Realtor thinks prices have hit bottom

As homeowners and homebuyers in Southern California, including those in the local markets, continue to cope with struggling residential sales, Acorn managing editor John Loesing continues his multipart questionandanswer series with local real estate leaders about the future of the market and possible signs that the worst might be behind us.

This week's discussion involves Bob Majorino, CEO and owner of Prudential California Realty. The company's five branch offices include Westlake/North Ranch, Thousand Oaks, Moorpark and Camarillo.

Majorino's business career began with the IBM Corporation working in the field engineering, education and management divisions. He became a professional Realtor in 1978 and owned his own company within two years.

Majorino lives in Camarillo with Sarah, his wife of 36 years, and two children, Kevin and Tina.

Q: Let's begin by distinguishing between residential and commercial real estate. Is the shopping center and industrial market, for example, feeling the same downward pressure that has plagued the residential side?

A: Yes, commerical, industrial and retail real estate have experienced the same ups and downs as the residential business does.

Q: According to DataQuick, the median price of homes sold in Ventura County rose $14,000 in April, to $340,000, the first monthtomonth gain in over a year. And the National Association of Realtors says April home sales were up 3 percent nationwide. Are home prices at the bottom and starting to creep up?

A: I believe we are at the bottom. The question is how long we will remain at the bottom before prices start a gradual climb.

Q: Agents on the street have told me they notice an uptick in activity. Do your figures bear this out?

A: Absolutely. Our year-to-date unit count is up nearly double this time last year. And the listingssold percentage has increased by over 79 percent.

Q: As the corrections continue, are we seeing the local submarkets behave differently than elsewhere in Southern California? When it comes, will the turnaround in our area be quicker or slower?

A: I believe the local submarkets are behaving the same in general as other parts of California, but with a less dramatic swing in value. Some parts of the state are off by 70 percent or more.

Q: The beginning of the real estate recession had its roots in the subprime lending mess. Today, isn't it more about the unemployment picture and the inability of potential homebuyers to leverage their equity?

A: The subprime mess triggered the legislation and changes in banking policies and procedures, which make getting loans today more difficult. Unemployment obviously limits the number of potential buyers dramatically.

Q: Have sellers learned to be realistic with their expectations, or do you see bid and ask prices as still being too far apart?

A: Sellers are divided into the same two categories that exist in all markets—motivated and unrealistic.