The state of California has had its share of real estate struggles prior to the 2008 recession, but the recession has definitely not helped the problem. With California home to some of the most expensive real estate markets, also the most unaffordable for most people, the real estate in places such as Orange County have not fared well. Median prices and home sales have fallen greatly over the past year, but many experts are optimistic that the Orange County real estate has already hit bottom and is about ready to turn around for a recovery. However, major economic problems California faces, as well as job security are major obstacles that stand in the way of any major improvement in Orange County’s real estate market.
DQNews.com reported that home sales in Orange County and surrounding areas rose slightly during the summer of 2009. The general median price of homes and condos sold is still lower than it was in September of 2008, but several areas recorded year over year gains in the median price for resale homes. In September of 2009, 21, 539 new and resale houses and condos in the Orange County and surrounding regions were sold. September marked the 15th month in a row of year-over-year sales gains, even though it was the smallest of those gains. Orange County recorded a small annual gain of about 0.9 percent in its overall median price, the first gain since August 2007, when it rose 1.9 percent. Orange County also posted its first gain in the number of houses sold by 4.2 percent since August 2007, when it rose 3.6 percent. These signs provide hope that the Orange County real estate is on the rebound and poised for a full recovery.
Bloomberg reported and 11 percent drop in house and condo prices in Southern California between September of 2009 and September of 2008. The median price has declined from about $308,500 to about $275,000, even though the number of homes sold in the region have increased over the past few months. About 40 percent of home sales made in Southern California during September 2009 were houses or condos that had previously been foreclosed on. Experts report that although foreclosure rates are still high, they are still lower than the peak levels.
Many feel that Pleasanton and the Bay Area in which the city is located already had its fair share of real estate problems prior to the current recession that we are now in. It seems that the Bay Area real estate has hit bottom almost everywhere, and many expect it to continue to decline slightly over the next few months before and full recovery can begin to be made. Currently concerns relating to job security and the current economic challenges that the state of California faces pose problems to the future success of the Bay Area real estate.
According to DQNews.com, the real estate in the Bay Area has hit bottom with real estate rates fluctuating but not showing any consistent improvement. Between the months of July and August, the number of Bay Area homes for sale decreased by about 14.3 percent, but current sales are still about 4.0 percent higher than August 2008. The main reason for this is that many of the homes foreclosed on in the previous months have already been sold and now there are a fewer number of cheap, foreclosed homes on the market. In fact, the number of foreclosed homes for sale decreased by about 15.2 percent between July and August. This lack of foreclosed homes have frustrated many home buyers in search of more affordable “bargain” homes and has resulted in many of them to hold off on buying homes in the current Pleasanton real estate market. However, DQNews.com has also reported a slight decrease in the median price of new and resale homes and condos in the Bay Area by 8.9 percent between the months of July and August. However, this is due primarily to the greater number of people moving to low-end inland regions in search of homes.
The San Francisco Business Times also reports the current troubles that the real estate in the Bay Area faces. With job security a major concern in the region, many people feel that they can’t risk investing in a home at this time, no matter what kind of loan they can get. This has caused the Bay Area real estate market to continue to slow, and it many feel that it will still be a few months before any signs of consistent improvement can be seen in the Bay Area real estate market.
Although California’s real estate market was already struggling prior to the 2008 recession, which still plagues real estate markets throughout the state, many experts are hopeful that recovery is near due to signs of some improvement in some regions such as Southern California. Median prices of homes continue to decline very slightly, but in the past few months home sales have increased, with some communities posting year over year gains in home sales. However, issues such as job security and the financial stability of the state continue to pose as obstacles to the full recovery of California’s economy and real estate market.
According to DQNews.com, home sales in Southern California rose slightly during the month of September 2009 by 0.2 percent compared to the month before, but 5.1 percent compared to September of 2008. However, the median price of Southern Californian homes has declined by about 10.9 percent from $308,500 to $275,000 between September of 2008 and 2009. Some markets, such as Laguna Beach real estate, have shown significant increases in home sales, showing that some regions in California have already hit bottom and are poised for the rebound. Nevertheless, foreclosure rates are still relatively high in the region, and many experts believe that it will not be for another few months that people will begin to see significant improvement. Job security in California tends to be a major cause for hesitation among potential home buyers due to the high unemployment rates.
