A short-sale listing is one in which the owner still owns the property, but owes more money on his mortgage than he will get from selling the property. Short sales require the seller’s bank to agree to the final sale price. If more than one bank holds a mortgage on the property, each bank has to approve the sale.

Short sales are different than foreclosures or bank-owned properties. If the home-owner cannot sell the home through a short sale, the bank initiates foreclosure to try to sell the home directly, often in an auction. If the auction fails to turn up a buyer willing to pay at least what the bank was owed on the home, the home becomes Real Estate Owned (REO), where the owner is the bank. The bank then typically sells the property through a real estate agent.

If you are planning to make an offer on a short-sale listing, you should be ready to wait as long as one year for the banks involved in the process to approve or reject your offer. Many types of short sales are a long-shot. If you make an offer on one, you may want to continue touring and considering other homes in case the short sale does not go through.

Because the chance of success on short-sale offers is extremely low, TheLARealEstateTeam.com does not support short-sales for tours or offers.

According to Inman News;

The California real estate market continued to perform at the extremes in January — the rate of sales for resale single-family homes soared 100.8 percent while the median price sank 40.5 percent compared to the same month last year, according to the California Association of Realtors.

A separate set of data released by the state Realtor group and a data company — which includes median price info for more than 300 cities, counties and city areas throughout the state for all housing types — found that the median price dropped in all but one area in the state from January 2008 to January 2009 and dropped more than 50 percent in 26 cities and city areas. The price remained flat in Los Angeles County’s Woodland Hills.

The California Association of Realtors also reported today that the seasonally adjusted annualized rate of sales for single-family detached resale homes in the state, at 629,940, moved up 14 percent compared to December 2008 while the median single-family price dropped 9.5 percent in one month (to $254,350).

James Liptak, CAR president, noted that the annualized sales rate — a projection of monthly sales over a 12-month period, adjusted to account for typical seasonal fluctuations in sales activity — reached its highest level since October 2005.

“A lot of attention has rightfully been directed toward the high number of distressed properties,” said Leslie Appleton-Young, vice president and chief economist for the statewide Realtor group.
She said that the credit pinch on jumbo loans in the state has also impacted the real estate market.

“Since the start of the credit crisis in 2007, jumbo lending has been severely constrained to the point where markets that rely on jumbo loans experienced a 24 percent year-to-year decline in sales in the month of January,” she stated, in contrast to the state’s nearly 101 percent overall gain in the sales rate.

The sales rate for condos dropped 18.3 percent from December 2008 to January 2009 but rose 58.2 percent year-over-year in January, and the median price of resale condos in California slipped 7.2 percent from December 2008 to January 2009 and fell 41 percent year-over-year in January, CAR reported.

CAR reported that the sharpest sales-rate increase for resale single-family homes was in the High Desert region of the state, up 234.6 percent year-over-year in January, followed by the Monterey County region (213.5 percent) and the Riverside/San Bernardino region (149.4 percent).

On the other side of the spectrum, the sales rate remained level in the Santa Barbara South Coast region, rose 10 percent in the Northern California region and was up 20.3 percent in the Santa Cruz County region in January compared to the same month last year.

The median price between January 2008 and January 2009 dropped most in the Monterey region (-54.6 percent), followed by the Monterey County region (-54.5 percent) and the Palm Springs-Lower Desert region (-52.1 percent), while falling least in the Northern California region (-17.3 percent), the North Santa Barbara County region (-22.7 percent) and the Santa Barbara South Coast region (-24.7 percent)

Other statistics released by CAR and research company DataQuick Information Systems, which covers median home-price changes for all new and resale homes and condos in 331 cities and communities in the state from January 2008 to January 2009, found that prices dropped the most in San Juan Capistrano (-69.6 percent) from January 2008 to January 2009.

Richmond (-67 percent) was next on the list, followed by San Bernardino (-64.2 percent), Adelanto (-61.8 percent), Oakland (-59.7 percent), California City (-58.7 percent), Joshua Tree (-56.7 percent), Bloomington (-55.5 percent), Palmdale (-55 percent), and San Pablo (-54.5 percent).

At the other end of the spectrum, the median price remained flat in Woodland Hills and declined the least in Irvine (-0.2 percent), San Pedro (-1 percent), Claremont (-1.9 percent), Stevenson Ranch (-2.1 percent), Huntington Beach (-2.6 percent), Tujunga (-2.7 percent), Dixon (-3.9 percent), Grass Valley (-4.1 percent), and West Sacramento (-4.8 percent), CAR and DataQuick reported.

A CAR index that tracks the inventory of for-sale homes was 6.7 months in January, down from 16.6 months in January 2008. A supply of six months is considered to indicate a rough equilibrium between a buyer’s market and seller’s market, with supplies greater than six months leaning toward a buyer’s market. It took a median 49.9 days to sell a single-family home in California in January 2009, compared with 70.8 days in January 2008, CAR also reported.

La Jolla, in San Diego County, had the highest median home price ($941,000) in January among cities and city areas tracked, followed by Santa Barbara ($939,250), and Beach Cities in Southwest Los Angeles ($744,000). Kern County’s California City had the lowest median price in January ($66,500), followed by Desert Hot Springs ($89,500), and Adelanto ($93,750).

Home sales increased 84.9 percent in December in California compared with the same period a year ago, while the median price of an existing home fell 41.5 percent, C.A.R. reported yesterday. “Sales continue to be strong, exceeding 500,000 units for the fourth consecutive month, and year-to-date sales are nearly 27 percent above last year,” said C.A.R. President James Liptak. “California home buyers benefited during the last half of 2008 from the high-cost loan limit of $729,750, which fell to $625,500 as of Jan. 1. The restoration of the high cost loan limit to the previous level would not only help a housing market still struggling to turn around, but also make financing more affordable for home buyers.”

Closed escrow sales of existing, single-family detached homes in California totaled 544,580 in December at a seasonally adjusted annualized rate, according to information collected by C.A.R. from more than 90 local REALTOR® associations statewide. Statewide home resale activity increased 84.9 percent from the revised 294,520 sales pace recorded in December 2007. Sales in December 2008 increased 5.9 percent compared with the previous month.

The median price of an existing, single-family detached home in California during December 2008 was $281,100, a 41.5 percent decrease from the revised $480,820 median for December 2007, C.A.R. reported. The December 2008 median price fell 2 percent compared with November’s revised $286,850 median price.