THE TALK OF THE TOWN IS LACK OF INVENTORY...IS HOUSING THE COMEBACK KID?

If any of us paid any attention at all to all the various headlines in Augusts' business sections in any newspaper in southern California, then you noticed a couple of items. Firstly, we are grossly below seasonal averages for inventory. In fact, many cities in Orange County are below 2 months. The city with the largest inventory, not surprising with the high end prices, is Newport Beach, with 5 months. Some very skeptical economist are wading into the shallowend of opinion, that housing is making a recovery. Not only is it making a recovery, but in fact it is one of the most solid pillars of the current, albeit weak, economic recovery. July's housing sales volume jumped 25.7% from year over year 2011 to 2012. In fact, according to an article in the Los Angeles Times business section, home prices are highest since 2008 and posted a 2% rise in July. According to research firm Data Quick, the region's median home price hit $306,000, reflecting that 2% rise from June and 8.1% year over year. Supply and demand will once again factor in the region's prices. According to Data Quick President John Walsh, "There's growing evidence prices have crept up in areas where more demand has met a shrinking number of homes for sale." There are many positive factors for housing's comeback besides shrinking inventory. Also fueling the market is financing, overall stable housing affordability, and pent up demand for many people who have sat out the market for years. They are coming back in droves. Don't expect a substantial rise in inventory any time soon. The time for sellers and buyers to act, may just be right now.