Thought it might be of interest to look at the market as see if we had left a “buyers” market behind. For definition of a buyers market I will use the National Association Realtors definition as to an inventory of homes that would take longer than 180 days for the market to absorb. Now one point I will acknowledge is that market absorption is always longer as we come out of winter and I think 89 continuous days of snow on the ground qualifies as winter.
I have generated two graphs to show the market and condition. First is the inventory graph as of this morning 3/8/2010 the first bar is inventory of single family homes, the positive the inventory is about 3% lower than last year at this time, the second bar, pending sales, we have about 25% more pending sales than last year at this time, closed transaction using the same time frames for absorption 192 days back from today a year ago we have 9.1% fewer closed transactions. The fourth bar is the number of homes that went off market either expired or withdrawn in the absorption time of 192 days at 542 which is greater than existing inventory level is not a positive indicator. What this also indicates it will take a total of about 1023 homes to have been on the market to generate 486 sales or a sales rate of only 47.5% not a great number. The fifth bar is the length of time it will take to find 486 buyers that will actually close a transaction at 192 days that is over the definition of a buyers market since it exceeds a 180 days. The fifth bar is the time it took to receive a contract on those that closed and it is only 50 days this tells us that if a home is priced properly it will sell and sell in a very reasonable time.
This second graph shows the price point corresponding to each of the above categories first is the most obvious that the higher you go into the market place the less likely it is a home is going to sell, (the off market) when you look at the both the pending and closed price points it jut confirms the information of the majority of higher priced inventory not selling. Looking at the active inventory price point also indicates that although the mix of inventory is trending towards lower price and there is most probably inventory that will not be selling.