Housing information for Southwest Riverside County

1. Housing? Bah, Humbug!
As forecast, regional yearend housing numbers are not at all jolly, they’re downright Bah,
Humbug! After falling 10% in October, sales dropped another 19% in November. In the past six
months, sales have fallen 40% (1,156 / 700) although we’re still 7% ahead of 2014 YTD sales (9,174
/ 9,915). Historically this is not an unusual yearend trajectory but this year the drop seems
somewhat more precipitous than in recent years. Pending sales do indicate that we will see a little
spike up in December, likely followed by a dismal January before things start picking up again.
We hope.
Signals are mixed heading into year-end with the economy showing some gains, some losses and
very slow progress. Even the economists we spoke with at our recent national meetings were only
mildly optimistic about 2016, iffy on 2017 and noncommittal for 2018. A recent series of headlines
illustrates the schizoid nature of trying to forecast with any accuracy. Trumpeting the 211,000
jobs added in November, headline #1 read ‘Strong jobs report shows economic strength’. That
was Page 1. Page 2 headline reads ‘Layoff numbers on track for worst year since 2009’. That was
followed by an article proclaiming ‘More uplifting signs for the economy’, followed by an article
discussing the ‘Lowest labor force participation in 38 years’.
The dollar is stronger. That’s good. But that makes US goods more expensive overseas impacting
exports and manufacturing jobs. That’s bad. Oil prices remain low. That’s good. But that has lead
to massive layoffs in the mining/oil sector causing fiscal problems for some cities and states.
That’s bad. Retail hiring is up for the holidays. That’s good. That’s part-time, lower wage jobs that
will end in January. That’s bad. Surprisingly one sector leading the rebound in November was
construction – tied to more housing construction. That’s very good – unusual for a cold-weather
month, but good. It’ll be even better if we can keep it rolling into the new year. We desperately
need new housing stock.
Of course all that good news is providing the basis for the Fed to start lifting interest rates later
this month. At this point it’s not so much a matter of when they’re going to do it, but how often and
by how much. Analysts expect a series of increases over the next 18-24 months raising rates back
up to around 6% again. If you haven't refi-d yet, you'd best act now as these 3-4% rates will soon
be just a pleasant memory.
A bright spot in our local market is the continuing strength in median home values. While prices
dipped 3% from October to November, they did retain an 8% bump over last November and remain
5% above last year-to-date ($299,652 / $315,055). That’s good news if you’re a homeowner. Of
course rising prices make it more difficult for first-time buyers, younger folks and service workers
who have seen their wages stagnate to enter the market. Higher prices, lack of inventory and
restrictive lending continue to impact the market keeping homeownership rates at a 50 year low,
especially among that critical segment of under-35 buyers.
As another year of Realtor® Report draws to a close, I’d like to wish you all a very Merry
Christmas, or Happy Hanukkah, Joyous Kwanzaa, Feliz Navidad, Joyeux Noel, Mele Kalikimaka,
Buon Natale or even Gun Tso Sun Tan'Gung Haw Sun, but I don’t want to leave anybody out or
offend the increasingly sensitive souls that surround us. So I’ll just say Happy Holidays and may
our New Year bring health, prosperity and safety (and a new President would be OK too).

2. SW Market @ A Glance
Southwest
California
Reporting
Period
Current
Period
Last
Period
Year Ago
Change
from
Last
Period
Change
from
Year
Ago
Existing Home
Sales (SFR
Detached)
November
2015
700 859 694 19% 1%
Median Home Price $320,421 $329,069 $304,497 3% 8%
Unsold Inventory
Index (SFR Units)
2,239 2,478 2,496 10% 10%
Unsold Inventory
Index (Months)
3.4 3 4.3 12% 21%
Median Time on
Market (Days)
77 72 79 5% 9%
Source: CRMLS

3. 0
50
100
150
200
250
3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15
Temecula Murrieta Lake Elsinore Wildomar
0
50
100
150
200
250
3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15
Menifee Canyon Lake Hemet San Jacinto Perris
Southwest California Homes – I15 Corridor
SFR Sales
Southwest California Homes – I15 Corridor
SFR Sales

4. $0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15
Temecula Murrieta Lake Elsinore Wildomar
$0
$100,000
$200,000
$300,000
$400,000
$500,000
$600,000
3/13 6/13 9/13 12/13 3/14 6/14 9/14 12/14 3/15 6/15 9/15
Menifee Canyon Lake Hemet San Jacinto Perris
Southwest California Homes – I215 Corridor
Median Price
Southwest California Homes – I15 Corridor
Median Price

