Reporting: Slipping home prices won’t last

Despite recent softening, Bakersfield’s single-family home market will likely see price increases in the 12 percent to 15 percent range this year as previously foreclosed homeowners look to buy houses again, a leading local observer predicted Tuesday.
Bakersfield appraiser Gary Crabtree made the forecast in a monthly housing update stating that median home sale prices in the city fell 6.1 percent in January to $195,250.

That median — defined as the point at which half the homes sold for more and half sold for less — was still 18.9 percent greater than the local market saw in January 2012.

The signs of cooling were fairly pronounced in January data, however. The number of home escrows that closed that month was 371, 6.5 percent less than December’s totals. Meanwhile, the inventory of homes for sale in the city grew by 1.6 percent to 945, Crabtree reported.

Cash investors who flooded the local market in recent years, sometimes squeezing out would-be homeowners, have already begun exiting the market, Crabtree noted, largely because rental prices have not kept up with local home price appreciation.
Their exit may present buying opportunities for people who lost their homes to foreclosure during the recession, even as it could hurt the rental market, Crabtree wrote.

“In 2014, I expect to see the ‘boomerang’ (previously foreclosed homeowner turned tenant) buyer replace the investors, thus supplying demand for a moderate increased in pricing,” he wrote.

“However, this will also place a downward pressure on rental prices as the single family rental vacancy (rate) increases with the loss of this market segment.”

Local residential real estate investor Frank St. Clair generally agreed with Crabtree’s assessment. The one point he disputed was the assertion that January was a slow sales month.
In fact, St. Clair said, home sales picked up noticeably in the middle of January — something Crabtree’s data wouldn’t show because they reflect transactions that can be from November and December.

“Right about the 15th (of January), it really started picking up dramatically,” he said.

The recent sales spurt looks like it could carry on through summer, St. Clair predicted, adding that he believes Crabtree is right about increasing demand from people who listed their homes to foreclosure a few years ago.

“We will get overall appreciation” as high as 15 percent this year, he said.

BY JOHN COX Californian staff writer jcox@bakersfield.com

Tejon Ranch officials reveal 16 retailers at Outlets

Tuesday, Dec 10 2013 05:17 PM

Tejon Ranch Company officials on Tuesday revealed 16 of the 70 retailers coming to The Outlets at Tejon Ranch, when the first phase of the 320,000-square-foot, $90 million shopping center opens Aug. 7.
The tenants, whom officials said had signed lease agreements with Tejon Ranch Company, are: Aeropostale, A’gaci, Auntie Anne’s, Carlisle, Chico’s, Coach, Hot Topic, Lids, O’Shoes, Perfumes 4U, Puma, Rack Room, Skechers, Tilly’s, White House Black Market, and Wilsons.

“When we did our due diligence in the beginning, we wanted to make sure there was a market — if you built it, they would come,” said Tejon Ranch Company senior vice president of real estate Joseph E. Drew, in remarks during the Greater Bakersfield Chamber of Commerce’s lunch forum, “Bakersfield: The Next 5 Years.”
By way of confirming the commercial potential for the Outlets, which will be on the east side of Interstate 5 south of the Highway 99 interchange, Drew referenced two Thanksgiving week incidents at Tejon Ranch Commerce Center on the west side of the interstate.

On Nov. 27, Drew said, all five bays at the Tesla Motors charging station were simultaneously full of power-hungry Teslas — a first. Then, from Nov. 28 through Dec. 1, the Commerce Center Starbucks was the chain’s No. 1-selling store in the nation.
“It’s evidence that the location where the outlet center is located has always been a very popular stop for folks, and we believe that the outlet center will now transition into a destination,” said Barry Zoeller, Tejon Ranch spokesman, in an interview.

Starbucks officials could not confirm the store’s performance. Tesla Motors officials did not respond to a request for comment.
All but two of the retailers announced — Auntie Anne’s, a pretzel company, and Perfumes 4U — sell clothing or accessories.
More significantly, seven of the retailers, including Coach, Chico’s, Aeropostale and Hot Topic have full-price stores in Bakersfield, about a half-hour away.
Anthony Olivieri, principal at Olivieri Commercial Group, which handles marketing and leasing at The Marketplace, said this is proof that retailers are loosening so-called “radius restrictions” mandating full-price stores stay far away their discount brethren.
“A lot of those rules, those unwritten codes, have been softened. Retailers realize, like the Gap and the Banana Republic concept — they manufacture product specifically for outlet malls,” Olivieri said. “You get higher end brands at a discounted price-point and I think that’s attractive to a lot of people.”
When its second phase is completed, the shopping center will be 500,000 square feet. Zoeller said Tejon Ranch Company believes it will generate $400 in sales per square foot of retail space per month — or $128 million in sales per month.

