Signs of Improvement

Six single-family homes and condos have sold and closed escrow in the Malibu area (everything in the 90265 ZIP code) this month. Four were listed as standard sales and two as short sales. None was a bank-owned/foreclosed property.

As was the case in January, Malibu in February (so far) has had a greater percentage of standard sales than distressed sales. These distressed sales, such as bank-owned or short sales, are much more predominant in other cities. 

Per data from the CLAW MLS system, the median price for single-family homes sold on the landside of Malibu for the fourth quarter of 2010 was $1.75 million, up from $1.455 million in 2009. Nationwide, the single-family sales are dragged down by the distressed sales, where properties are sold at deep discounts below market value.  However, looking at the inventory that has sold in Malibu, one sees that traditional homes in good condition are selling as standard sales and not distressed.

The National Association of Realtors just released the housing report for January sales of previously owned homes. Keep in mind, national reports generally do not follow the local trends in Malibu. According to the report, January sales numbers from this year were far above the numbers from January of a year ago. According to the report, “this past January is the first time in seven months that sales activity was higher than a year earlier.”

Lawrence Yun, NAR chief economist, said the improvement is good, but could be better.

“The uptrend in home sales is consistent with improvements in the economy and jobs, which are helping boost consumer confidence,” Yun said. “The extremely favorable housing affordability conditions are a big factor, but buyers have been constrained by unnecessarily tight credit. As a result, there are abnormally high levels of all-cash purchases, along with rising investor activity.”

Investors accounted for 23 percent of purchases nationwide in January, according to the NAR report. That is up from 20 percent in December and 17 percent in January 2010. I have brokered two Malibu sales in January, and both of those sales were to investor clients.

The NAR reported there were “increases in all-cash transactions, the investor market share and distressed home sales all go hand-in-hand. With tight credit standards, it’s not surprising to see so much activity where cash is king and investors are taking advantage of conditions to purchase undervalued homes.”

In the Malibu market, I have found that many of the deals were completed with cash.  Therefore, Malibu real estate sales are consistent with the national trends regarding investor type sales.

Beverly Taki is a California-licensed real estate broker who has represented clients in Malibu for 22 years. She is a Malibu resident and president/broker of Seabreeze Estates Realty. Taki can be reached at beverly@beverlytaki.com or 310-456-4843. Her website is beverlytaki.com.