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Pasadena Real Estate Market Feeling Wall Street Woes?
The last several days have been extremely volatile for the US economy. As congress debated the bailout/recovery bill, millions of Americans have watched helplessly as the value of their retirement accounts evaporate. What a difference a year makes. As the Dow Jones reached its high about twelve months ago, many people find their brokerage accounts have now been reduced by 40 to 50%. The hope that the recent legislation would add some stability to both the stock and real estate markets now seems to be wishful thinking. The daily fluctuations and precipitous declines on Wall Street may now be correlated to what happens here on Lake Avenue and Colorado Boulevard.
Impact On Pasadena Homes
Just when the Pasadena real estate market was beginning to show some signs of life for 2008, the first week of October could be telling a very different story. Conversations with a couple of escrow officers today indicate that October home sales have yet to appear on the radar screen. Both indicated that business had been steadier in September with new escrows being opened, but it has suddenly stopped. Neither officer had received any new contracts since Thursday of last week. Granted, this is only empirical data based upon a couple of informal conversations.
I also spoke to a lender with a major company in the home mortgage business. It was confirmed to me that money was available to lend, but no applications had been received in the last several days. Apparently, all of the recent news reports indicating a tightening credit policy have been felt in the mortgage industry. If you can meet the increasing standards to secure a home loan, money is available.
If ask to bottom line the current situation in our real estate market, I believe it can be assessed with one word. UNCERTAINTY. Uncertainty is usually not a friend of someone looking to make a major investment. Very few of us have the nerve to take a contrarian point of view and buck the herd mentality. It was also brought to my attention that we just might be experiencing a normal October slowdown. To that I would have to reply, “Slowdown from what?” You have to experience an increase to have a slowdown.
This real estate market like all financial markets is proving hard to predict.
Tags: pasadena ca real estate homes, pasadena homes, Pasadena real estate
October 8th, 2008 at 1:23 am
Hi Doug, I was researching market conditions today and saw some significant positive indicators for Pasadena. From data from Altos Research median home prices have started to tick upward. And perhaps even more interesting is the sharp drop in inventory that has occurred recently. This reduction of supply will inevitably affect prices soon. My conclusions are at http://PasadenaRealEstateInsider.blogspot.com. Feel free to comment your thoughts.
Thanks,
Sam
October 8th, 2008 at 5:24 pm
Sam,
Good Luck on your new site. My observations are that it is October, and inventory typically begins to fall off in October as home closings in November are low. The market has in the past picked up with December closings being higher. As far as inventory, is Altos is your source of information you are quoting, they only track current listings, they do not track “sold” data.
If home prices are moving up as you report it will probably be a couple of months before they are captured in “sold” listings. My guess is that home prices will lag last years numbers at least until December according to my tracking charts.