South OC home stats, May 2

Here are the latest home stats as reported by the OC Register. The DataQuick data is for the 22 business days ending April 14.




Steve Thomas from Re/Max is reporting that pending sales are now higher than they were at the same time last year. Here is his chart:

Some quotes from his newsletter, which covers market data through May 1: "The first time home buyer wave continues to grow and plant the seeds to an eventual recovery. The reports from the streets of Orange County are unanimous: first time home buyers are fueling a surge in activity that continues to flourish and has been steadily growing since the middle of February. ...

"Demand, a snapshot of the prior 30 days of escrow activity, has climbed by an additional 166 escrows in the past two weeks to 2,540. Last year at this time, demand was at 1,863 escrows, 677 fewer than today. Two years ago it was at 2,701, or 161 additional escrows."

So far, Thomas' increasingly optimistic pending sales data has not translated to year-over-year sales increases in the DataQuick numbers - sales are still down virtually across the board in Orange County, which likely means one of two things: a) the DataQuick data lags far enough that it does not yet reflect what is actually going on in the market, or b) the amount of properties falling out of escrow is enough to counteract the increased number of pending sales.

Thomas' assertion about the "surge in activity" that "continues to flourish" does not address the fact that pending sales usually peak in the early part of the year (which makes perfect sense, since more sales typically go on to close in March and April than in other months of the year) and steadily drops off the rest of the year, once the peak is reached. This year it does not look like March and April were especially strong, but pending sales are still increasing.

We may, then, be in for a better May. Maybe we will see a story like this:

"The county's new-home market caught fire...as sales shot up while inventory went down.

If both trends continue, real estate analysts said the county's housing slump could be over by the end of this year.

"We're seeing indicators that show the economy is in a similar situation to what it was (in July of) last year. The big difference is that buyers now are confident. They are perceiving that this is the end of the down cycle, not the beginning," said John Shumway, president of Market Profiles, a real estate consulting company in Costa Mesa.

Or perhaps not...This story was printed in the OC Register in March 1991 - about four years before the actual end of that down cycle.