by Jodi Summers

Housing is “resuming its traditional role of leading the recovery charge and once again being the bright spot in the economy,” offers Frank Nothaft, Freddie Mac’s vice president and chief economist.

Happy news all around.  More good words come by way of the National Association of Realtors, which reports that the pending home sales index maintained showed an annual gain in September for the 17th month in a row.

If you’re dreaming of having a pending home purchase in Santa Monica or Venice, the market is challenging right now. Inventory is way down at a mere 1.5 months of homes, and multiple offers are driving up prices. Indeed if you compare Oct-2010 vs. Oct-2012, you’ll notice that the number of Under Contract properties is up an impressive 93%. Kind of gives you a warm fuzzy about the economy finally moving forward.

The pending home sales index represents contracts signed but not yet closed. It settled at 99.5 in September. An index score of 100 is equal to the average level of sales contract activity in 2001, a year in which sales were in line with historical norms. Signed contracts typically close one or two months after the sign date.

“The level of pending contracts has remained very steady implying that this recovery is holding its momentum,” observes Lawrence Yun, NAR’s chief economist. He notes that the steady year-over-year increase in the index “is pointing in the right direction.”

Locally, in Santa Monica and Venice homes are selling in an average of 45 days > compared with 85 days in October 2010. The median sold price is up an eye-popping 31%. Asking prices are up 18%.

Fannie Mae economists believe that the third round of quantitative easing (“QE3”) announced by the Fed on Sept. 13 to boost mortgage-backed security (MBS) purchases.  The Federal Reserve is boosting holdings of longer-term mortgage-backed securities and Treasuries by about $85 billion a month through the end of the year, in the hopes of putting downward pressure on longer-term interest rates and supporting mortgage markets and giving the U.S. economy some momentum. Next year they will buy $40 billion a month. This could last through all of 2013 and perhaps into 2014, adding $1 trillion to the Fed’s portfolio.

“This should create a massive demand in MBS, drive up their prices, reduce their yields, narrow the secondary mortgage spreads significantly, and effectively drive primary or retail mortgage rates lower,” Fannie Mae economists note, predicting that rates on 30-year fixed-rate mortgages will average 3.4% next year, down from 3.6% this year.

The recovery could still be sidetracked by slowing economic growth in Europe and China and the so-called “fiscal cliff” – that series of spending cuts and tax increases set to go into effect Jan. 1 unless U.S. lawmakers come up with an alternative plan for tackling deficit spending.

We’re here to help you with your property needs. Please contact Jodi Summers and the SoCal Investment Real Estate Group @ Sotheby’s International Realty – or 310.392.1211, and let us move forward together.


Join the conversation! 4 Comments

  1. Freddie Mac also maintained its projection that new and existing home sales will total 5.5 million for 2014, the same as for 2013. Single-family mortgage originations are expected to drop about 35% in 2014, but that is from a large decline in refinancing. Freddie Mac also sees refinance accounting for about 40% of originations in 2014, down from close to 60% in 2013.

    Lastly, Freddie Mac assumes that the 30-year fixed-rate mortgage rate will gradually rise higher to about 4.6% by the end of 2014, with fixed rates rising gradually during the second half of the year due to Federal Reserve tapering its bond and mortgage-backed security purchasing.

    Read more: Fannie and Freddie Looking for 5% Home Price Growth in 2014 – 24/7 Wall St. h

  2. Home prices and home sales both showed strong annual growth during the third quarter, according to the latest report by the National Association of Realtors.

  3. Happy sellers. Frustrated buyers.

  4. It’s good to be moving forward.

Leave a Reply

About Jodi Summers

Jodi Summers
Sotheby’s International Realty

Jodi Summers Bio

With $100,000,000 in listed inventory, Jodi Summers understands the coastal commercial real estate market. A top producer with Sotheby’s International Realty, Jodi knows finance, rules, regulations, procedures and methods. She is accurate, knowledgeable, timely and aware of how government shapes the cities of Southern California.

Jodi is born in Brooklyn, raised in and around Manhattan – the family business was marketing, Madison Avenue style. Childhood math quiz questions calculated demographic and psychographic percentages or analyzed the allocation of adverting dollars. Word games were for devising slogans.

An honors graduate from the Walter Cronkite School of Journalism at Arizona State University, Jodi moved to California to achieve her goal of living by the beach with a palm tree and a hibiscus bush in her yard.
She thrived as an entrepreneur in the entertainment, media and marketing industries. One of her books, “Marking and Marketing Music,” is in second edition.

“My marketing and communication skills have proven to be a true gift when it comes to promoting real estate,” observes Jodi. “And I am consistently able to get an exceptionally high price per square foot for my sellers.”

Discipline (Jodi holds a Black Belt in Tae Kwon Do), organization, motivation, excellent communication skills and knowing & satisfying the needs of her clients have been her essentials for running a successful business. A passion for investment real estate explains her emphasis in asset-yielding properties.

Her team joined Sotheby’s International Realty for the company’s powerful brand and stellar reputation.
“We offer the broad market knowledge needed to assist clients in formulating a sound acquisition strategy,” Jodi amplifies. “Together, we evaluate various markets, property types and neighborhoods to devise a customized approach that meets each client’s specific objectives.”

Jodi is a member of the Action Apartment Association of Westside income property owners, the Santa Monica Conservancy historic preservation society, the Ocean Park Association, the Friends of Sunset Park community group, the Real Estate Investors Club of L.A., and the Culver City Rock & Mineral Club. Members of her team are fluent in Spanish and Italian.

“Our reputation assures your satisfaction.”


Buyers, Fascinating Information, Market Snapshot, Market Trends, Of Local Importance, Sellers, Statistics, Uncategorized