Have Palos Verdes Homes prices finally hit a bottom in 2012? So will 2013 be the year of recovery or relapse for Palos Verdes real estate?
The Wall Street Journal has recently published an article entitled “2013: The Year Home Inventory Hits a Bottom.” The article talks about how for the past couple of years, the inventory level of homes has dropped. As a real estate broker, I can tell you that’s a mixed blessing as while the supply/demand balance has certainly helped stabilize prices for Palos Verdes homes, inventory (as you will see in the Video below) is at the lowest level in decades and thus makes it hard for us to find homes for our many buyers!
However, don’t make the mistake of thinking that we’re in the same sort of a market as we were from 2003 to 2006. One of the reasons why inventory levels are so low is because many homeowners are unwilling or unable to sell at the prices that exist today. Yes, prices have firmed, but they aren’t anywhere close to the levels that were at the peak of the market in the 4th quarter of ‘06. Many of owners who own Palos Verdes homes are still in barely positive equity, many are in very negative equity and where they would be sellers in a “normal” market, they can not bring their homes to market at today’s price levels.
Although, as prices pick up, that will change. We will see inventories increase and hence the market cycle continues. For now, buyers have a double positive—incredibly low interest rates and prices that from a historical perspective are also very, very favorable. You can click the “Housing Inventory Drops in November” chart to get to the interactive charts. However, for a more microeconomic view point, please play the Video below.
If you would like to see a full sized image of the chart for Palos Verdes homes above, please follow this link.
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