Market Report For July, 2008
I use a Market Index to track the local real estate market. If the index is above 1.20, we are in a seller's market, between 1.20 and 0.80 we are in a neutral market, where neither buyer nor seller have an advantage. Below 0.80 is a buyer's market, where there are more listings than buyers.
Market Index – Increased for the fifth straight month, now equal to August of 2007 (the last high before the mortgage meltdown). Buyers are taking advantage of the decline in prices and the relatively inexpensive cost of borrowing.
For sellers – The good news for sellers is that homes that a marketed and priced correctly are selling. It is not uncommon for foreclosures to have multiple offers, however it is even more common to see homes that are “regular sales” have multiple offers during the first week on the market. However, playing the “I won’t sell unless I get my price” game is not helping sales.
For buyers – Inventory is increasing in some areas, so when supply goes up, prices go down. That means that there are some really good deals out there, however, not in all areas all the time. Buyers are out in force, and when they can qualify for a loan, many have decided now is the time to buy. Some are waiting for prices to drop further, however how much farther prices can go is anybody’s guess.
New listings – declined from February by 321, also dropped from June, down to 534, lowest in the last five months.
Pending Sales - Up from February, down from June to 313 units. Pending Ratio increased NINE points, a good sign for sales to close in the next month or so.
Listing Inventory – Down from March, down from June to the lowest level in five months.
Sold Listings – Sales are continuing to increase to the highest in five months.
Days On Market – Dropped 11 days to 70.
Average Sales Price – Some areas are seeing a rebound in values, others are declining, based on inventory.
Conclusions – The overall economy is putting financial pressure on families. If the next set of loan re-sets causes more mortgage holders to foreclose we could have more inventory to sell. Rising transportation costs may make moving closer to work a more important decision that many home buyers are taking into account. If you are renting, buying for the long term is probably a wise move, just find the right home. If you are selling, buyers are out in force, looking for good deals. Only the best values are selling though, with about 75% of the inventory sitting on the shelf because buyers think they are overpriced.
Data is from Itech and Tempo MLS and has not been verified, is not guaranteed, and is subject to change.
