May 26, 2022 Breaking News, Latest News, and Videos

Santa Monica Market: REOs, Shorts, and Shadows:

Some people believe that Santa Monica, like many other areas around Los Angeles, has not reached the bottom level of its current market price point. They comment about the bank REO (Real Estate Owned) pressure on prices, short-sale activity, and an assumed large volume of similar financially-distressed owners whose properties will soon need to be sold.

Anecdotally, this has not felt to be the case for many months. We have noted multiple offers in many cases, sales levels being maintained, and inventory not increasing significantly in comparison with the rate of sales. For example, at the current rate of sales of Santa Monica homes, there is less than a seven month level of inventory of homes available, which equates to a market that is fairly balanced between buyers and sellers.

In order to try to ascertain whether the financially-distressed property numbers might have a greater future impact, we have analyzed the past year of local sales, with the following findings.

The REO market has been relatively small in Santa Monica so far this year. Only 8 homes have been listed in the past 12 months in Santa Monica, with two remaining on the market today. Those that sold averaged five percent lower than the prices at which they were listed. There are currently approximately 45 additional homes owned by lenders, which obviously will be put on the market for sale. With approximately 103 homes for sale at present, depending on the rate that these REOs come on market, there could be substantial impact on the overall marketplace.

The remainder of the “shadow inventory” consists of approximately 54 homes which have been scheduled for repossession by banks at public auction. Many of these may eventually become REOs. However, a significant number of these will be successfully sold as negotiated short-sales.

A review of the last 12 months’ local short-sale activity showed that 28 homes were listed and 13 of these have already sold, with six others in solid escrows. Some of the remaining active short-sale listings have accepted contracts which are in initial stages of being negotiated with the lenders.

If all of the Santa Monica homes that are currently bank-owned (or in the process of being such) were to come on the market, it would equal approximately 55 percent of the number of homes currently for sale. This would be similar in magnitude as in the various areas of the country where short sale and REO activity is 50 percent or more of the market, and the shadow inventory is also considerable. So far this year, only about 10 percent of the sales in the Santa Monica have been REOs or short sales. Naturally, only time will tell. However, it would appear that there could be increased financial pressures on our local market due to the REOs or shadow inventory.

Michael Edlen and his Team are experienced distressed property owner specialists, certified by the national Association of Realtors as a short pay and foreclosure resource. They may be reached at 310.230.7373 or Michael@MichaelEdlen.com.

in News
Related Posts

John Adams Middle School Student Selected to Perform at Carnegie Hall

May 24, 2022

May 24, 2022

JAMS Student Grayson Fitzgerald named junior finalist for the 2022 middle school honors performance series at Carnegie Hall By Staff...

SMC Student Film “The War Within” Accepted into 2022 American Pavilion at Cannes

May 24, 2022

May 24, 2022

Three Santa Monica College Films Will Screen at In-Person Festival, including 2021 Best Student Film Winner “Broken Layers” and 2020’s...

Santa Monica City Council Looks to Shorten Meetings

May 24, 2022

May 24, 2022

Council to consider changes at Tuesday meeting By Dolores Quintana Santa Monica lawmakers are considering taking steps to shorten City...

Landmark Theater Official Closes on Pico

May 24, 2022

May 24, 2022

Pico Boulevard location closes Sunday By Sam Catanzaro The Landmark Theater on Pico Boulevard in Westwood has officially closed.  The...

Road Closures Expected During Demolition Of Parking Structure Three: Santa Monica Beat – May 23rd, 2022

May 23, 2022

May 23, 2022

Local news and culture in under 5 minutes.* Free Donuts At Randy’s Donuts For National Doughnut Day* Road Closures Expected...

Los Angeles Metro Sees 15.9 Percent Increase in Median Rent

May 20, 2022

May 20, 2022

Median rent of $2,258, according to recent report By Dolores Quintana The ongoing pandemic has exacerbated the issues of housing...

New Renderings for Frank Gehry Hotel Development in Santa Monica

May 20, 2022

May 20, 2022

Project would include hotel, apartments, retail and a museum By Dolores Quintana Slowly but surely, plans for a  Frank Gehry-designed...

Shared Mobility Plummets in Santa Monica

May 20, 2022

May 20, 2022

Recent report also shows that nearly half of riders make over $100,000 By Sam Catanzaro Shared mobility use in Santa...

Christopher Dishlip Selected as Santa Monica’s New Assistant Director of Public Works

May 20, 2022

May 20, 2022

Public Works Director Rick Valte announced the selection of Christopher Dishlip as Santa Monica’s new Assistant Director of Public Works....

Letter to Editor: Response to Himmelrich’s “We Walk the Talk” Column

May 20, 2022

May 20, 2022

By Beau Marks As a Santa Monica resident, I am dismayed by Sue Himmelrich’s response (“We Walk the Talk,” Santa...

Motional And UberEats Launch Autonomous Deliveries In Santa Monica

May 18, 2022

May 18, 2022

There Are Plans For Expansion Into The Rest Of Los Angeles Motional, a global driverless technology leader, and Uber Technologies...

Winston Pies Opening Third Location In Santa Monica

May 18, 2022

May 18, 2022

The restaurant used to be known as ButterCrust Pies Winston Pies is staying in Santa Monica when opening their third...

Only 10 Vaquita Porpoises Survive, But The Species May Not Be Doomed

May 17, 2022

May 17, 2022

Hope remains for the porpoise species not only survive but thrive with human help. By Stuart Wolpert The vaquita porpoise,...

The American Cinematheque Brings “Bleak Week” To Santa Monica’s Aero Theatre And The Los Feliz Three Theatre

May 17, 2022

May 17, 2022

33 Films From 18 Countries In One Week. By Dolores Quintana Sometimes when things are tough and you’re feeling down,...

Man Who Murdered His Family Members Pleads Guilty To Five Other Killings

May 16, 2022

May 16, 2022

Escobar injured an additional seven other people as well.  By Dolores Quintana A man, Ramon Escobar, has pleaded guilty to...