The OC Register reported that home prices in the Orange County region have increased for the first time int he past two years. September marked the end of the region’s decline in home prices as Orange County posted its first year over year gains in the median home price for the first time in two years. Although the improvement offers hope for recovery in the near future, the increase was only by 0.9% and many experts aren’t confident that the median home price will continue to rise steadily. Nevertheless, the Laguna Beach real estate market was noted as one of the most successful markets according to its median selling prices. The inventory of foreclosed or distressed homes are starting to dwindle in the region, so hopefully the next few months will show stronger sales and higher sales prices.
Like the rest of the nation, Michigan continues to struggle economically as a result of the current recession that began in the fall of 2008. Although many real estate experts urge Michigan residents that now is the ideal time to invest in Michigan real estate, many people are hesitant to buy due to high unemployment rates, the difficulty in selling their previous home, and a lack of consumer confidence. Nevertheless, many experts believe that the real estate market will fair relatively well over the next few months compared to other markets in the nation.
According to the Grand Rapids Press, the annual West Michigan Economic and Commercial Real Estate Forecast expressed a concern for the Michigan real estate market that is believed to struggle somewhat as more and more homes are foreclosed on and less and less people are interested in buying. Nevertheless, those who are willing to search for Michigan homes for sale will find numerous bargains as more and more sellers are desperately reducing home prices in order to attract buyers. The industrial real estate market has fared well throughout the recession, with lower-than-average vacancy rates due to the large variety of modern, industrial facilities that were constructed prior to the 2008 recession. The only major trouble foreseen in the industrial real estate in Michigan is high-tech professions such as doctors leaving older offices for newer, high-tech offices. Because of the large supply of industrial real estate in Michigan, property prices are very affordable.
The grand rapids Press also reports that real estate in Grand Rapids area have declined during the year of 2008. However, many experts believe that 2009 will end with much improvement. Unemployment rates may pose a problem to the recovery of the real estate in Michigan because with an unemployment rate of 9.6 percent, Michigan has the highest unemployment rate in the country. Another problem is that 39 percent of Michigan homeowners owe more on their house than what it is currently worth. Experts believe that the real estate in Michigan cannot fully recover until job security is no longer a problem and consumer confidence is back up.
Due to the recession of 2008, Hawaii’s economy is still struggling, especially due to the sharp decline in tourism, which is the economic base of Hawaii. The real estate in Kona, like the rest of Hawaii, is continuing to decline. However, many real estate experts are optimistic that the rates of decline are slowing and that Kona real estate will begin to recover sometime in 2010.
According to Hawaii news station KGMB9, the construction and housing market throughout Hawaii is continuing to weaken. The University of Hawaii Economic Research Organization has published numerous reports over the past months tracking the state’s real estate market performance. Although they expect the real estate market to continue to decline, they have forecasted slightly lower rates of decline than in pervious months. Nevertheless, they say that some aspects of the real estate market such as median home prices may continue to decline well into 2011. This does offer some hope for the recovery of the real estate market though, because lower home prices mean homes will be more affordable for home buyers.
The Honolulu Star Bulletin also reports that unlike mainland real estate markets, which are already showing signs of recovery and year over year improvements, Hawaii real estate is still declining. The number of combined single family home and condominium sales in Hawaii declined 37.8 percent between the first and second quarters of 2009, but the median sales price increased by 10.15 percent during the same period. However, the rise in median price only evens out with the similar rate of decline experienced during the same time period. Naalehu, located on the Big Island, has experienced a 38.89 percent increase in median sales prices between July 2008 and July 2009, making it one of the most improved real estate markets near Kona. However, Hauula and Volcano on the Big Island suffered some of the worst declines in median sales prices in the state, experiencing a 39 percent drop between July 2008 and July 2009.
The Chicago real estate continues to struggle to improve due to the current economic recession and the numerous economic problems it has caused. Unemployment, foreclosures, and decreasing home values plague the real estate in Chicago and many experts believe that the city will continue to suffer in the coming months and most likely through 2010 and into 2011. Some believe that Chicago’s real estate market has not hit bottom yet and warns people to expect declines to continue in the next few months. Although experts still expect Chicago real estate rates to decline, many are optimistic that the decline seen in the coming months will not be as low as many people expect.