BY THEO DOUGLAS Californian staff writer tdouglas@bakersfield.com

Real estate experts say local ‘mini-bubble is over’

BAKERSFIELD, Calif. (KBAK/KBFX) — The real estate market in Bakersfield is “in recovery” and trending toward “stabilizing prices.” That’s the view of long-time analyst Gary Crabtree. He said the market is changing from a sellers’ advantage to a buyers’ advantage, though others see opportunities for both.

“You might say the mini-bubble is over,” Crabtree told Eyewitness News on Monday. “We should see some transition back into a normal market.”

From Affiliated Appraisers, he’s been tracking the local market since 1993.

The last few years have been anything but normal, starting with the real estate bubble and then the effects of the bust of 2006-07.

Now, Crabtree said he sees prices coming down and starting to level off.

He said August saw a peak, with the median home price at $199,400. As of October, was $185,000.

Crabtree said that’s a drop of 7.2 percent, but the October median price is still 19.4 percent higher than a year before.

He admitted prices do dip in winter, but he sees a trend.

“We’re seeing a little more decline in prices this winter than we have in the last two winters,” Crabtree explained.

Also, the number of homes on the market is up. On Monday, he saw 1,001 homes for sale, saying that’s about 70 percent more than a year before.

More houses for sale and lowering prices make things better for buyers, he said.

But, Realtor Scott Tobias also sees good news for sellers.

“Right now, it’s a window of opportunity,” Tobias said.

For buyers, the interest rates are good.

“They’re still low,” Tobias said. “And, I believe they’ll go higher by the end of the year.”

He said there are “great” opportunities for buyers to get loans while prices are still reasonable, and thinks buyers with good credit should be able to buy.

Tobias said for sellers, prices are better than a year ago, and many owners now have more equity in their homes.

Both Tobias and Crabtree said investors are no longer in the market, snapping up homes in foreclosure to rent out.

“Investors pulled out of the market three months ago,” Crabtree said.

But, those people who lost homes to foreclosure or short sales are now more likely to be back in the market as buyers.

“Now we have cleared that three-year barrier that the government set, and now they can buy again,” Crabtree said. He called these the “boomerang buyers.”

“Now they’ll be able to leave the rental market,” Crabtree said.

While that means more buyers, Crabtree said another trend spells fewer homes for sale. He said residential construction appears to be declining, because the number of building permits is down.

“(The builders) were averaging a little over 100 permits a month for 2013,” Crabtree said. “In September, they only pulled 57.”

But, the buyers also face challenges because of the current economy.

“It’s still rather weak,” Crabtree said. “Unemployment is rather high, we don’t have meaningful job creation.”

Winter is the “off peak” period for real estate, but Crabtree said there are some special changes in the latest local data.

“It leads me to believe that going forward into the year 2014, it is not going to be anything like what we’ve experienced in 2013 and the latter part of 2012,” he said.

By Carol Ferguson, Eyewitness News Nov 11, 2013
http://www.bakersfieldnow.com/news/business/Real-estate-experts-say-local-mini-bubble-is-over-231525971.html?mobile=y

Is FHA able to endorse single-family loans if the government shuts down?

FHA LOANS WILL STILL BE PROCESSED BYT WITH LESS WORKFORCE SO EXPECT A DELAYS.

The mortgage market took the time to dig through the Department of Housing and Urban Development’s contingency plan for dealing with a government shutdown last week.

And industry professionals did a nice job reading the fine print, because the fine print changed over the weekend, creating some confusion as to whether HUD will be able to endorse single-family loans in the wake of a government shutdown.

The simple answer: They can endorse single-family loans, but this is a major change from what was reported by HUD on Friday.

HousingWire, along with other news outlets, discovered on pg. 42 of the contingency plan — underneath frequently asked questions — that as apart of HUD’s shutdown plan, the Federal Housing Administration would be unable to endorse any single-family loans. Furthermore, the report said FHA staff will not be available to underwrite and approve new loans. However, all of this was reported Friday, and the contingency plan changed over the weekend.

When I arrived at my desk Monday morning, I received various phone calls and emails informing me that HUD has updated its contingency plan from what was originally reported.

