by Calculated Risk on 5/21/2009 07:35:00 PM

From Zach Fox at the NC Times: REAL ESTATE: Foreclosures, booming sales make predictions difficult

The case for a bottoming or recovering housing market is strongest along Highway 78 (Escondido, San Marcos, Vista, Oceanside) and Southwest Riverside County, where housing inventory ---- the length of time to sell all active listings ---- has dipped below three months. Six months is considered healthy; three months is screaming hot.
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However, the numbers flip-flop in high-end areas such as Del Mar and Rancho Santa Fe. Inventory has breached a new stratosphere at anywhere from 25 to 50 months to sell all listings.

Click on graph for larger image in new window.

This graphic from Zach shows both the Notice of Default rate (NOD) and months of inventory by zip code (posted with permission).

In general the lower priced areas are seeing more foreclosure activity than the high prices areas, but the months of inventory is lower.

In a dynamic that is reflected in the divergent inventory numbers, buyers are avoiding the higher end and finding the purchase process on the lower end surprisingly frustrating; real estate agents have reported up to 25 offers on a single house.
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[S]ome analysts think those red-hot inventory numbers in Escondido, Oceanside and pretty much all of Southwest Riverside County aren't that telling, because it's hard to determine how many foreclosures are actually up for sale.

Lenders and government agencies have embraced foreclosure moratoriums, delaying the process of actually seizing the property and putting it back on the market. Once those foreclosures are put on the market, the inventory number could shoot up in a hurry.

Just some more data showing the divergent markets.