2012 Forecast: Real Data Strategies

About Real Data Strategies, Inc.

• The nation's leading analysts of Multiple Listing Service data:– 17 year history in objective, factual service to leading

(and competing) real estate brands, firms and agents.– Considered the “JD Power” of real estate.– In over 300 US and Canadian MLSs and about 230

major metro markets.– Frequently quoted as objective market experts in local

and national business publications.– Learn more about our methods and read our press at

www.realdatastrategies.com.

About Me• Licensed California Real Estate Broker

since 1988. (No longer a new licensee!)

• Life-long resident of Orange County. One of few born and raised there!

• Failed Algebra A in high school. All about understanding….and not statistics.

• Will probably defer to my wife of 30 years who wants a vacation/retirement home in Laguna Beach. (I prefer Rancho Mirage.)

Your Competitive Landscape

Percent of Licenses ActiveDesert Area MLS

October 1, 2008 through September 30, 2009

Active / 2,346 74%

Inactive / 826 26%

Based on data supplied by Desert Area MLS and its member Association(s) of REALTORS, who are not responsible for its accuracy.Analysis dates are October 1, 2008 through September 30, 2009. Does not reflect all activity in the marketplace.

Copyright © 2009, Real Data Strategies, Inc. All rights reserved.

An improvement from only 69% at same time last year, AND an increase from 2,288 active agents!

An active agent closed one or more sellers or buyers during the analysis period. Some inactive agents are members of teams, which the MLS cannot identify.

Total Closed Volume by Active AgentsIn Desert Area MLS


1.0% 5.0%10.0%

25.0%

12.6%

33.8%

48.7%

71.5%

89.2%

50.0%

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

Percent of Active Agents Percent of Closed Volume

The famed “80/20 Rule” does not apply among active agents. Note that the bottom 50% of active agents (not shown) closed only about 11% of total closed volume.



Total Closed Volume by Active AgentsIn Desert Area MLS


$22.3$11.7

$7.5$5.4

$3.6$2.6

$2.1$1.3

$0.6$0.2$0.0

$0.00 $5.00 $10.00 $15.00 $20.00 $25.00

Top 24 ( 1% ) of Active / $245K ASP

Next 47 ( 2% ) of Active / $280K ASP









Next 826 Agents

These production results do not include buyers represented in agent-level double-end transactions, which are not verifiable. Some agents representing buyers in co-op transactions are also not properly identified in the MLS.



Marketplace Talking Points

for Success

With Sellers• Almost all increased sales activity is due to

seriously eroded values and equity. Sold properties are leading prices down.

• Lead the market, or get out of the way. I will not take a listing from a seller whose home is not priced to sell in this market.

• Huge opportunity for move-up buyers, as higher-priced property values have not yet firmed. Sell at a 5 percent hit…buy at 10 to 15 percent off.

With Sellers (Continued)

• For local, working buyers, there are few sales without mortgages, no mortgages without appraisals, and no appraisals without supporting comps. Institutional sellers are creating appraisal comps.

• Cash buyers have cash because they are savvy. They will determine value, and will want their money to go far because of their ability to pay cash. Seller realism is the key to making offers come together.

With Buyers• First-time buyers are competing for

VERY tight inventory no matter what they may read about the overall market.

• REO / Short Sale opportunities abound, but banks are slow to respond (if at all.)

• Buyers have two options:1. GET a great deal, or

2. CLOSE a very good deal.

With Buyers (Continued)

• Many non-institutional sellers know banks are their competition, are willing to be realistic about values, and will be motivated to receive your offer.

• Time is ALWAYS money:– Spend a lot of time on a bank deal.– Spend less time and headache on a non-bank deal.

• Low and mid-price buyers will regret missing this window of low prices and record low mortgage rates.

Local Market Trends

9-Quarter Sales & Price History

• Use these to compare recent market activity to that of the past.– Increased sales activity has been almost exclusively

due to falling sale prices and seller equity.– Effectively ground sellers in pricing reality.– Provide better counsel to buyers in this competitive

market.

