John SkinnerMedian LA County home price down 10% since September: In September of 2010 the median LA home was going for $340,000 so we are now down over 10 percent in a matter of four months.
Case and Shiller disagree about the future: The widely followed Standard & Poor’s/Case-Shiller Index, which tracks the real estate market in 20 major U.S. cities, has differing opinions. According to a recent New York Times piece, Case calls the current state of the market a “rocky bottom with a down trend,” but doesn’t seem to think the sky will fall. Shiller, on the other hand, sees “‘a substantial risk’ of declines of ’15 percent, 20 percent, 25 percent'” from here.
Standards for loans will continue to rise and create negative issues: A wind-down of government-controlled Fannie Mae and Freddie Mac, as proposed by the Obama administration in February will make home buying more difficult and add pressure to the real estate market. It won’t have as dramatic of an effect on the Westside as it will in less well-to-do areas like the Inland Empire but you can definitely expect a jump in interest rates and even tighter lending standards which will cut down on what Westside buyers can afford. This coinciding with the conforming high limit loan balance dropping from $729,500 to $625,000 at the end of October is not a good recipe for homes worth around a million dollars.
Market anxiety subsides: While 53 percent of Americans said they are “very concerned” or “somewhat concerned” about having the money to make their monthly mortgage or rent payment, according to a recent Washington Post poll, 61 percent believe it is a good time to buy a house…
