August 2012 Hot Topic! Shrinking inventory misleads future sellers… for now
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Do you believe the current volume of speculators will still be buying homes during the last half of 2012?
- Yes. (65%, 161 Votes)
- No. (35%, 88 Votes)
Total Voters: 249
California’s housing supply is shrinking! Is this a Wall Street Minsky Moment for California’s real estate market?
Data: Housing inventory has decreased by 49% in Los Angeles and 53% in San Diego this summer, compared to the same period one year ago. This lack of listings is causing bidding wars.
Result: Sellers have received high multiples of bids, 50 or more on a single property, lifting home sales volume and prices in the second quarter (Q2) of 2012. All this action puts sellers in the most competitive position they’ve held since the dead cat bounce of late 2009 and early 2010 during the tax credit episode, which stimulated a homebuying surge and resulted in momentum driven speculation.
Thus, a huge level of inventory displacement has taken place, but is it that moment of instant, long-term change?
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About The Author
Carrie B. Reyes
is lead writer in charge of the Real Estate Practice and Due Diligence and Disclosures books.
![iStock_000004186637XSmall1[1]](http://firsttuesdayjournal.com/wp-content/uploads/iStock_000004186637XSmall111-106x75.jpg)
I agree that for a true housing recovery, we need job recovery first. However, unlike you, I believe we need ONLY private jobs, NO public jobs, since every public job has to be funded by private taxpayer money, every government job is a drain on the economy.
For private jobs to improve, we need a new, more business-friendly administration, that means we will have to wait for the election to make long-term predictions about the job market and the housing market.
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Privatize ALL jobs?? So in other words, we should get rid of the United States Postal Service and send all our mail through FedEx? Hmm…
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ANOTHER excellent article by First Tuesday. I totally agree. Please keep them coming!
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A thought-provoking article. I agree investor demand is driving this market at the moment, but I am more optimistic that consumer demand will ramp up next year – assuming we get a new administration in the White House. The biggest risk to a healthy economic rebound is the anti-business, anti-growth policies of the Obama administration. Hopefully this November will mark the end of this failed experiment in big-government cronyism, and America can be open for business once again.
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