Los Angeles Real Estate Blog

The South Bay Real Estate Market Authority

From the desk of Greg M. Ingerson, Attorney At Law

As we head into Summer, South Bay home sellers should begin to see a gradual decrease in the number of showings and inquiries for their home over the next few weeks.

Last month, the MLS summary showed that there were 2400 homes for sale in South Bay and 293 sold. Translation, under current market conditions, in any given month, you have about a 1 in 8 chance of selling your home.

In other words, when pricing your home, the practice of adding a "Pad" or "Cushion" to make room for negotiating is not advisable in this market.

As an informed Home Seller, you should understand that with an increase in inventory “supply” there is a corresponding decrease in demand.

Home Sellers should pay close attention to “Current Buyers.” Similar homes that have recently “Sold” tell us what people are willing to pay for this kind of home, in this area, at this time.

Information about similar homes “Currently for Sale” tells us what we are competing against. Buyers considering your home are also inspecting these homes.

Moreover, “Expired” listings tell us what people are not willing to pay for this kind of home, in this area, at this time.

Home Sellers in this market should realize that buyers in today's market will not overpay for a home and even if they would, the bank will not loan more than the home is worth when it doesn’t appraise.

So what can we expect? Demand should decrease a little over the coming weeks at least until the “sub-prime” mortgage meltdown crisis is figured out.

The Numbers Don’t Lie, Here Is What's Happening:
On May 1, 2008, there were 2400 active listings for sale in the South Bay Market (Areas 107-193): 1545 Houses; 509 Townhouses; and 346 Condominiums.

In the past year, there were 4001 homes sold in South Bay (between 5.01.07 and 4.30.08): 2568 Houses; 973 Townhouses; and 460 Condominiums.

What this means is that on a yearly average, the inventory is currently turning over at a rate of approximately 1.7 times per year.

Broken down even further by specific property type, we find that given the current absorption rates, we can expect Houses to be on the market an average of 217 days, Townhouses will be on the market an average of 188 days, and Condominiums should be on the market an average of 271 days.

Market Recap for the Month of April, 2008
When one compares the April results with the yearly result, we find that there is an approximately 8.2 month inventory of homes for sale in South Bay.

Broken down by specific property type, we find that there is a 7.6 month inventory of Houses, a 7.8 month inventory of Townhouses, and a 13.3 month inventory of Condominiums on the market in South Bay. (Based on current absorption rates).

How should a Seller approach the market? The key in today's market is proper pricing. If you are thinking of selling, now may be the best time to put your Home on the market for the foreseeable future before any additional interest rate increases are implemented.

How should a Buyer approach the market? For buyers, this is a good time to be in the market while sellers are willing to negotiate price and while interest rates are still low. For those hoping that the market will cool, any advantage obtained by waiting for prices to decrease may be offset by higher interest rates.

For more information regarding the South Bay and/or greater Los Angeles Real Estate Markets, please visit our website at http://www.LAHomeSearch.com for FREE information or give our office a call at 310.908.2172 for Free Recorded Information 24 Hours a Day.

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South Bay Home Sales by the Numbers
293 sold in April 2008
542 sold in April 2007

2400 Current Active Listings
1545 Houses
509 Townhouses
346 Condos

293 Sold in April 2008
202 Houses
65 Townhouses
26 Condos

556 Contingent & Pending in April 2008
353 Houses
129 Townhouses
64 Condos

291 Expired in April 2008
192 Houses
64 Townhouses
35 Condos

542 Sold in April 2007
339 Houses
138 Townhouses
65 Condos

575 Sold in April 2006
361 Houses
144 Townhouses
70 Condos

658 Sold in April 2005
378 Houses
170 Townhouses
110 Condos

631 Sold in April 2004
422 Houses
126 Townhouses
83 Condos

773 Sold in April 2003
515 Houses
173 Townhouses
85 Condos

826 Sold in April 2002
539 Houses
182 Townhouses
105 Condos

696 Sold in April 2001
433 Houses
158 Townhouses
105 Condos

734 Sold in April 2000
461 Houses
174 Townhouses
99 Condos

102 Expired in April 2007
71 Houses
11 Townhouses
20 Condos

155 Expired in April 2006
107 Houses
28 Townhouses
20 Condos

70 Expired in April 2005
44 Houses
13 Townhouses
13 Condos

37 Expired in April 2004
29 Houses
4 Townhouses
4 Condos

76 Expired in April 2003
56 Houses
14 Townhouses
6 Condos

78 Expired in April 2002
56 Houses
15 Townhouses
7 Condos

96 Expired in April 2001
75 Houses
13 Townhouses
8 Condos

97 Expired in April 2000
71 Houses
16 Townhouses
10 Condos

To search for bank owned properties on the market go to http://www.LAHomeSearch.com

To search for Southern California Real Estate including real estate in Beverly Hills, Brentwood, santa Monica, and Malibu go to http://www.LAHomeSearch.com

For Los Angeles Real Estate go to http://www.LAHomeSearch.com

To search for "For Sale By Owner" properties in the Los Angeles Real Estate Market visit http://www.FSBO.LAHomeSearch.com

Thinking of Selling? To get the most Money, Fastest Sale, and the Fewest Problems, visit http://www.LAHomeSearch.com

About the Author
Greg M. Ingerson, Attorney At Law & Real Estate Broker, is a real estate Broker with LA Home Search in Los Angeles, California. To learn more about the Los Angeles Real Estate Market, please visit http://www.LAHomeSearch.com