The truth is FHA will be able to endorse single-family loans during the shutdown. In addition, a limited number of FHA staff will be available to underwrite and approve new loans.

This change was quite abrupt, with many industry analysts shaking their heads saying, it’s “kind of important, don’t you think?”

After reaching out to HUD, staff from its Office of Public Affairs confirmed the plan currently on its website is the correct, updated version.

While it’s clear the former and current plans caused quite a few of us to scratch our heads, the housing agency has taken more steps than it did in 2011 when a similar government shutdown challenged the agency.

However, it’s no joke that any sort of government shutdown will require federal employees to cease working.

When put into perspective, of the roughly 9,000 HUD employees, only 350 employees will continue working after a shutdown — that’s only 3.8% of its staff.

Since everything with the government is still up in the air, we’ll cut HUD some slack because let’s face it, the possibility of a shutdown is enough to leave any entity uneasy.

The takeaway: Always read the fine print. The smallest change can make a world of difference.

Article by: Christina Mlynski
http://www.housingwire.com/blogs/1-rewired/post/27128-is-fha-able-to-endorse-single-family-loans-if-the-government-shuts-down

Clear Capital(R): Bakersfield, CA Tops Metros With Largest Projected Gains Through Last Half of the Year. Really.

Las Vegas Projected to Lead Metros With Total 2013 Price Growth.

TRUCKEE, Calif., July 2, 2013 (GLOBE NEWSWIRE) — Clear Capital (www.ClearCapital.com), the premium provider of data and solutions for real estate asset valuation and collateral risk assessment, today released its Home Data Index(TM) (HDI) Market Report with data through June 2013. Using a broad array of public and proprietary data sources, the HDI Market Report publishes the most granular home data and analysis earlier than nearly any other index provider in the industry.

June 2013 highlights include:

— The forecast through June 2013 reveals trends that highlight the overall
recovery’s strength and potential for sustainability. Nationally, home
prices continue to benefit from the more active spring buying season.
— Quarterly, yearly and two quarter forecasts all came in stronger at 1.4%,
8.6%, and 1.7% respectively, relative to months past.
— A more optimistic update to our total 2013 national forecast of 6.0% over the 2.6% growth projected

in our April 2013 report is attributed to increasing home price gains across much of the nation, continuous

improvements in distressed market measures and improvements in broad-based economic inputs, such as

consumer confidence.

— Should 2013 forecasts be realized, the housing market would outperform
historical average gains between 4.0% and 5.0%, but indicate moderation
from the current yearly gains of 8.6%.

— Regionally, home price gains saw moderate growth in the short-term,
long-term and forecast.
— The West, South, Midwest and Northeast are forecasted to see total 2013
gains of 10.1%, 5.2%, 4.6% and 4.1%, respectively. These gains are
comprised of year-to-date growth and two quarter forecasts of 2.2%, 1.5%,
1.8% and 1.5%, respectively. Moderation is key to a sustained recovery.
With this in mind, projected regional growth rates are healthy compared
to year-over-year gains through June of 17.1%, 7.1%, 6.2% and 4.3%,
respectively.
— While metro level market trends showed continued variability, they
remained positive overall. Local market economic fundamentals continue to
drive varying degrees of price growth.
— 45 out of the top 50 major metro markets are forecasted to see yearly
growth over the final two quarters of 2013. Four of the five markets not
expected to see home price gains over the next two quarters are projected
to see declines of less than 0.5%.

— Las Vegas held its lead in June with yearly gains of 29.3%. The metro is
one of six others to have realized more than 20.0% in yearly growth.
Considering the two quarter forecast for Las Vegas of 5.0%, the metro
will likely end the year as the recovery front runner with total 2013
gains of 19.4%.

— Bakersfield, CA’s two quarter forecast of 5.2% puts this metro in the
lead for short term anticipated gains out of the top 50 metros.
Bakersfield moved from 29 in March’s Forecast to the first position in
June. This leap is an example of the fundamentals driving the overall
recovery. Bakersfield shares many characteristics of a First In First Out
Recovery and serves as a reminder that the recovery continues to unfold
market by market. This market was hard hit in the downturn and now offers
an attractive opportunity for homebuyers. From the peak, prices are
currently down 54.3%, substantially more than the national losses of
34.2%. Additionally, REO saturation remains relatively high, but on the
decline at 21.3%. And overall median prices are relatively low at
$160,000.

continue reading…

All-Cash Offers: Healthy for Real Estate Market, or a Hindrance?

