There appears to be a lot of confusion in the market right now. And by that, we mean we're very confused. All we do is post this nonsense and find funny pictures on Google, so don't ask us to make any sense of it. That's why we rely on our Housing Guru who contacts us when we most need him - like a magical pink giraffe. After yesterdays post on the housing market crash our Housing Guru chimed in with his take on Jason Calacanis' take on the market.
"I know Jason well. Typical shopper’s/non-owner’s wishful pessimism. I’ve had friends who never owned calling the decline since – uh – 2003. They want to WISH the market down. Now, listen, no one’s calling it a screaming market. But its just not falling yet in LA for the most part. There are huge reductions in LISTED price. But listings are not a market. Closed sales are. Jason’s making that same mistake. He’s looking at list prices. Not comps of sales. He’s also looking north of Montana in Santa Monica and Santa Monica Canyon. Which has been WAY over-priced for WAY long. And also about the most expensive stuff out there.
And, looking at closed sales, the latest data we have (August) shows prices up 4.4% over a year ago. Slower, yes. Crash? No. Even ahead of inflation.
The Housing Guru continues after the jump.
On top of that, I spend some time in the market. Today, it's about GOOD, smartly priced properties selling fast and mis-priced ones not selling. As far as I can see, all that’s changed is that you can’t rip people off anymore. Example: Sunday I looked at two properties in the same area of the Hollywood Hills for about $3 million dollars. One was 2,100 square feet, amazing 180 degree valley light views, great street but under-restored and not that good. Sitting. Unsold. The other was 2,800 sq/ft, fresh high-end build from the ground up, pool, nicely staged, but no view and on a busy street. Sold in 4 days. Already in escrow by the first open house. That’s $1,000 a sq/ft for a non-view house on a busy street. In a neighborhood that does not average $1,000 a foot. Apparently, there is still a market (and a strong one) for “done” houses. And no $1,000 sq/ft house selling in 4 days without a view says to me “crash.”
Thank you Housing Guru for offering us all your take on the market. Any questions???