It’s still a mystery, really. The inventory of homes for sale continues to drop. The amount of new listings that popped up on the market has been the lowest since July 2001. Amazingly, demand is also still dropping! In July we had the fewest amount of sales since July of 2008. It is certainly a unique situation, though I can’t say it’s bad.
According to The Cromford Report, “this is quite unusual and shows us how extreme the shortage of new listings has become. New listings have been arriving at a rate which is lower than in any August we have seen since 2001. In the last four weeks we saw 15.6% fewer new listings than last year and 13.2% fewer than in August 2012, the previous low record holder.”
The short of it is that we are now on the cusp of a balanced market here in the valley. As some of our clients can tell you, the summer has not been an easy one for sellers. inventory of homes (supply) was high and demand was low. Many of the listings on the market have either expired or been cancelled. Because of this summer’s buyer’s market, most sellers are now too timid to put their homes up for sale, which is the main factor driving the low inventory.
Ironically, this has actually created a much more balanced market, one that is more favorable to sellers than it was even a few months ago. We are no longer in a buyer’s market, we are at the threshold of balance. But how long will the decrease in inventory last? Well, that’s any ones guess.
The vast consumer mindset always seems to be 3 to 6 months behind what is actually happening in Real Estate. Most people believe we are still in the buyer’s market and have no idea it’s actually a much better time to sell than it was even a month or two ago!
To prove my point, here are the basic MLS numbers for September 1, 2014 relative to September 1, 2013 for all areas & types:
- Active Listings (inventory): 23,296 versus 18,182 last year – up 28.1% – but down 2.5% from 23,900 last month
- Pending Listings: 5,951 versus 7,302 last year – down 18.5% – and down 2.1% from 6,079 last month
- Monthly Sales: 6,417 versus 7,187 last year – down 10.7% – and down 6.2% from 6,844 last month
- Monthly Average Sales Price per Sq. Ft: $126.10 versus $119.38 last year – up 5.6% – but down 0.4% from $126.60 last month
- Monthly Median Sales Price: $196,000 versus $182,000 last year – up 7.7% – but down 0.5% from $197,000 last month
Regards,
Mike Bodeen