With many pointing to the housing market as the backbone of the economic recovery, investors are flooding the market with all-cash offers and it’s squeezing out many traditional homebuyers.

“People are worried about the returns on alternative investments,” says Karen Dynan, vice president and co-director of economic studies at the Brookings Institute. “There is still a lot of uncertainty about bonds and the stock market, which makes the housing market look good.”

According to the National Association of Realtors May 2013 Confidence Report, all-cash offers account for 33 percent of home sales, with international buyers taking the lead. In addition, 87 percent of surveyed Realtors say they are expiring constant or increasing home prices. Homebuyers, particularly first-time homebuyers, are already battling low inventory and rising home prices, but the added pressure from investors creates stiff competition.

William Delwiche, investment strategist at Baird Research & Insights, says cash buys are being bolstered by investor pools snapping up real estate, and less so by individuals looking to live in the home. “These are investment pools paying cash for houses to hopefully get returns,” he says. “It’s not necessarily a trend among individual homeowners because most people going to buy houses don’t have that kind of cash sitting around.”

And for sellers, an all-cash deal is ideal since is cuts down on complications, says Patrick Newport, U.S. economist at IHS Global Insights. “If you own a home and are selling yourself, it’s probably easier if someone pays you cash — it cuts out the messiness and having the homebuyer get approved for a loan.” Typical cash buyers are either young people who come into a lot of cash, or international investors, he says.

Cash buys signal a housing market that people are more willing to invest in, says Delwiche, but the market’s attractiveness may also be due to a lack of other solid investment options. “The housing market is recovering, but people are also looking to diversify their portfolios,” he says. “They don’t’ want to put it all in stocks and bonds.”

It’s a sign that people are under the impression the market is turning around, says Dynan, which may be a self-fulfilling prophecy if enough investors follow. “A lot of those cash investors are looking for a return,” she says. “If a lot of people think home prices will rise, they will put money into the market, and that increases demand and pushes up prices.”

The cash-buying trend also gives the overall economy a short-term boost, according to Delwiche.
“This helps to bid up asset values for houses, and is good for homeowners who already own houses,” he says. “There is also a benefit to state and local government finances because of the taxes associated with these purchases.”

Dynan says the trend will reinforce the momentum in the housing market, but will impact hopeful first-time homeowners negatively in the future. “It just makes the housing market less affordable,” she says. “It’s good for the overall economy, but not for every person in the economy.”

Delwiche agrees, and says it may prevent more people from getting into the market in the future.
“Home prices go up and it affects housing affordability,” Delwiche says. “You can’t have first-time homeowners who are seeds for long-term growth, because they are then crowded out of the market. So short term it’s something of a positive, but is a headwind for first-time homeowners.”

Delwiche says he’d be surprised to see the trend continue, as well. “It’s just a reflection of poor alternatives for investment dollars,” he says.

By Kate Rogers
http://realestate.aol.com/blog/2013/06/28/all-cash-offers-healthy-for-real-estate-market-or-a-hindrance/

Investors have swooped in — quickly

Many had little or no presence here before the bust. But they have quickly become some of Kern County’s biggest homeowners.

What distinguishes them now is how long they plan to keep their money here. While there is still plenty of rehab and “flipping” activity, some investors in the local home market have embraced their new role as landlords.

This view of Bakersfield’s latest housing investment boom, based on a Californian analysis of home sales data on the county’s top 20 homeowners, as well as interviews with investors, shows how appealing the local home market remained even during and after a devastating real estate crash.

And it has happened quickly.

Half of Kern’s 20 biggest single-family homeowners have at least tripled their inventory here since the end of 2006, which is generally acknowledged as the beginning of a bust that ultimately hit bottom in spring 2009.

Sixteen of the top 20 have each spent a total of more than $1 million on homes in the county since Dec. 31, 2006. Seven have invested more than $4 million since then, and one has invested $9.3 million.

A BIG FISH

That last one, Westlake Village-based Alta Community Investment, owns 100 single-family homes in Kern County; all but four of them are in Bakersfield. The county’s second-largest homeowner after a Bakersfield-based partnership, Alta bought all of these properties between March 16 of last year and Jan. 18, according to county home sales records.

The company’s chief executive is Todd Kaufman, a former Wall Street bond trader and mortgage broker with Washington Mutual, the Seattle-based home lender that collapsed in the 2008 financial crisis. With about 65 investors across the United States, he said, Alta owns homes throughout California and in other states, though Bakersfield is “among the larger” areas of investment.

