Nancy and Brad Hochberger have excellent credit, money for a down payment and flexibility in where they want to live.
But the resurgent Southland housing market had them wondering if they would ever buy a house.
On a single weekend in May, the Glendora couple were outbid after offering more than the asking price for two newly listed San Gabriel Valley homes in the $250,000 range. The previous weekend, they had waited two hours too long to make an offer on a week-old listing.
Having lost out on three houses in eight days, Nancy Hochberger is a believer in the recovery that has taken hold in the Southland housing market.
"Our agent warned us that it was turning around," said the 37-year-old beauty shop owner. "He said it's like we're chasing a snowball downhill."
To Westside and Orange County residents, the Hochbergers' story might seem like old news. But for most everyone else, the party is just beginning.
A recovery that was scattered when 1998 began is no longer discriminating.
"It's clearly migrated into all geographic areas and all price categories," said John Karevoll, an analyst for Acxiom/Dataquick, a La Jolla-based real estate information company.
"The entry-level and mid-sized home markets are now partaking in the recovery to the same degree that the high-end and move-up markets were a year ago."
For almost every Southland homeowner, the news is good. Sales of single-family homes, both new and existing, in Southern California totaled 105,447 through May, up 18.9% from 1997. The sales total is the highest for this five-month period since 1990.
The median Southland home price is $181,000, up 9.7%, so far this year. But the pace is accelerating, Karevoll said, adding that the median for May is $186,000, up 10.7% over May 1997.
Foreclosure activity is declining; interest rates remain low; the economy is robust.
Even first-time buyers can smile: With values still as much as 25% below 1991's peak levels, affordability is excellent.
The recovery is also bringing local government more money. Both Los Angeles and Orange counties expect a 2% increase in property tax revenues based on newly owned properties reassessed Jan. 1.
About the only ones fretting are snowball-chasers like the Hochbergers, who are finding that desirable properties are being snapped up as soon as they hit the market, often with multiple offers and bidding wars.
Nowhere is that better illustrated than on the Westside of Los Angeles.
In Santa Monica, a house priced at $535,000 drew 46 offers, with the highest bidder ultimately coming in at more than $200,000 above the list price.
While that represents the extreme, agent Ron Wynn, in the West Los Angeles office of Coldwell Banker-Jon Douglas, said he's sold more properties this year at prices higher than his clients were asking than below.
"In 1989, sellers would get offers within the first few weeks and it was a hot market," Wynn said. "Today, the market is so hot that either you get offers in the first four to six days, or the heat is gone and people assume something's wrong with the house."
80 Agents in Rain
Jordan Alpert, a 44-year-old food broker, was engaged to be married and needed more space, so he listed his 1,100-square-foot Westwood house for sale in February. On the Tuesday scheduled for an agents' open house, it began to pour and Alpert wondered whether he should cancel.
"The power was out it was raining like crazy and there was mud all over the patio," he said. "As it turned out, 80 agents showed up, and within a day we had multiple offers."
A similar frenzy has occurred in Orange and San Diego counties, with the new-home market providing much of the fuel.
When Kevin and Sophie Sanchez bought in the Aliso Viejo development of Vista Point early last year, there was plenty of standing inventory.
"You could come in and pick what you wanted," said Kevin Sanchez, 31, a real estate agent with Re/Max South County.
Since they were planning to start a family, the Sanchezes simultaneously put their name on a priority list for a larger house in a later phase of the development.
By the time that phase opened earlier this year, prices had jumped significantly. Still, the phase sold out the first morning, "and there were a lot of disappointed people," said Kevin Sanchez.
"Values have probably gone up $100,000 in six months," he said.
The demand for new homes is up all over the Southland, with increases in both sales and prices. But the volume of construction is surprisingly low, said Albert Gobar, a consultant to new-home builders.
Permits were pulled to develop about 50,000 new units in Southern California in 1997, compared with an annual average of about 100,000 during the last 40 years and as many as 200,000 during the last recovery, Gobar said.
"There's nowhere near enough product on the market," said Jeffrey Meyers, another consultant to new-home builders. Meyers attributed the low inventory to the length of time it takes for builders to obtain permits for new construction.
Only three weeks' worth of inventory (enough completed homes to satisfy buyer demand for three weeks) was released in the first quarter of this year, according to Meyers. "In most areas, people have to put their name on a list and hope they can get a house in the next phase," he said.
Meanwhile, he noted, builders post higher prices with each phase and consumers have yet to balk.
In the resale market, the story is the same: many buyers chasing few properties.
Observed Long Beach agent Barbara Shoag of Robert Weil Associates: "It's as if a starting whistle blew just after the first of the year and everyone said, 'I have to hurry and buy a house.' "
The San Fernando Valley, beset by high foreclosure activity and lagging prices as recently as last summer, is typical of an area that has turned up dramatically.
April single-family home sales were 28% higher than a year ago, according to the Southland Regional Assn. of Realtors, which represents the San Fernando and Santa Clarita valleys, with much of that strength coming from the entry-level market. The median price was up 13%.
Even the parts of Southern California that have been slowest to recover--the high desert areas of the Antelope and Victor valleys and Moreno Valley--are beginning to show signs of life.
"Those places hit bottom late last year and now appear to be turning up," Karevoll said.
Analysts agree that just as the Southland housing recovery was a couple of years behind the Bay Area's, the region's far-flung commuter markets may be a year or two behind the metropolitan and coastal areas.
"These are communities that experienced rapid development in the late '80s and early '90s [at the peak of the last cycle], with a lot of low-down-payment mortgages," said Nima Nattagh, a market analyst for Experian, which collects and analyzes real estate date.
"As a result, many people are still in negative-equity situations, and the volume of foreclosures remains high." Still, Nattagh asserted, "the recovery will ultimately spread to those areas."
Nattagh isn't alone in noticing that biggest increases in home values are occurring in the highest-priced neighborhoods.
"To a large extent, median values are up because the more expensive houses are the ones that are selling," he said.
Based on Experian's repeat sales index, which is designed to remove the effect of the mix of houses sold on median prices, values in L.A. County as of March remained 24% below where they stood in January 1990.
Even in Orange County, values were 10% lower than at the decade's outset.
Karevoll noted that the high-end market, which is based more on discretionary spending patterns than on the entry-level and move-up markets, typically fluctuates the most during economic upswings and downturns.
"If you take that into account, all of the markets are about on par with each other," he said.
In fact, the California Assn. of Realtors reports a sharp increase in the proportion of move-up buyers. Homeowners who waited longer than they had originally planned to trade up for a larger house are joining the fray.
As the Hochbergers discovered, it's getting crowded.
But the Glendora couple finally succeeded in their house hunt: They got the fourth house they bid on, and their house sold in eight days.