[quote author="usctrojanman29" date=1232003597][quote author="ipoplaya" date=1232002481][quote author="freedomCM" date=1232002132]NOTs to follow, and REOs by the spring!</blockquote>
There are a crapload of Irvine places scheduled for auction between now and the end of Feb. Something like 30-40...</blockquote>
See IPO and you thought that prices wouldn't head lower in Irvine. Once these REOs hit the market in the Spring, Irvine prices will take a step down.</blockquote>
Not necessarily. I think it more depends on the volume of discretionary sellers that elect to enter the market. In Irvine, prices didn't fall much during 2008 because inventory was relatively low as compared to 2007. Many discretionary sellers didn't elect to sell and compete with the REOs working through the system. Couple that with lowering mortgage rates and the sales that did occur were able to roughly sustain a flatish market for the last 8-9 months of the year.
There are 30% less homes on the market to start 2009 than there were to start 2008. That means all the REOs, and then some, from 2008 got absorbed by buyers. With an average of 114 sales in Irvine for November/December '08, there is perhaps six months of inventory on the market to begin the year, probably closer to five. As there is a significant glut at the high end, I think we may have only 4-5 months of inventory sitting right now. This would be a fairly "normal" figure for any locale so those REOs coming this spring will need to significantly outpace normal spring sales growth to produce a large drag on prices.
