Ventura County Inventory Levels Continue to Rise

Inventory levels of Single-Family homes in Ventura County continues to rise.  The number of single-family homes available to purchase in Ventura County is up 37% from the same time a year ago based on the last 12 months of closings.  

The number of homes for sale is up by 26% from the same time a year ago and the number of closings is actually down by 18%.  So, this gap has created a growing number of homes on the market.  We have seen increases in all areas of the housing market with the exception of the market over $1,000,000.  The inventory of homes available in this market is flat on a month-to-month basis as well as looking back 12 months.  Certainly you know the phrase that "all real estate is local" but that is certainly true here.  While these numbers reflect the general trends, your tract, your neighborhood, your city might look different than this.  So, if you are located in Santa Rosa Valley or Camarillo or Thousand Oaks or if you are located in The Pinnacle or Village at the Park or Lynnmere or Rancho Santa Rosa, these numbers and this assessment may not apply to you.  Call me if you are interested in a more local review of the situation for your particular piece of real estate. 

The biggest drop that we have seen in terms of overall activity is one of the things that I have been concerned about (and that we continue to hear about in the news) and that is the entry-level buyer.  We keep hearing that first-time homebuyers are not participating in this market and the data would seem to support that claim.  Because these buyers are missing from this market, the result has been a decline in the demand for housing in our middle market, where most of activity happens.  Just look at the chart below and see the drop we in had in the activity level in sales from $400,000 and below.  

This market over the last two years has made up over 32% of the total sales in all of Ventura County, yet in October, it only accounted for just under 18% of our total number of sales.  We need to see this market return, otherwise it stagnates the move-up activity and really begins to shut down the real estate markets.  In order for this to happen, we will have to see a drop in the First-Time Homebuyer Affordability Index (FTHB HAI).  The FTHB HAI is made up of three basic ingredients:  Median Home Price, Median Income and Average Mortgage Rates.  All three of these have dropped dramatically during the period of time when the real estate/mortgage markets crashed around 2006.  The good news is that values and mortgage rates all came down but the problem is that so did the Median Incomes in California.  Below, you can see how all three factors were affected during this period of time.  

Median Price

Average Mortgage Rates

Median Income

While we have seen the California Median Income recently come up off of its lows, we did not hit the bottom until the 1st Quarter of 2012.  In order for things to improve for First-Time Homebuyers in areas like Camarillo and Thousand Oaks and Moorpark and Simi Valley and Oxnard and Ventura, we have to see the Median Incomes rise faster than either Mortgage Rates and/or Median Prices.  This means jobs, jobs, jobs!  We need better jobs and we need more jobs.  We need our college graduates to get to work.  Once this starts to improve, I am confident the market will continue to look a lot more normal.  

Have a great day and don't forget to let me know if there is anything I can do to help you, your family or friends with any of their real estate needs.