The Chicago Tribune reports that many of the high-end properties in and around Chicago are having a difficult time being sold, with many people being forced to reluctantly reduce prices. Nevertheless, many properties are still much more expensive that people are willing to pay given the current condition of the Chicago real estate. Although realtors are reporting that some ultra-high-end homes have been sold, many are also saying that most homes, despite significant discounts, still take on average 500 days to sell. Lake Forest, a high-end community in Chicago had 20 homes for sale in the $5 million range, and in the past 12 months, only one home in that price range sold. Many people are struggling to sell their expensive homes, and some have resorted to using web sites, neighborhood cocktail parties, open houses, and significant price cuts to sell their home out of desperation.
The Chicago Real Estate Daily predicts that commercial real estate values in Chicago will continue to decline and will not hit bottom until 2011 or 2012 before making a recovery. Although the Chicago real estate market of apartments is expected to start to improve the most and begin to recover significantly by 2011, the retail and industrial real estate markets are forecasted to continue to decline into 2011 and 2012. Many local real estate experts have come to accept the grim future of Chicago’s real estate market in the coming months, but many are optimistic that the market will not decline as much when it hits bottom, even if the market stays at bottom for 24 months.
Although many people believe that Salt Lake City’s real estate market has already seen the bottom and is poised for a rebound, many experts speculate that there will likely be another slight decline in the real estate market before consistent improvement will be made. What’s worse is the Salt Lake City’s real estate market is overflowing with inventory and is full of foreclosed homes and condos, which is causing property values to continue to decline and keep the real estate in Salt Lake City down. Right now many experts are urging people in Salt Lake to take advantage of the home-buying incentives that are currently being offered, but many people are still hesitant to buy.
According to the Realty Times Market Conditions, Salt Lake City experienced about a 26 percent decline in home sales between 2007 and 2008, and as of March 2009, there were slightly over 8,000 Salt Lake City homes for sale. Due to the overwhelming number of homes for sale, median home prices were fairly low at $284,400, while list prices were at $385,217. Nevertheless, many experts in Salt Lake City argue that now is the ideal time for people to buy a home or condo is Salt Lake City with home prices so low and so many high-end homes struggling to be sold. It is reported that one home-buyer was able to buy a property for $800,000 that was once valued at $2.8 million. Although many people may not want to buy a home in the current market, many experts suggest that people searching for a home at least rent a home or condo while you wait for the market to recover.
The Salt Lake Tribune also reports the increasing number of foreclosed properties plaguing Salt Lake City real estate. Realty Trac recorded 3,277 foreclosures in the state of Utah, while 282 of those were in Salt Lake City, putting the city at number 7 in the nation for number of foreclosed homes. The Salt Lake Tribune also reports the effects that these foreclosures are having on the real estate in Salt Lake City. Numerous foreclosed homes in Salt Lake City are not being taken care of, with lawns becoming overgrown and structures beginning to weaken, causing the appearance of a community to worsen, making it more and more difficult for these foreclosed homes to be sold.
Home sales in the Boise real estate market continue their upward movement despite the national trends. According to the Intermountain Multiple Listing service, the number of homes sold in Ada County (which includes the Boise area) hit another month over month high in September with 546 homes sold, up 6.4% over August 2009 and up over 14% from September 2008. The number of homes sold has been trending upward since a low of 232 homes sold in January 2009.
Several reasons exist for the increasing number of home sales in the Boise real estate market including low interest rates, the $8000. tax credit offered by the federal government to first time home buyers and other programs designed to help first time home buyers. Another reason is home affordability. The median home price in September was $162,900., down 20.54% from September 2008.
Yet another reason, closely associated with affordability, is the number of “distressed” properties available. Distressed properties include REO and short sale properties. REO (real estate owned) are homes which have been foreclosed on and are owned by the lender/investor. Short sales are homes whose market value (what they will sell for in the open market) is less than what is owed on the property and the lender/investor has agreed to accept less than the payoff to avoid foreclosure. During the month of September, a large percentage of the total home sales were distressed properties – 119 REO and 100 short sales properties. REO and short sale properties are usually discounted 10 to 15% – creating that affordability factor.