Kaufman said Alta will probably buy more homes in Bakersfield before long.

“Were just refueling for more capital,” Kaufman said, adding that the company intends to keep its local properties for the long term.

A very different investment strategy applies at a group of funds managed by Bakersfield home flipper Miguel Soltero. Together, the various funds — backed by what he calls a “closely knit” group of friends, family and business acquaintances — owned about 60 Bakersfield properties as of March. That made them, as a group, one of Kern’s top 10 homeowners.

County home sales records show that Soltero’s group bought the majority of the properties since the fall of 2011, though some of those investments date back to 2002 and earlier.

Soltero said the group’s guiding strategy is not to rent out these properties but fix them up and sell them at a profit. It’s less capital-intensive than buying and holding, he said, and more profitable, too.

“We have enough rentals to know that, at the end of the day, it hasn’t been that lucrative for us,” said Soltero, a Los Angeles native who moved to Bakersfield at the height of the real estate bubble in about 2005. “We make more money buying, rehab’ing and selling.”

FLIP, OR BUY AND HOLD?

There seems to be little consensus on that conclusion. Indeed, county records show that almost all of Kern’s top 20 homeowners still own local homes they bought four or more years ago, even as much of their investment here has taken place more recently than that.

Becoming a landlord can make good financial sense for investors able to park their money in the real estate market, said Bakersfield Realtor and broker Frank St. Clair, who heads a diverse set of investment groups that together own more than 50 homes in the city.

The return on investment from a single-family home offered for rent averages between 5 percent and 7 percent a year, he said. That doesn’t include the property’s price appreciation, which in Bakersfield hovers around 20 percent per year lately.

St. Clair has made both kinds of investments — for his family trust as well as for his investor customers. Lately his focus has been on flipping homes, given that he and his family owned more than 1,000 local apartment units and rental homes. “We’re rentaled out,” he said.

Some of his customers are not. He said they send him a cashier’s check for the price of the home and he manages it for them as an income property.

“We know how to do it where it’ll make money,” he said.

One reason why Bakersfield makes an attractive place to buy income property, investors say, is the local economy.

Kaufman pointed to Bakersfield’s “well-balanced economy,” with its oil and ag strength complemented with manufacturing and financial services.

Soltero agreed but added that the city’s affordability has been a big factor in luring investment.

“It’s a cheap place to live,” he said. “Your dollar goes a long way.”

BAKERSFIELD FOCUS

To be sure, much of the county’s recent home-buying has been concentrated in Bakersfield.

Fifteen of Kern’s top 20 homeowners have chosen the city for at least 85 percent of their home purchases since the end of 2006. Nine bought homes nowhere else in the county during this period.

Their collective investments span the city, even as the majority of their holdings are located east of Highway 99. Also, different investment groups have focused their activity in certain geographic clusters.

County home sales records show that the ZIP code that has received the greatest investment is 93304, on the east side of the 99 near Stockdale Highway.

The second-biggest investment cluster is in the 93306 ZIP code, in northeast Bakersfield, followed by the 93307 ZIP code further south.

The clusters themselves reflect distinct investment strategies, as some neighborhoods command higher prices than others.

For his part, Kaufman said he’s bullish on the city’s lower-end homes. Accordingly, his company has invested mostly in Bakersfield’s eastern and southern areas.

“Everybody’s got their own opinion,” he said. “People don’t believe in the bottom end of the market. … (But) we believe in that space.”

BY JOHN COX Californian staff writer jcox@bakersfield.com

http://www.bakersfieldcalifornian.com/business/real-estate/x568089810/Investors-have-swooped-in-quickly

More demand, less supply pushes Bakersfield home prices up 3 percent

Lower supply and higher demand drove up Bakersfield home prices another 3 percent last month, according to the latest housing report from local appraiser Gary Crabtree.

Active listings of single-family homes in the city declined by almost 12 percent to 432 between February and March, Crabtree reported in his closely watched housing market update. A year before, there were 738 listings in Bakersfield.

“The supply represents the lowest since I began tracking the market in January 1993,” he wrote in a note accompanying the report.
Meanwhile, home sale closings totaled 473 in March — an 11 percent jump from February, according to Crabtree’s preliminary forecast. This measure of market demand was significantly higher in March 2012, when 578 Bakersfield homes were sold.

