Back to Regular Shadow Inventory

Here is a very good article from Voice of San Diego about what might actually be happening with the local real estate market:

Frequent readers know I've spilled a lot of virtual ink on the concept of "shadow inventory" -- the fairly vast category of homes that are in foreclosure but not for sale. This overhang of potential but not-yet-actual inventory contrasts with the very low levels of inventory currently for sale.

The title of this post refers to a recent entry describing how current inventory is even lower than it seems. That prior article contained a graph showing that the amount of current inventory is unusually low compared to the number of sales, even before taking account of the reverse-shadow inventory effect.

But while sales are numerous in comparison to available inventory, homes in foreclosure are quite numerous in comparison to sales. The following chart, which measures the number of single family home sales divided by the number of monthly default notices (the first official stage of foreclosure), makes this clear:

See the entire story with neat graphs at: http://www.voiceofsandiego.org/

Water Conservation Measures

At a Boy Scout campout the other night, I was chatting with my friend Tom who is 'in the know' about what goes on in the County and most municipalities. He is always one to cut right to the quick and let me know what's happening in a way my friends and clients would appreciate. On this night, I asked what he thought the San Diego area would look like in five years of water rationing.

To the point, he said 'There'll be a lot less grass!" and we continued down that vein. It turns out, I discovered that the County has a very rigorous conservation program that includes heavy fines for violators and the use of wireless 'point to source' water meters that report the amount of water usage. If someone violates the watering restrictions, the water companies and districts can literally shut down the water.

This is reminiscent of growing up in Denver under water restrictions. Further, neighbors and visitors will be encouraged (does that mean 'bribed' with incentives?) to turn in law breakers. And, there will be water cops on patrol.

Water restrictions are a long time in coming to the area, and I believe these will serve us well if properly introduced and enforced. The local populace will come to have a better appreciation of our precarious position in a desert, and there will be plenty of water for us in the end. My purpose here is to let you know that messing with the 'Water Man' is no joke, live and act responsibly.