• Why use 9 quarters on these graphs?– Real estate is a seasonal business. 9 quarters allows

comparison of the most recent quarter to the two previous seasonal calendar quarters.

9 Quarter Trend of Home Sales& Average Sale Prices

In Bermuda Dunes / 92203July 1, 2007 through September 30, 2009

$434 $460 $452 $390 $324 $279 $246 $252 $270

24

10

17

25

20

13

21 22

31

$0

$125

$250

$375

$500

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

8

16

24

32

Avg. Sale Price Listing Units Sold

Based on data supplied by Desert Area MLS and its member Association(s) of REALTORS®, who are not responsible for its accuracy.Analysis dates are July 1, 2007 through September 30, 2009. Does not reflect all activity in the marketplace.


1-year sales trend: Up 55%.


1-year price trend: Down 17%.



In Cathedral City / 92234July 1, 2007 through September 30, 2009

$323 $329 $299 $262 $225 $203 $181 $170 $167

202223

211

257 250

170

115113

87

$0

$100

$200

$300

$400

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

75

150

225

300









In Coachella / 92236July 1, 2007 through September 30, 2009

$292 $269 $215 $207 $187 $168 $128 $139 $141

113

142

178

131

20 2030

67

95

$0

$75

$150

$225

$300

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

50

100

150

200









In Desert Hot Springs / 92240July 1, 2007 through September 30, 2009

$255 $218 $193 $158 $135 $108 $85 $87 $96

227

271285

344

251

78 70 79

124

$0

$75

$150

$225

$300

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

100

200

300

400









In Desert Hot Springs / 92241July 1, 2007 through September 30, 2009

$241 $302 $229 $247 $185 $117 $140 $107 $100

97 7

10

1315 12

28

21

$0

$80

$160

$240

$320

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

8

16

24

32









In Indian Wells / 92210July 1, 2007 through September 30, 2009

$1,220 $1,165 $915 $1,332 $1,199 $958 $777 $579 $731

41

29

31

59

25

26 25

54

43

$0

$375

$750

$1,125

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

15

30

45

60









In Indio / 92201July 1, 2007 through September 30, 2009

$432 $304 $322 $269 $212 $184 $163 $162 $154

70 77

103

190 233246 240

270

229

$0

$110

$220

$330

$440

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

70

140

210

280




1-year sales trend: Down 2%.





In Indio / 92203July 1, 2007 through September 30, 2009

$399 $322 $355 $296 $261 $243 $226 $225 $212

34 32

54

106 121

146134 168

143

$0

$110

$220

$330

$440

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

45

90

135

180









In La Quinta / 92253July 1, 2007 through September 30, 2009

$647 $834 $760 $672 $504 $481 $476 $539 $436

193172

238339

264

219233

299 300

$0

$225

$450

$675

$900

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

90

180

270

360









In Palm Desert / 92211July 1, 2007 through September 30, 2009

$508 $438 $486 $445 $401 $349 $335 $319 $313

143

118

179

224

147 104109

219

166

$0

$130

$260

$390

$520

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

60

120

180

240









In Palm Desert / 92260July 1, 2007 through September 30, 2009

$620 $596 $685 $673 $533 $373 $495 $416 $373

94 91

126

154

120

90

75

159136

$0

$175

$350

$525

$700

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

45

90

135

180









In Palm Springs / 92262July 1, 2007 through September 30, 2009

$493 $434 $415 $379 $362 $324 $309 $272 $269

174163

117

192 187152

143

219226

$0

$130

$260

$390

$520

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

60

120

180

240









In Palm Springs / 92264July 1, 2007 through September 30, 2009

$439 $431 $431 $405 $387 $360 $350 $291 $327

139127 131

177

129

102

85

169 150

$0

$110

$220

$330

$440

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

45

90

135

180









In Rancho Mirage / 92270July 1, 2007 through September 30, 2009

$853 $830 $780 $743 $565 $594 $645 $585 $614

133123

151

186

12298

90 137 126

$0

$225

$450

$675

$900

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

50

100

150

200






1-year price trend: Up 9%.



