All statistics going in the right direction last week
Pending Sales 7106 (+39 from last week)
Active With Contingency 1329 ( +75 from last week)
Total Contracts 8435 ( +114 from last week)
Closed Escrow 4.21-4.27.08 1092 ( +11 from last week)
Active Listings 55472 ( -115 from last week)
Closed Month to Date (4.27.08) 3627
All the numbers were working toward the right direction in the last week. The new contracts continues to grow, while the the pendings did only slightly. I was expecting to get to do a headline that "combined contracts crossed 8500" as they were temporarily yesterday, but we are nearing the end of the month, and there is a concentration of closings this week, so many pendings came off the board. Which is a good thing, obviously. Allof the other stats show another week of stability in the market, albeit in the face of more negative national news. We still have an overloaded inventory, to be sure, but if sales can continue to grow despite these challenges, we will eventually start coming out of this. We have shaved several hundred properties off the MLS inventory number over the last few weeks, but it is still an almost insignificant change. I think we will hit an increase in sales for the month over March, and that is including having one less day to do it in. It seems prices will likely remain weak for the time being as inventory still overhangs any sales growth. This will likely lead eventually to increased sales, as the large attractive market of lower priced homes will bring people here, and convince potential first time home buyers to make a move to ownership. It is the law of economics, despite what naysayers wish to crow about the undoing of the housing market. It is not a matter of "if", it is a matter of "when", and in the scope of things, that could be some more time. Still, it is hard not to read into this with some optimism that we are starting to turn the tide. I have been talking to homebuilders to have been snapping up finished lots at discounted prices, getting ready for the next cycle. The building prices are undoubtedly going to be lower than what we have seen, as the market paradigm has shifted from the frivolous nature of the construction boom that started in the early part of the decade-don't expect to see granite in every spec home in the new subdivisions.
This ties into the land market. Many areas have been hard hit by the home price deflation. Custom home areas like Wittmann, Desert Hills, and North Scottsdale which once boasted impressive land price acceleration due to the evermore luxurious construction, have fallen into a funk, and prices have decreased accordingly, and there are still relatively few buyers. Smart money is starting to pick up these lots at bargain prices, but there is no urgency yet from land investors, as they still feel the price will be the same or lower 6 months from now. We have not reached the interest level for investors yet in this recovery for much of this kind of property. There are few sales, and the sales that have occurred have been at incredibly soft pricing. I did read that March new home sales ticked up over the previous month, but it is still to soft to give the builders much optimism.
It will be interesting to see how things play out in the summer months.
chris
No comments:
Post a Comment