usctrojancpa
Well-known member
paydawg said:USCTrojanCPA said:OCtoSV said:lnc said:USCTrojanCPA said:Here's the crazy thing, if I were to exclude Irvine resale homes >$1m we are closer to 1-months of inventory. Inventory and sales volume numbers don't lie, they give a picture of where supply and demand are. This is why new home developments like Petaluma, Helena, Avalon, Trellis Court, etc have been selling so well. Also, part of the resale inventory you see WTF asking prices...those are not real sellers in my opinion just home owners looking to find a sucker given the low level of inventory.
The people who are Irvine buying home are strong financially and 80-90% of the offers that I have seen in the few years are from buyers who are putting more than 20% down. The underwriting to get approved for a loan today is legit and probe deep (I speak from personal experience). Until more inventory comes on board and we get over 3 months of resale homes on the market, don't expect prices to dip because at best they'll stay flat.
1 month of inventory! That's extremely low.
I have a feeling that the under $1M inventory will never exceed 3 month of supply here in Irvine.
Between 2013 to 2016, over 11,000 new home were sold here in Irvine and we have about another 11,000 to go until they run out of land. However, less than half of future new build will be homes that are under $1 million dollars.
With lack of inventory of under $1M existing homes and limited supply of future new build in this price range, that under $1M market are going to be extreme hot for a very long time.
As of today there are >100 SFRs <=$1M, almost triple that if you include attached properties. Compared to SV Irvine is drowning in inventory.
You can't compare Irvine to San Jose like that....it's like comparing apples to oranges. There is about 1 month of resale inventory for Irvine properties under $1m which indicates a strong seller's market. We were below that back in 2013 when we saw prices rise by about 20%. It's not as crazy as 2013 but decent properties around comps go into escrow fast today and often times slightly above previous closed comps. We are currently selling 250+ per month (not including new home sales) and there are only a total of 450ish active MLS listings today (all listings) so you see we are below 2 months of inventory for the entire market on average....still a strong seller's market.
Just for the sake of argument, is there a way to make that an apples to apples comparison? What if you compare sub-$1M Irvine homes vs sub $1.5M SV homes? i'm guessing it's not that simple, but thought i'd ask.
I don't know the SV market very well so tough for me to say. Is the SV market even stronger than Irvine? Most likely as there is a lot of more tech money up there than in Irvine. The inventory supply doesn't include the shadow inventory supply that I mentioned so the market on paper looks stronger than it really is in Irvine and definitely not as crazy as it was in 2013 hence we aren't seeing the same level of price appreciation.