Stats Man and a little look at the Scripps Ranch real estate market

This morning, we offer you the first installment in a new series. Please welcome Stats Man (insert cheezy theme music here).

StatsMaStats Man has been known to come under attack for using small sample sizes and for just hurling the data without thoughtfully putting any of it into meaningful context. He is also wrong a lot, but more on that in a moment.

Have you been wondering which way San Diego housing prices are going? Just ask the “market watchers.” As reported by the San Diego Union Tribune this morning:

Market watchers (say) the median could keep falling and test the $280,000 level, but it also could rise above December’s post-slump peak of $330,000.

In other words, prices could go up — or they could go down. Glad we cleared that up. It seems that Stats Man has some competition where predicting the real estate market is concerned.

The article went on to say that foreclosures remain the big wild card factor, citing that as “foreclosures waned in 2009, the median rose.” Even Stats Man also might have mentioned a few outside influencing factors like home buyer tax credits, new-found affordability, and the threat of future interest rate hikes, all contributors to renewed buyer enthusiasm. Or not.

“But analysts said,” the article went on, “that even if foreclosures grow again, the median could still rise, if more high-priced homes are among the distressed properties.” And, that is a good point. Even Stats Man knows that so go the condos goes the market. The more expensive properties are historically market laggards.

Take Scripps Ranch. We use Scripps Ranch a lot in our little mini-market analyses because, well, we live here, but also because it is a sample size we can get our heads around. When we want to look at the number of active and sold distress sale properties (short sales and bank-owned), the only way to do it right is to manually plow through each listing. Even Stats Man has the occasional termite inspector to meet, so tackling this on a large-scale is unrealistic.

Here is how the active inventory looks in Scripps Ranch this morning for both attached and detached offerings:

210DetActive

210AttActive

I separated out the new homes in the detached category, because they are a different animal. The point here (I think) is that distressed sales haven’t hit the market in the higher priced categories with the same fervor as at the lower price points. If you believe that it is just a matter of time (and I do), then we could see this segment feeling the price pinch for awhile longer.

Now, one thing that struck me about the article was that there continues to be this notion that distress sales are smoking deals, and that these properties sell for much less than their traditional sale counterparts, becoming a drag on market values. I wrote about this awhile back and concluded that short sales and foreclosures weren’t necessarily the great deals they might appear to be (because the prices tend to float in the competitive bidding process). Maybe I was right then, or maybe I was wrong, but here is how things look today.

If you consider the sales of both attached and detached homes in Scripps Ranch in January (a whopping 12 and 11 respectively, which is why there are a lot of real estate agents selling their baseball cards and Barbies on eBay right now), this is how the sale prices per square foot stack up.

210DetSoldBar

210AttSoldBar

Actually the spread in median price per square foot is much larger for the attached homes, but Stats Man was too lazy to reset the ranges of his “Y” axes. You get the idea.

Now, we know that non-traditional sales come with strings. The homes are typically in inferior condition to the traditional sale home and come “as-is,” with no seller repairs or warranty. Buyers of these properties must also pay the price of long wait times with no assurance that their offer will be accepted. Nonetheless, the data suggests they are selling at prices far below non-distress properties.

Finally, and just for fun, here is what people were buying in January.

210DetSoldPie

210AttSoldPie

Blame it on investors, on bargain hunters, or simply on a cash-strapped or financing-challenged buyer pool, but forget the inventory; when it comes time to buy, the short sales and bank-owned homes continue to draw a crowd.

So there you have it. Now, Stats Man is off to fight crime — to find out where his clients’ loan docs are.

(Note: Stats Man relies on the Sandicor Multiple Listing Service. Data is deemed reliable but not guaranteed and all that stuff.)

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