Idaho has had the dubious honor of being one of the top 10 states in new foreclosure filings for several months. According to Realtytrac.com, Idaho currently ranks #5 nationwide in the number of foreclosure filings – 1 of every 97 housing units in the state received a foreclosure filing during the 3rd quarter of 2009. However, there is light at the end of the tunnel. Idaho foreclosure filings were down 19% month over month in September 2009.
Located in the San Diego region in Southern California, the city of La Jolla, like most other cities in the region, has faced its fair share of troubles during this current economic recession. Many of La Jolla’s beachfront properties are reported to have declined in value somewhat, yet they still remain as one of the most expensive throughout the national real estate market. Nevertheless, many experts believe that the Southern California area real estate has hit bottom and should hopefully start to recover in the coming months.
The Arizona Republic has reported that now is a great time to buy a beachfront property in the San Diego area, in oceanside cities such as La Jolla, since many beachfront properties have declined in value by as much as 30 percent. These properties did not take nearly as hard a hit though as San Diego downtown condos and suburbs, which have declined in value by as much as 50 percent. However, La Jolla homes for sale are still of significant value as reported by Coldwell Banker in the 2009 Coldwell Banker Home Price Comparison Index. According to Coldwell Banker, La Jolla has the most expensive real estate market, with over a $2 million gap between the most expensive and most affordable housing markets in the nation. The average price for a home in La Jolla is about $2.125 million, compared to a similarly sized home in Grayling, Michigan, costing about $112,675. Nevertheless, the value of homes in La Jolla have gone down, with The Razor, one of the many famous seaside estates in La Jolla being reduced in price from about $39 million to about $28 million.
DQNews.com has also reported a decline in home sales in Southern California by about 10.8 percent. However, the number of Southern California area homes for sale is still about 11.0 percent higher than August of 2008. This decline is due primarily to the decline in the number of Southern California area foreclosed homes for sale and the increasing concern for job security. However, the median price for new and resale homes has increased slightly by 2.6 percent, the fourth month in a row that has experienced an increase in median home prices, which shows that the real estate in the Southern California area may be beginning to rebound.
Georgia is one of the states hit hardest by the current recession that we are in. As of the summer of 2009, 24 banks in Georgia have failed, more than any other state, and there are still an increasing number of Georgia banks moving towards failure. Unfortunately, Atlanta has been the city that has suffered most from Georgia’s economic problems. The residential real estate in Atlanta, as well as the rest of Georgia, has dropped sharply and still continues to struggle, but now Georgia’s economy is bracing for a sharp drop in the commercial real estate. With still rising foreclosure and unemployment rates, Atlanta real estate and the economy as a whole is expected to suffer well into 2010, with few signs of any recovery in the near future.
According to the Atlanta Journal-Constitution, many experts predict that the commercial real estate in Atlanta is about to take another major hit and deepen the loses in the Atlanta real estate market. Although residential real estate still continues to struggle, with foreclosure rates continuing to rise, signs of a coming decline in the commercial real estate in Atlanta are rising. There are reports of increasing retail and office vacancies, and the rent for commercial real estate is dropping significantly. With rental income dropping and the value of commercial properties declining, many companies are finding it difficult to make loan payments. Nevertheless, many real estate experts are optimistically predicting that the soon to come decline in the Atlanta commercial real estate will not be nearly as devastating as the fall of the residential real estate market.
Housing Predictor has reported than the numerous economic struggles that Atlanta is currently facing are likely to cause the real estate in Atlanta to continue to decline during the next few months. Atlanta is faring the worst of all cities in Georgia, with Atlanta expecting residential deflation to exceed 14 percent by the end of 2009. Many Atlanta developments are being vacated mid-completion, historic properties are being foreclosed on, and unemployment continues to rise. Numerous historic properties in Savannah have been foreclosed on and are still struggling to be sold. Unfortunately Atlanta is expected to experience the most severe decline in residential real estate by about 14.3 percent in the future.
