.).

Santa Monica, OTOH, you can find houses N. of Wilshire for a cool million, or around that sum. North of Montana you will need to pony up a little more scratch. These neighborhoods have some modern architecture and the lots are a decent size.

I'm in a similar situation. I have approximately 400K to play with, and I am going to wait a little longer until I jump back into a house. We are living in our condo in Century City, which is small but very high end, and we can hold out another 6 months or so before I need to get my money back into a house asap.

Ideally, North of Montana will have dropped a little more, and we can score a place for about 900K-1M, drop another 100K into if, and have a very nice place.

If PP dropped into that price range, however, I'd buy there instead of SM. Kids have been away at college for a couple years and I do not care about schools,etc. The Palisades has a much more quaint and tight night community. Most of my business partners live there (I am a radiologist) and it would closer to our ideal neighborhood.

Anonymous said...

Radiologist,

Thanks for the info. We also currently live in a condo and have nearly $850,000 cash. I was wondering why within about 6 months you need to get your "money back into a house ASAP." With the RE market poised to drop perhaps long after that, what would be the sudden reason to get a house (if I am not too personal)?

Anonymous said...

We have two major streams of short-term income: my job and our local investments (I'm not including our long term investment portfolio, which has been beaten into submission!). Our local investments include two restaurants and some minor equity in a service oriented business.

The short story is that the restaurants are doing much better than expected, but our partner is in tremendous legal trouble. He is now jeopardizing my financial well being because of my stake in the two eateries. We need to have less cash on the books next year for legal reasons.

On a side note, you have no idea how many broke chumps come calling and try to sue successful businesses. I am in awe over the earnings of our restaurant investments over the last year. Night after night, the places are packed with people, even when the paper reads "recession" daily! I can't quite figure why nightlife on the Westside is doing so well?

Anonymous said...

Interesting. Must be the great food, service and atmosphere!

Anonymous said...

what are the names of your restaurants? would love to check them out. Food and service must be really go there.

Anonymous said...

anyone actively looking for a 3/2 (approx. 1500sq ft) starter home in CC/Mar Vista? Just wondering what kind of prices you're seeing at this time.

Anonymous said...

No matter how much squawking some may do, the Westside market is getting hammered and it is only the beginning. The film industry won't save most as everyone everywhere is cutting back. Yes, even in the biz. Those people who bought houses in dicey areas will get hit the hardest~~~anyone buying in that dirty cesspool known as Venice will be forced to take a bloodbath if they are forced to sell. True, if people have reserves in the millions of dollars, then they may be able to hold out, but lacking that, they will lose money. I doubt too many who bought in Venice have the kind of money necessary to take such losses in strife, if they had serious money they would have bought in Malibu and not dealt with all the riff~raff that is drawn to the Venice boardwalk.

But we all know that Angeleno's are infamous for driving and living lifestyles far beyond their means. This is a great time to be sitting on the sidelines waiting for the idiots who over~payed to get the boot from their former homes. Bad time to be an owner with any financial distress, however.

Anonymous said...

Interesting analysis. Especially Venice. I too feel that area will get pounded, once the housing depression finally hits the Westside. The bigger they are the harder they fall. Besides, if you look at the fundamentals you have tiny lots, no parking, crime and Los Angeles services. Throw in hard times for the entertainment industry and it's a recipe for disaster.

Anonymous said...

Any people in the Industry that can provide some first hand insight into the above?

Anonymous said...

for anyone thinking lawyers are being spared in this downturn checkout http://abovethelaw.com/layoffs/

Anonymous said...

Based on the article, it appears that atty lay offs are in NYC and Chicago.

There are some many god damn trust fund babies and wealthy ppl here. The westside will dodge this one regardless of the what the numbers say. They will manage to find the money somewhere. The non trust ppls will find it in drugs, porn industry and sugar daddies and mommies. It is true and you guys know it.

Anonymous said...

9:43PM--That's the worst troll attempt I've seen in a long time.

It's going downhill so fast that these RE blogs are quickly becoming obsolete.

For example, do we really need blogs to ponder the fate of high end VCR machines?

Anonymous said...

At least in the Palisades, I just don't see it. Been waiting for the sky to fall for over a year and frankly, other than sellers having to adjust originally unrealistic asking prices (which the agents still champion! WTF?!), for the most part - and look at the figures provided on this blog - nobody is exactly getting "hammered". 10-15% below an unrealistic ask is hardly getting beat up. As one who is also in the media community, there were lay offs every year over the past five. A few people had to move/relocate and sell, most simply found other gigs, and for most who bought in PP in the first place, they are generally in a network to find those other slots for employment. The doom and gloom may still be abundant in the national RE market, but, the Palisades seems to be hanging in there just fine. Now, for starter homes, you'll still pay a tremendous sum for . . . a tiny 6,000 sq ft. lot and a little box for a house surrounded by $2.5-3mm mini mansions on same sized lot, but . . . some people like that.

