Glen's Numbers: The Latest East Bay Housing Market Data.

Here are Glen’s East Bay numbers taken from the MLS as of March 31, 2009.

Notice the totals for the percentage of REOs in the Actives, Pendings, Short Pays, and Sales columns. There’s a dramatic change occurring. Banks have been “trickling” in the REO assignments to their agents to list. Foreclosures have been at a minimum since November due to the various moratoriums and focus on preventing and slowing down the process. REO activity has been the focus for many agents, buyers and investors. Prices in many areas are flattening out. We’re getting a multiple offers on many of our properties.

What the numbers are reflecting is that fewer new REO properties are available and coming onto the market (now at 24%), yet there’s still been a demand for them in many areas, (pending at 51%). The sales since the beginning of the year reflect that, (68% of all sales are REO in the 38 cities that I track).

Supply and demand is such a major influence in real estate markets.

The Month’s Supply numbers support this as well. 6 months is considered normal by most, a state of equilibrium. Look at how many cities are now well below that number. Most of these areas were well over with many into the double digits during the middle of last year. For the 38 cities that I track, we had a 9 month supply in July of 2008 compared to a 4 month supply now. Inventories have steadily been dropping since late last year.

The most dramatic example are in areas along highway 4, such as Antioch. This area led the way with foreclosures. Antioch had well over a year’s supply of homes available during the summer and fall of 2008. 90% of the sales have been REOs since the beginning of the year and now they are at a very low 2.4 month supply. I think this reflects the public’s awareness that now is the time to buy.

Furthermore, most price comparisons are based on comparing median prices of the most current month to the same month a year ago. With more emphasis on REO sales and with a higher percentage of low end properties selling now, it has a more dramatic appearance on price reductions. In some areas, were actually seeing that, on average, selling prices are at, or slightly above list prices. For example, large areas of North & East Richmond are selling at almost 5% over asking. Compare that to Richmond’s worst hit area, the “Iron Triangle” where properties are selling, on average, at about 7.5% under asking.

Short Pays or Short sales are where the seller owes more than the house is worth and the lender agrees to discount the balance of the loan due to an economic or financial hardship. The process hasn’t been streamlined by the banks and normally is a slow and difficult process. That’s why there are many attempting to conduct a short sale (24% of current listings) but few that successfully pull it off (10% of sales since the beginning of the year.

We’re hearing there’s more foreclosures and assignments on the way, a second wave. However, much will be dependent on what political action is taken, our financial markets and how the banks change their process in the coming months.

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