2015 marks the year that the high end fully recovered posting the highest
number of $1 million plus home sales since 2005.
The Luxury Market: one-third of all homes that are listed “for sale” are over $1 million.
Today, there are only 205 total foreclosures and short sales on the active listing market in Orange County. In contrast, there are 2,040 homes priced at $1 million and up. In October, there were 348 sales at $1 million and up; yet, there were only 86 closed distressed sales. The distressed market is down to 2007 numbers, edging closer to pre-recession days. It’s almost no longer worth mentioning. On the other hand, the luxury market is back with a vengeance, posting numbers in 2015 that have not been seen since 2005, one of the hottest years in Orange County real estate.
For the luxury homeowner, this is great news. But, don’t misread this. Just because the luxury housing market’s numbers are back, it is not a pass to place a home “for sale” and have instantaneous success. Instead, it’s a tough market with tremendous competition among other luxury sellers. The number of buyers that can afford to purchase in the higher ranges is much more limited, so it takes a bit longer for realistic sellers to find success.
Luxury homeowners are much more apt to overprice their homes. Yes, overpricing is rampant in every range, but it is at an epidemic level in the upper ranges. In taking a closer look at the 348 closed sales at $1 million and up, 83% had to reduce the asking price at least once in order to find success.
The biggest issue in the luxury market is that many homeowners place their homes on the market with expectations based upon articles written about the feverish pitch of the Orange County housing market for the past few years. They hear about multiple offers and closed sales higher than their asking prices. Homes are seemingly selling about as fast as they come on. But, you have to be careful in what you read. There are price ranges that are extremely hot, but they are primarily referring to homes priced between $250,000 and $750,000. That range accounted for 72% of all closed sales in October. The luxury price range only accounted for 14% of all closed sales.
Luxury sellers quickly find out the hard way that their market is vastly different than the Orange County housing market that they read about. Homes don’t necessarily fly off the market.
Come and join architecturally passionate friends for a presentation on the unique California native architecture on Friday, November 20th at 6 o’clock at Studio 12.
When the Spanish first arrived in today’s California there were over sixty tribes throughout the West Coast. Each had their own traditional cultures and different environmental and climatic factors to deal with. This resulted in a wide assortment of buildings types and styles, based on the local resources of materials available.
The result is a fascinating array of different creatively built structures that will be shown and discussed by cultural anthropologist, Stephen O’Neil. The presentation will present a review of structures, including residences for nuclear families and lineage groups, sweat lodges, ceremonial structures, granaries and workshop shelters. The range of materials will also be shown, including brush structures of willow and tule, bark slab lean-tos, cabins of timber, semi- and fully subterranean structures, and open enclosures.
O’Neil also has archaeological experience, mostly on Native American prehistoric sites, but also Spanish, Mexican and American period adobes. He has published in the Journal of California and Great Basin Anthropology, the Pacific Coast Archaeological Society Quarterly and many more journals.
LFA looks forward to seeing you on Friday, November 20th at 6 o’clock at Studio 12 starting with some wine to get you in the mood.
Yurok – Humboldt County
Maidu – Chico County
Sonatasia and Emmy-nominated producer-director Pamela Peak bring the spectacular On Impulse Acting Troupe to a stunning private home high in the hills of Laguna Beach. You will be transported back 100 years to the sleepy town of Spoon River, as the actors appear all around you, each unfolding their unique story. The home, a modern masterpiece designed by Laguna Beach architect Horst Noppenberger, sits high in Mystic Hills with a sweeping ocean view.
Thoughtful, amusing, sorrowful, and sometimes disturbing, these haunting and moving stories, penned by famed American author Edgar Lee Masters, first appeared daily in Midwestern newspapers and then went on to captivate the nation. Each character tells his or her individual story as a resident from a fictional town of Spoon River. This magical performance commemorates the 100th anniversary of this classic work. Tickets can be purchased online here: http://www.brownpapertickets.com/event/2432843 Note: due to limited space, there will only be 50 tickets available for this event. Please RSVP!
Sontasia is more than a performance. It is a thrilling experience of music, theater, and dance which unfolds all around, the performers close enough to touch. There is no stage. The performance is everywhere! Sonatasia was created by architect David M. Parker.
The On Impulse Acting Troupe was founded in 2011 by Emmy-nominated Producer/Director Pamela Peak, and has appeared at numerous venues around the Southland, most recently Carbrillo Playhouse in San Clemente. Some of their performances have been “The Odd Couple”, “The Grass Harp”, and “Of Mice and Men”. Ms. Peak teaches Sanford Meisner’s acting technique called, “a secret”. The ultimate goal is for the audience to see a reality transform in front of them rather than just to see individuals acting.
Come and tour the spectacular home, see the architecture, meet new people, and enjoy an enchanting theatrical experience you will always remember. Don’t miss this wonderful event!
“ TO ATTEND THIS UNIQUE EVENT, YOU MUST RSVP at: email@example.com – or call (949) 305-5496 and leave your name, number and the number of people in your party. This is mandatory due to limited seating capacity. TO SECURE A SEAT, PLEASE PURCHASE TICKETS ONLINE HERE: http://www.brownpapertickets.com/event/2432843
All of us at Laguna Friends of Architecture are sadden by Mark’s succumbing to cancer and thank him for his indelible influence on all of us that live in Laguna. In particular, he helped LFA become 1,400 friends strong by giving us instant credibility when we were just starting, as one our first speakers talking about how he made his houses earth friendly. This house was the first Platinum LEED compliant in the area, the highest level possible.
I could go on and on about Mark’s life, which the local papers have done a great job at, but especially with architecture being the ultimate art form since it shapes every one of us, it’s best to describe him by pictures and videos of his work. Click here to view the full article
The last time prices were this high it lead to a major housing price correction. Logically, prices are about to drop again, right? Not necessarily.
The prior OC median sales price record was established in June 2007 at $645,000. The median sales price last month was at $610,000. During the Great Recession, the median low hit $370,000 in January 2009. So, August’s level is 65% above the recession low and just 5.4% away from matching Orange County’s record height.
The prior height was established 8 years ago. Even though inflation has been extremely mild, the Consumer Price Index in Orange County has been positive for years. Taking into consideration the slower, mild growth in overall prices, Orange County is closer to 15% off the prior peak, not 5%. Buyers are mistakenly comparing today’s prices to 2007, that’s 8 years ago, a long time ago.
And that’s with minimal wage increases which now are getting upwards pressure. Also, most of the loans made over the past 6 years have been strictly underwritten and foreclosures/short sales are incredibly low. Lastly,the inventory is the lowest in September since 2012 which keeps it a sellers market.
BUT if you are buyer there is a niche to explore for a good price. Many Laguna sellers are now doing a price correction on their prices since they set prices in ‘anticipation’ of Spring time’s higher pricing continuing. This resulted in many homes to be still on the market for a much longer time then desired which makes the seller anxious.
It’s not a 20% drop or anything but you’ve some leverage in a weakened seasonal sellers’ market.
Laguna active ‘for sale’ properties that have decreased their prices:
So in a way there has been a price correction or slow down but not to the major levels that some were hoping for. Will the increase in interest rates impact prices? We’ll see, but with inventory is still low and I don’t see it happening unless it goes a couple points up.
Closed sales in September popped back up to 34 homes which is right on par for the last few years.
However, homes going into escrow, which show the true sales activity for the month, was down to a 6 year low of 48 homes (tying 2013).
But when the New Year started in 2014 the sales activity increased dramatically.
Lastly, the inventory is at 236 homes the lowest since 2012.