The city’s median sale price increased in March to $175,000 from $169,945 the month before, Crabtree reported. That was nearly a third (32 percent) more than March 2012’s median price.
Given the acute supply shortage, Crabtree commented that Bakersfield’s home market has reached a “critical point” in its continuing recovery.
Using his own forecasting model, the Bakersfield home appraiser predicted that the city’s median sale price will rise 19 percent over the next 12 months.

BY JOHN COX Californian staff writer jcox@bakersfield.com

California Foreclosure Uptick Doesn’t Indicate Long-term Trend

Foreclosures are declining in most of the Western states tracked by ForeclosureRadar , California, Nevada, Oregon, and Washington—but some experienced anomalous upticks over the month of February.

For example, in California notices of default and notices of trustee sale together increased 10 percent in February, according to the analytics firm. This is quite a change from the previous month’s 43.3 percent decline.

The firm anticipates a return to the recent trend of declining foreclosure activity in the state, which it suggests are driven by the National Mortgage Settlement and the passage of the California Homeowner Bill of Rights . Together these actions have led to increased foreclosure alternatives such as short sales.

While seen as positive for homeowners, ForeclosureRadar points out an unintended consequence of recent market conditions: decreased REO inventory, which is “still very much a part of the California real estate landscape,” the firm said.

“While policy makers state that the purpose of government intervention is to help homeowners by delaying foreclosures, instead they have created an artificial shortage in bank-owned ( REO ) inventory,” ForeclosureRadar stated.

California’s foreclosure timeline increased 6.14 percent in February.

Arizona also experienced an increased foreclosure timeline in February, rising 11.28 percent from the previous month.

However, notices of trustee sale in Arizona declined over the month in February, falling 36.51. Notices were down 65.51 percent year-over-year.

Similarly, notices of trustee sale in Nevada fell both monthly and yearly—by 14.19 percent and 41.68 percent, respectively.

Time to foreclose in Nevada decreased 4.69 percent in February.

Oregon’s notices of trustee sale increased 3.12 percent over the month of February but decreased 94.81 percent year-over-year.

Oregon’s foreclosure timeline decreased 3.03 percent over the month of February.

Washington experienced a decline in notices of trustee sale in February—a decrease of 23.53 percent. However, year-over-year, notices were up 89.12 percent, and the state’s foreclosure timeline increased 3.23 percent over the month of February.

Author: Krista Franks Brock • Date: 03/15/2013

http://m.dsnews.com/?url=http%3A%2F%2Fwww.dsnews.com%2Farticles%2Fcalifornia-foreclosure-uptick-doesnt-indicate-long-term-trend-2013-03-15#2909

There is no housing bubble in Southern California

A construction worker installs a window in a new home in San Mateo, California. Housing starts need to pick up significantly if the supply and demand imbalance in Southern California is to be corrected.

There is not housing bubble. But of course you could be excused for thinking that there is, if you live in Southern California. The real estate market here is distorted, with supply and demand out of whack.

The Great Recession meant that we didn’t build any houses for four years. The supply of “distressed” properties — foreclosures — is getting tight, because banks are working through their backlog and because they don’t want to flood the market and crush what is for them a good thing: rising prices.

But rising prices are a mixed blessing. In some parts of Southern California, everyday buyers who need a mortgage are getting priced out by all-cash buyers and investors looking to snap up properties at a reduced price, relative to what they hit during the peak.

This has led some market observers to say that we’re dealing with a housing bubble in the region. But that’s not really the story. There are some micro-bubbles. But if you look at the Case-Shiller home price index, it’s clear that, although prices have trended up steadily in Los Angeles County since the beginning of last year, the region isn’t seeing a price spike on the order of what’s happening in, for example, Phoenix, where prices have surged by double-digits.

“We’re not at a bubble level yet,” said Terry Sandven, Chief Equities Strategist for U.S. Bank Wealth Management.

He added that “housing is a bright spot in the economy,” but he echoed an observation that has now become commonplace when studying the Southern California market: inventory is tight. “It’s at 1990s levels,” he said.

Sandven said the overall outlook for housing is favorable.

The National Association of Realtors has pointed out that the inventory crisis will eventually ease, bringing supply and demand back into balance.

But before that happens, housing starts need to pick up — and they’re currently running well below the 1.5 million-per-year average they’ve achieved over the past four decades. What will close that gap is a more free flow of credit — both to consumers and to homebuilders. But it could take a while for that to develop, given that banks have been much stingier with loans since the financial crisis.

http://www.scpr.org/blogs/economy/2013/02/25/12665/no-housing-bubble-repeat-there-no-housing-bubble/