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I want to present a predictable experience for you, dear reader.  Every Monday will be Business Monday with all the stats and dry business news I can stomach.

Here’s the graph for Northwest activity:

As you can see, not much is going on, but an absence of movement is just as instructive as dramatic movement.  We have 2 less homes on the market, but not many homes have sold.  This means that some home sellers are getting discouraged and taking their homes off the market.  This idea is further supported by the small number of price reductions.

Seasonally, this is pretty normal.  As fall approaches people naturally turn toward their current home, not away to a new home.  If there are no compelling reasons to sell, (death, birth, job, marriage, divorce) then this is the time of year to regroup and decide if change is necessary.  This also means that there is still strength in our local economy.  If there were underlying weakness, than I think we would see an abnormal trend toward an increasing inventory.

However, 2 weeks of stats is less than reliable!  I am possibly (but hopefully not) overly optimistic that we in Northwest Glendale will fare better than the rest of the LA area.

In a meeting last week, I heard a top mortgage broker say that 20-25% of the buyers can’t qualify for loans under the new mortgage environment.  Because jumbo rates have risen a full percent, the buyers that are left had their buying power decrease by 15%.  To put it another way, out of 10 buyers who last year could buy a $1,000,000 house, only 7.5 can buy anything at all and all 7 or 8 of the buyers left can only afford to buy an $850,000 house.

Folks, this is huge.  A large segment of our market is financed with jumbo loans.  If you need to sell right now, for life reasons, you must recognize that the rules of the game have changed.  Sell with the big picture in mind and know, that with few exceptions, you can reap the rewards of this market on the buying end.