5. 0
50
100
150
200
250
300
350
400
450
On Market
(Supply)
Pending Closed (Demand) Days on Market Months Supply Absorption rate *
3
8
0
1
5
2
1
3
2
7
4
2
.
9
1
1
1
%
4
0
0
1
4
1
1
0
8
6
9
3
.
7
9
2
4
1
6
1
8
9
1
1
9
5
8 3
.
5
9
1
%
3
0
7
1
9
8
1
3
4
6
2
2
.
3
1
1
5
%
2
5
0
1
0
4
6
3
9
1
4
.
0
7
8
%
1
6
5
9
3 6
3
7
7
2
.
6
1
0
0
%
1
6
7
7
7
4
0
8
3
4
.
2
7
4
%
9
0
1
6
2
3
1
0
1
3
.
9
1
3
5
%
6
4 3
4
1
8
7
5
3
.
6
8
6
%
Murrieta Temecula Hemet Menifee Lake Elsininore Perris San Jacinto Canyon Lake Wildomar
* Absorption rate - # of new listings for the month/# of sold listings for the month
November Demand
On Market 10%
Pending Sales 7%
Closed 19%
Days on Market 5%
Months Inventory (3.0 – 3.4) 12%
Absorption 6%
Month over Month
With five sales over $1 million (one at $2.7), Murrieta’s median price posted a 7% gain over
October ($397,156/$425,398). With no million+ sales in November, Temecula dropped 10%
($482,326/$435,743). That doesn’t mean that every house in Murrieta gained 7% in value or
that Temecula homes lost 10% overnight. Every home, every neighborhood and every city
has its unique demographic which can only be determined by a trained professional.
While the inclusion of these heavy-hitters does skew the median somewhat, million dollar
homes have always been part of the equation. The numbers illustrated in this report are the
raw numbers for the market and, as such, remain consistent over time. Weighted averages
and seasonally adjusted numbers might be fun but once you start injecting subjective values
into the equation, the numbers become suspect – like many of the statistics coming from
government sources these days. If they aren’t real numbers, do you trust them?
Inventory and sales dropped in most cities keeping the ratio of months inventory in the mid-3
month range. Most cities also saw an increase in absorption with Murrieta, Menifee, Perris
and Canyon Lake homes selling faster than they were being replaced by new listings.
Distressed properties, as a percentage of our active and sold market, remained virtually
unchanged at 9%. Nationwide the foreclosure rate dropped another 27% in October. There
have now been 48 consecutive months of year-over-year declines and the number of
delinquent accounts has dropped to its lowest level since 2007.
States utilizing the judicial foreclosure process, like New York and New Jersey, still have a
backlog of foreclosures to work through (shadow inventory) but not here. While there are still
a few homes with long-term delinquency issues, California managed to clear out most of the
problems allowing our market to recover sooner than some others.

6. November Median Price:
2014 2015 %
Temecula $423,310 $435,743 3%
Murrieta $359,306 $425,398 16%
Menifee $272,576 $284,212 4%
Lake Elsinore $274,974 $301,865 9%
Wildomar $320,685 $347,288 8%
Canyon Lake $460,181 $409,865 11%
Hemet $193,621 $193,646 --%
San Jacinto $199,185 $212,577 6%
Perris $236,644 $273,198 14%
October 2015 Transaction Value*:
Temecula $66,078,670 Lake Elsinore $27,288,324
Murrieta $65,530,808 Wildomar $8,233,400
Menifee $42,955,146 Canyon Lake $14,384,850
Hemet $28,277,800 San Jacinto $14,335,099
Perris $16,475,811 Total $293,559,908
* Revenue generated by single family residential transactions for the month.
November 2015 Transaction Value*:
Temecula $47,060,232 Lake Elsinore $19,017,514
Murrieta $56,152,588 Wildomar $6,251,180
Menifee $38,084,387 Canyon Lake $9,426,900
Hemet $23,043,890 San Jacinto $8,503,084
Perris $17,211,459 Total $233,661,234
* Revenue generated by single family residential transactions for the month.

7. 0
500
1000
1500
2000
2500
3000
1/12
2/12
3/12
4/12
5/12
6/12
7/12
8/12
9/12
10/12
11/12
12/12
1/13
2/13
3/13
4/13
5/13
6/13
7/13
8/13
9/13
10/13
11/13
12/13
1/14
2/14
3/14
4/14
5/15
6/14
7/14
8/14
9/14
10/14
11/14
12/14
1/15
2/15
3/15
4/15
5/15
6/15
7/15
8/15
9/15
10/15
11/15
Inventory Sales
November Market Activity
By Sales Type
Standard Sale Bank Owned Short Sale
Active
% of
MKT Sold
% of
MKT Active
% of
MKT Sold
% of
MKT Active
% of
MKT Sold
% of
MKT
Temecula 384 96% 100 93% 3 1% 4 4% 11 3% 2 2%
Murrieta 346 91% 116 88% 7 2% 2 2% 25 7% 12 9%
Wildomar 55 86% 17 94% 3 5% 0 0% 4 6% 1 6%
Lake Elsinore 208 83% 51 81% 8 3% 3 5% 27 11% 7 11%
Menifee 267 87% 120 90% 10 3% 1 1% 21 7% 8 6%
Canyon Lake 81 90% 21 91% 3 3% 2 9% 5 6% 0 0%
Hemet 383 92% 109 92% 15 4% 5 4% 17 4% 4 3%
San Jacinto 139 83% 36 90% 9 5% 1 3% 16 10% 2 5%
Perris 147 89% 54 86% 3 2% 4 6% 13 8% 4 6%
Regional
Average
2010 90% 624 89% 61 3% 22 3% 139 6% 40 6%
Southwest California Homes
Inventory v. Sales

12. Information courtesy of:
Additional reports available at: