Real Estate News!

In her article, Get Ready for Real Estate Rebound, Bernice Ross of Inman News continues:

The 10-year real estate cycle
All markets are cyclical. While markets differ dramatically, a 10-year cycle is common in many places. The Southern California market provides an excellent illustration. In 1960, 1970, 1980 and 1990, the real estate market was at its lowest point plagued by excessive inventory, foreclosures and short sales. By 1994, the market had stabilized from the downturn in the early 1990s. As market values were beginning to climb, the Northridge Earthquake hit. Extensive damage throughout the area sent the market into a tailspin. It took another three years for the market to stabilize again. The beginning of the next upswing began in earnest in 1998. The market peaked in 2005 -- seven years into the cycle -- and then began the current downward trend.

Given a 10-year cycle, California should be pulling out of the bottom and be on its way to a more normal market. This appears to be happening, despite the financial meltdown. The California Association of Realtors reported a 63 percent increase in sales in September. Radar Logic reports increases of year-to-year sales (2007 to 2008) ranging from a low of 16.3 percent in San Jose to a high of 74.3 percent in Sacramento. DataQuick reports that September sales were up from a low of 29.4 percent in Ventura County to a high of 106.1 percent in Riverside County as compared to September 2007. Mike Kelly of Keller Williams Sonoma reports that his market has only two months of foreclosure inventory and about four months of short-sale inventory. Foreclosures and short-sale inventory are rapidly being depleted in other areas of the country as well. As this inventory disappears, prices will stabilize and will eventually begin to rise.