9:45pm | Pending home sales in California rose in February, according to the California Association of Realtors’ Pending Home Sales Index.
The index was 112.1 in February, up more than 20 percent from January’s revised index of 93. However, the index was down 1.6 percent from February 2010, when housing tax credits played a strong role in home sales, according to the report’s authors.
“The increase in pending sales is typical for this time of year, as we usually see a seasonal improvement in the spring,” said CAR President Beth L. Peerce.
The total share of all distressed property types sold statewide in February rose to 56 percent, up from 54 percent in January and up from 55 percent in February 2010. Of the distressed properties sold statewide, the total share of REO (real estate-owned) sales was 33 percent in February, up from 32 percent in December but down from 36 percent in February 2010.
“Currently I’m seeing buyer confidence rising, but the buyers I’m working with are very uneasy about working with banks,” said Helen Najar, with Re/Max College Park in Long Beach. “They don’t trust the short sale process — have either had their own personal horror story or have heard from many others that going into a short sale can end badly. I’m not surprised in the uptick in sales and agree with the CAR assessment that it’s partly seasonal.
“I would add, however, that sellers seem inclined to put their house on market this year when they weren’t last year. We are still in for a bumpy ride and as I’m certain their agents agree, when there are challenges you work that much harder to protect your buyer and seller clients,” she said
Richard Daskam, a Keller Williams agent who works in and around Long Beach, agrees.
“Our office started seeing successful short sales pick up at the beginning of this year. Files that were just sitting with no response from the banks/investors suddenly were approved,” Daskam said. “In fact, in the past week 50 percent of my opened-escrow short sales were approved in price ranges from $179,000 to $610,000, so they are all over the board. On the other side of the spectrum, I’ve got another short sale file that has been open for 26 months. We’ve sold it six times and the first five times it took the bank so long to respond and approve the file, the buyers had moved on or weren’t willing to accept the bank’s/investor’s terms.”
Daskam said he’s seen a surprising number of “equity” listings on the market.
“These are sellers that aren’t upside down, have equity, and aren’t the banks,” he noted. “Unfortunately, these sellers appear to be pricing their homes higher than what the market will accept, which is supported by their final sales prices being only 97 percent of their asking prices [versus] all others at 99 percent of asking price.
“In my opinion, if equity sellers would price their homes at market value, they would get multiple offers and likely sell for more than they would have if they overpriced their homes,” he continued. “Buyers know that an equity seller can close escrow in a standard amount of time, 30-45 days, [versus] the unknown short-sale time frames.”
The CAR report shows that the statewide median price of non-distressed properties sold in February was $370,000, which is $95,000, or 34.5 percent higher than the short sale median price of $275,000 recorded in February. February’s median is $170,100, or 85.1percent higher than the February REO median price of $199,900.