Also, one must look at each area in the Palisades to really get an idea for the actual valuation slams. The Highlands with all the heat, drive and homeowners fees is getting hit pretty dismally, but . . . all in all, give or take the few "front door steps from Sunsets" and the foreclosed lots, the flats, Marquez, alphabets, and other areas of the Palisades remain in surprisingly good shape. No consistent sales pace but none of the predicted exodus many on here believe (pray for?) will come yet either, and I personally do not expect any major, or rather substantial, downward shifts going forward. We'll see though, won't we.

Anonymous said...

Actually, I meant look at the figures provided on the "Westside Bubble's blog", not this blog. This one's affable twin. He provides good data too. Thx!

Anonymous said...

Re: PP. It will catch up. Just watch the data.

For reference, there were basically twice as many homes listed in PP as of July 2009 compared to times throughout 2007. Average days on market was also an all time record at 164 days.

http://westside-bubble.blogspot.com/2009/07/monthly-inventory-update.html

On a related note, check the comp store sales of high-end retailers or the commercial real estate vacancies on Montana Ave in SM. Also, doesn't anyone remember the declines of the early 1990s? There were rich people back then too. I feel like the oldest person on this sight !?

Anonymous said...

I agree with the pessimists.

I live just south of montana and I am seeing more and more people forced to leave the neighborhood - marginal types - single parent families, immigrant families and etc. There were a lot of people just south of montana that could barely afford it in the good times and now they are gettting out -forced to live in the valley.

North of Montana the same thing isn't happening. North of Monana never had the poor struggling marginal crowd

North of Montana is just a cleaner nicer more special neighborhood.

but south of monatna look out - going down hard

Anonymous said...

I live South of Montana and it's true about people leaving. Any of the numbered streets have a buttload of for rent signs. Obviously a different demographic than North of Montana, but it shows the upper middle class is struggling. The real estate depression is climbing further and further up the ladder. It's only a matter of time before the high-end gets hit, due to declining home prices and businesses going under.

Anonymous said...

For the optimists, please note the following link (extracted from Case Shiller and it's from a lender!)

History repeats itself (tulips, pets.com, LA RE 1990, LA RE 2007, etc.)

Wake up. It's just begun. Don't catch that knife...

http://www.firstrepublic.com/lend/residential/prestigeindex/losangeles.html

Latesummer2009 said...

Perhaps the Meltdown on the Westside has just begun. This just in from Santa Monica Distress Monitor:

333 E. Rustic Canyon Rd. SM 90402
2+1, 1029 sqft, Lot 6403 sqft.

Sold for $1,500,000 on 7/26/06
Just Sold for $875,000 on 7/6/09
Thats a 42% drop that was sold as an REO. Perhaps the banks realize the market isn't coming back anytime soon and they will begin unloading shadow inventory.

Let the games begin...

Anonymous said...

It's about time that thing moved. It was a joke. I looked at the house. It was so small; no garage. It was basically a condo (next to the SM canyon sewer.)

alex said...

The high end in California is about to fall. For a good analysis of why, go to the Field Check Group and read the most recent post. It is very detailed and convincing. The high end is at a place where the low end was 18 months ago...on the edge of the precipice.

Anonymous said...

It is slightly out of this blog's 'zone', but high-end Little Holmby is going down quite fast. I have been interested in this neighborhood since 2006. 2007 there was very little inventory for either sale or rent and houses sold quickly with multiple offers. Now there are alot of houses in both categories - many sitting without reductions. I am betting that neighborhood will be down 40% from the high, based on they way things are looking. I think alot of the houses that are sitting (and some then subsequently listed for rent) are either unable to lower the sale price as they would owe the bank or are hoping that prices will rebound in a year or so... I am not aware of any foreclosures in that neighborhood yet, but I assume the houses sitting on the market for several months without any price reductions are eventually going to have problems. This is similar to what I see happening further west, as outlined on this blog.

speedingpullet said...

IIRC the place on Rustic has been on and off the MLS since early 2007.
My old laptop imploded and took all my data with it, so can't check anything before Jan this year, but the address sounds very familiar....

I liked the sound of it (though never went to see it - so thanks Anon 6:52 for the realistic, if slightly depressing first-hand account) because I'm actually looking for a place that's less than 2000 sq ft.
Last time I remember, it was hanging at around $1,250K....

$875K, eh?

We're starting to get there.....

Anonymous said...

We'll be at the bottom when there are no more posters on this blog who argue that "the westside is different," or "people on the westside have money and they won't be affected."

The day I hear "real estate is one of the worst investments you can make" and "the westside is one of the worst places you can buy," I'm in.

Anonymous said...

I just rode down Lincoln (or was it 10th) between Montana and Alta. Four homes for sale on one block. A couple look empty already.

The North of Montana is definitely not immune.

I find it amusing that there are people on this board trying to "talk up" the market. You can tell they're trying to convince themselves more than anything else. Denial is a tough place to be!

Anonymous said...

@Anon 4:46pm

"my experiences seem to indicate that job loss is probably the least biggest factor in the downturn. The lack of capable buyers and move up buyers seems to be hurting sales the most."

Uh, why do you think there's a lack of capable buyers and move up buyers? Job loss!

Anonymous said...

mid-city (pico/la brea) - for rent signs everywhere.

Sage-er said...

Prices of real estate will hit 'normal' levels six months before half of all these real estate blogs disappear...

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