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Triangle (July 2009)
17,714 homes for sale, 2,337 closed sales = 7.57 months of inventory
Median Sales Price YOY -4.6%, Average Sales Price YOY +3.3%
Wake County (July 2009)
8,632 homes for sale, 1,274 closed sales = 6.77 months of inventory
Median Sales Price YOY -5.9%, Average Sales Price YOY +2.6%
Isn't 6-7 months of inventory considered a "normal" housing market?
Hmmm.... 3948 new listings for the Triangle in July; 2337 closed sales, with an existing inventory of 17,714 houses. Seems to me like the bathtub is pretty full, and the water is coming in faster than the drain is letting it out. I'm not sure that dividing inventory by the month's closings is a very accurate way to convey the amount of time it will take to work through the inventory backlog. That only works if no new listings come into the system.
Hmmm.... 3948 new listings for the Triangle in July; 2337 closed sales, with an existing inventory of 17,714 houses. Seems to me like the bathtub is pretty full, and the water is coming in faster than the drain is letting it out. I'm not sure that dividing inventory by the month's closings is a very accurate way to convey the amount of time it will take to work through the inventory backlog. That only works if no new listings come into the system.
"Closed" is a SOLD home. A definitive status.
"New Listings" is an indeterminate status. Many homes are re-listed, listed with another agent, or just relisted after expiring.
They may show as New Listings, but actually are not. Opinions differ as to how that impacts numbers, whether the impact is material or not.
Regardless, it is a little indeterminate.
And the 17,000+ is across 17 counties, and some of southern VA. The local market is segmented by price and location.
To massage the numbers and come up with any MLS-wide practical conclusions would yield a large margin of error.
But... Consider a great properly priced $225,000 home in Cary, Raleigh, Morrisville, Apex, or Holly Springs, and agents will claw each other for the listing. It will sell fast because of price and condition.
I'm not a real estate expert and I'm usually a pessimist, but is it just me or do these numbers look pretty good in terms of inventory and prices?
Ignoring the fact that the data isn't that useful because they keep changing how they report it (look at the numbers for sale from this month's and last month's report - several thousand just disappeared), there is a bit of good news in the numbers. Sales are now back up to 2002 levels after being below that level for the last 3 quarters. They went up a bit more than normal from June to July this year - whether that's a trend or we're just pulling buyers from the future who are taking advantage of government's offer to pay for them to buy a $250K house with net $0 down is something that remains to be seen.
Inventory is starting to go down a bit and is about at 2007 levels again, with some areas way better than others. Durham, for example, is below 2006-2008 levels by a significant amount.
Don't get too caught up in the exact level of price drops - those numbers jump around quite a bit depending on what houses happen to sell each month. The trend for the overall area is 5-10% below last year. Wake County price drops seem to be getting larger, Durham is seeing a bit of stabilization over the summer, but overall the trend is down with the year over year price drops growing larger as time goes on.
It looks lik the market's moved out of the "I'm not going to give my house away" phase where nothing sells because buyers and sellers are too far apart on price. It's now progressing towards the point where sellers who need to sell are getting what they can for the house while sellers who don't are getting out of the market. That's normally the point where price drops start in earnest ... we'll see if the trend holds for us like it has everywhere else.
Quote:
Isn't 6-7 months of inventory considered a "normal" housing market?
More or less, but you're looking at sales during the peak of the selling season. In the past, we've dropped to 2-4 months of inventory during the summer as sales hit their peak for the year. Last year at this time there were also 6-7 months of inventory, and the last 12 months have hardly been a great time to sell a house around here. Expect to see this number go up quite a bit as the things slow down into the fall.
Isn't measuring the health of the real estate industry by counting the number of houses listed about as reliable as measuring unemployment by counting the number of people seeking work (rather than those out of work)? A very low level of listing activity (relative to past years) could distort the inventory number.
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