Greater South Bay market including:
Carson, El Segundo, Gardena, Harbor City, Hawthorne, Hermosa Beach, Inglewood, Lawndale, Lennox, Lomita, Manhattan Beach, Palos Verdes Estates, Palos Verdes Peninsula, Rancho Palos Verdes, Redondo Beach, Rolling Hills, Rolling Hills Estates, San Pedro, Torrance, & Wilmington
Comparing quarterly sales statistics over the past two years gives us a good indication of an improving market. Looking at the type of sale-distressed, standard, or probate-is another indicator of a market trending up.Only single-family residences (SFRs) were selected for the data this month. Distressed sales on our Multiple Listing Service (MLS) include homes that are in foreclosure
, in default, real estate owned by lenders (REO), Housing & Urban Development owned (HUD), auction sales, and short sales. Short sales are homes sold by homeowners that require their lender or lenders to reduce their payoff in order to complete
the transaction. Probate sales occur when a homeowner dies without anyone else on title or without a trust agreement recorded and the property is probated to protect the heirs.
Chart 1 graphs data from the 20-city Greater South Bay (GSB). The pink bars in the graphs indicate the total sales for each quarter. This quarter-over-quarter comparison shows a 10% or greater improvement in the second, third, and fourth quarters of 2012 compared to any quarter in 2011. Standard sales increased and distressed sales are trending down. Seasonal fluctuations account for fewer sales during the fourth and first quarters of each year. Sales activity drops during the winter holidays and picks up during the spring.
Chart 3 – Beach Cities SFRs
Activity in the city of Torrance (Chart 2) also shows increased sales overall. Activity in the first quarter of 2012 was the same as in the same time period in 2011, but the second, third and fourth quarter show a 10 to 25% increase in 2012. Standard sales are increasing and distressed are decreasing.
Gardena (Chart 5) shows an increase of approximately 20% in the second and third quarters of 2012 over 2011. Note that first and fourth quarter sales were about the same as 2011. While sales trended down in the second half of 2012, so did distressed sales. Distressed sales reached their lowest point in late 2012.Carson (Chart 6) data shows that the city still has a considerable amount of homes requiring a distressed sale. Overall sales have increased in 2012 but distressed sales have held steady at about 80 per quarter. Note how standard sales have trended up with total sales during 2012.
As inventory declines in 2013 the number of sales will decrease. This will put pressure on prices to increase which will also decrease the number of distressed sales. TheCalifornia Association of Realtors
(CAR) projects a 1.3% increase in sales and a 5.7% increase in median prices during 2013. Based on 2012 market trends, I suspect that the GSB will see a greater increase in median prices during 2013 than CAR predictions.
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