In Salton City / 92275July 1, 2007 through September 30, 2009

$213 $166 $145 $120 $111 $68 $66 $53 $59

30

18

34

1914

19

26

112

47

$0

$55

$110

$165

$220

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

30

60

90

120









In Thermal / 92274July 1, 2007 through September 30, 2009

$252 $553 $190 $128 $112 $86 $68 $68 $703 4 2

6

22

44

63

36 34

$0

$140

$280

$420

$560

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

16

32

48

64





2-year sales trend: Up 1,033%.




In Thousand Palms / 92276July 1, 2007 through September 30, 2009

$184

$223$232

$221

$182

$149

$129$114

$134

3

9

14 1411

23

32

41

22

$0

$60

$120

$180

$240

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

11

22

33

44









In Twentynine Palms / 92277July 1, 2007 through September 30, 2009

$143 $153 $100 $160 $99 $131 $103 $84 $89

18

10

27

15

21

1615

20

23

$0

$40

$80

$120

$160

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

7

14

21

28









In Yucca Valley / 92284July 1, 2007 through September 30, 2009

$252 $229 $221 $186 $179 $149 $134 $110 $142

39 40

25

46

55

47

54

63

53

$0

$65

$130

$195

$260

2007 / 3 2007 / 4 2008 / 1 2008 / 2 2008 / 3 2008 / 4 2009 / 1 2009 / 2 2009 / 3

Th

ou

sa

nd

s

0

16

32

48

64








Inventory in Months’ Supply


• Use these graphs with sellers to:– Communicate how overpricing will result in longer

market time and likely price reductions.

– Understand the market time benefit of pricing at -- or slightly below -- market value.

– To counter unreasonably low offer prices in a tight inventory market segment.

– To support reasonably lower offer prices in relation to realistic list prices received by your seller in a high inventory market segment.


• Use these graphs with buyers to:– Target property type, geographical and list

price market segments which have an oversupply of available inventory, and which also may have more highly motivated sellers.

– Establish realistic expectations about offer prices relative to supply-and-demand within the prospect’s purchase market segment.

– Support reasonable low offer prices relative to a seller’s list price, considering competing inventory and a seller’s likely time on market.


• Every property is unique and has its own unique value to possible buyers. Use of this aggregated data to measure inventory assumes:– No new listings will come to market before the

supply is absorbed.

– Buyer activity levels of the preceding 12 months will remain constant before the supply is absorbed.

– All homes are equal in their appeal.

Inventory in Months’ SupplyCathedral City / 92234

Using Inventory Available on October 5, 2009,And Pending & Sales Activity for Previous 12 Months

36.0

7.3

12.0

1.8

6.1

2.2

1.8

1.2

60.0

14.7

7.3

0 10 20 30 40 50 60 70

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached

0.0 SFR Supply - No Listings & 2 Sales

Infinite Attached Supply - 1 Listing & No Sales

Insufficient Attached Data - No Listings & No Sales



Based on data supplied by Desert Area MLS and its member Association(s) of REALTORS®, who are not responsible for its accuracy.Values are estimated months to absorb all available inventory, assuming no additional listings, and that annualized sales activity remains constant.


Values are the number of months to exhaust all supply on the study date, assuming no new inventory, a sales pace consistent with that of the last 12 months, and all homes are equal in their appeal.

