Real estate experts say local 'mini-bubble is over'

Real estate experts say local 'mini-bubble is over'
BAKERSFIELD, Calif. (KBAK/KBFX) — The real estate market in Bakersfield is "in recovery" and trending toward "stabilizing prices." That's the view of long-time analyst Gary Crabtree. He said the market is changing from a sellers' advantage to a buyers' advantage, though others see opportunities for both.

"You might say the mini-bubble is over," Crabtree told Eyewitness News on Monday. "We should see some transition back into a normal market."

From Affiliated Appraisers, he's been tracking the local market since 1993.

The last few years have been anything but normal, starting with the real estate bubble and then the effects of the bust of 2006-07.

Now, Crabtree said he sees prices coming down and starting to level off.

He said August saw a peak, with the median home price at $199,400. As of October, was $185,000.

Crabtree said that's a drop of 7.2 percent, but the October median price is still 19.4 percent higher than a year before.

He admitted prices do dip in winter, but he sees a trend.

"We're seeing a little more decline in prices this winter than we have in the last two winters," Crabtree explained.

Also, the number of homes on the market is up. On Monday, he saw 1,001 homes for sale, saying that's about 70 percent more than a year before.

More houses for sale and lowering prices make things better for buyers, he said.

But, Realtor Scott Tobias also sees good news for sellers.

"Right now, it's a window of opportunity," Tobias said.

For buyers, the interest rates are good.

"They're still low," Tobias said. "And, I believe they'll go higher by the end of the year."

He said there are "great" opportunities for buyers to get loans while prices are still reasonable, and thinks buyers with good credit should be able to buy.

Tobias said for sellers, prices are better than a year ago, and many owners now have more equity in their homes.

Both Tobias and Crabtree said investors are no longer in the market, snapping up homes in foreclosure to rent out.

"Investors pulled out of the market three months ago," Crabtree said.

But, those people who lost homes to foreclosure or short sales are now more likely to be back in the market as buyers.

"Now we have cleared that three-year barrier that the government set, and now they can buy again," Crabtree said. He called these the "boomerang buyers."

"Now they'll be able to leave the rental market," Crabtree said.

While that means more buyers, Crabtree said another trend spells fewer homes for sale. He said residential construction appears to be declining, because the number of building permits is down.

"(The builders) were averaging a little over 100 permits a month for 2013," Crabtree said. "In September, they only pulled 57."

But, the buyers also face challenges because of the current economy.

"It's still rather weak," Crabtree said. "Unemployment is rather high, we don't have meaningful job creation."

Winter is the "off peak" period for real estate, but Crabtree said there are some special changes in the latest local data.

"It leads me to believe that going forward into the year 2014, it is not going to be anything like what we've experienced in 2013 and the latter part of 2012," he said.