Inventory in Months’ SupplyCoachella / 92236


1.3

12.0

2.3

1.44.8

0.0 3.5 7.0 10.5 14.0

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached

Infinite SFR Supply - 1 Listing & No Sales

Insufficient Detached Data - No Listings & No Sales



0.0 Attached Supply - No Listings & 5 Sales

0.0 Attached Supply - No Listings & 1 Sale









Inventory in Months’ SupplyDesert Hot Springs / 92240


1.0

28.0

7.4

2.5

4.5

9.0

0 5 10 15 20 25 30

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached

Infinite SFR Supply - 3 Listings & No Sales




Infinite Attached Supply - 2 Listings & No Sales









Inventory in Months’ SupplyDesert Hot Springs / 92241


1.5

14.0

1.712.0

0 2 4 6 8 10 12 14 16

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached
















Inventory in Months’ SupplyIndian Wells / 92210


48.0

14.0

9.2

12.8

4.0

13.2

5.1

9.0

168.0

36.0

66.0

15.7

21.3

13.6

3.8

0 50 100 150 200

Under $300K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K - $799K

$800K - $899K

$900K & Over

DetachedAttached





Inventory in Months’ SupplyIndio / 92201


84.0

6.9

10.0

8.0

0.8

8.2

3.8

1.5

3.0

13.7

2.6

0 20 40 60 80 100

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached









Inventory in Months’ SupplyIndio / 92203


12.0

18.0

22.0

12.0

8.2

2.3

2.0

2.4

1.5

0 5 10 15 20 25

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached

Insufficient Detached Data - No Listings & No SalesInsufficient Attached Data - No Listings & No Sales









Inventory in Months’ SupplyLa Quinta / 92253


34.5

22.0

19.7

12.1

2.4

12.3

6.8

4.7

12.0

24.0

6.4

18.0

21.2

9.6

0 5 10 15 20 25 30 35 40

Under $249K

$250K - $349K

$350K - $499K

$500K - $749K

$750K - $999K

$1000K - $1499K

$1500K - $1999K

$2000K and Over

DetachedAttached






Inventory in Months’ SupplyPalm Desert / 92211


38.8

15.0

50.4

18.0

6.0

11.6

9.7

6.8

6.0

24.0

7.5

17.5

16.6

17.2

0 10 20 30 40 50 60

Under $300K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K - $799K

$800K - $899K

$900K & Over

DetachedAttached






Inventory in Months’ SupplyPalm Desert / 92260


32.0

30.0

11.1

12.7

3.5

11.3

9.7

6.6

12.0

24.0

9.6

24.0

19.1

12.6

0 5 10 15 20 25 30 35

Under $300K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K - $799K

$800K - $899K

$900K & Over

DetachedAttached






Inventory in Months’ SupplyPalm Springs / 92262


15.4

7.6

8.0

6.3

1.6

4.8

3.1

1.5

48.0

6.0

4.4

5.0

8.0

7.7

7.0

0 10 20 30 40 50 60

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached





Inventory in Months’ SupplyPalm Springs / 92264


16.2

11.5

11.5

5.8

5.3

2.8

6.0

84.0

17.5

5.3

15.7

7.9

5.7

0 20 40 60 80 100

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached

0.0 SFR Supply - No Listings & 9 Sales






Inventory in Months’ SupplyRancho Mirage / 92270


42.8

22.3

21.1

17.9

6.0

11.3

6.1

6.7

48.0

33.6

9.5

22.4

16.2

15.3

0 10 20 30 40 50 60

Under $249K

$250K - $349K

$350K - $499K

$500K - $749K

$750K - $999K

$1000K - $1499K

$1500K - $1999K

$2000K and Over

DetachedAttached






Inventory in Months’ SupplyThousand Palms / 92276


1.8

8.0

21.0

2.46.0

0 5 10 15 20 25

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached















Inventory in Months’ SupplyTwentynine Palms / 92277


8.2

32.0

3.8

0 5 10 15 20 25 30 35

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached

















Inventory in Months’ SupplyYucca Valley / 92284


24.0

3.4

10.8

17.2

3.4

0 5 10 15 20 25 30

Under $100K

$100K - $199K

$200K - $299K

$300K - $399K

$400K - $499K

$500K - $599K

$600K - $699K

$700K and Over

DetachedAttached















Patrick Veling, President480 Apollo Street, Suite A

Brea, CA [email protected]

2012 Forecast: Real Data Strategies

Real Estate

Transcript of 2012 Forecast: Real Data Strategies