September surprise-Almost 8000 closings!
AWC falls, are short sales starting to move?
Fall in pendings, actives slightly higher.
Home prices: Up or Down in September?
PENDING: 12,560 ( -588 from last week)
Pending SFam: 11,050 ( -546 from last week)
AWC: 6,533 ( -56 from last week)
AWC SFam: 5,785 ( -62 from last week)
Active: 31,320 ( +103 from last week)
Active Sfam: 24,113 ( +82 from last week)
Closed 9/29-10/4: 2,134 ( +20 from last week)
Closed SFamily: 1,870 ( +15 from last week)
Closed September: 7,946 (September '08: 6,067)
Closed Sfam: 6,961
September finished fairly strong, almost reaching 8000 sales which I didn't expect. The number of sales shows there is still some life in the market before the dormancy that usually hits us in October and November and lasts until March. Pendings took a little dip, which is fairly normal, as quite a few closings at the end of the month will disappear. They normally rebuild over the next several weeks.
I thought it was interesting to see AWC fall; this number has climbed pretty well forward for the the last year, mostly due to long-lived short sales residing there. Its possible that they are starting to move a bit, or that short sales in the system might have crested and could now start disappearing a little. Its not the ideal time of year, as there is not a lot of sale momentum going into November, but the pendings are still relatively high, and November is likely to show up okay. There have been some historically low interest rates, and there is still some buyer activity out there.
The best stat is that sales ended up stronger than expected; as I really didn't have a lot of faith we would cross 7500, and we fell just short of 8000. That is a very good month, by any measure of the circumstances we are in.
It is also necessary to place this in the context that the new home sales index has been stronger for much of the year than in either 2007 or 2008, and has been making even bigger gains the last several weeks as well, hitting a peak last week not seen since 2006. This is not to say that there are tremendous raw numbers of sales, but the index uses sales to subdivision ratio, and that ratio is tremendously better than last year or 2007. The most telling way to look at this is: in 2008 for the same week, the traffic to sale ratio was 21:1. That means for every 21 people who looked, one person bought. The 2009 ratio for the same period is 10:1! That is showing marked improvement, and is one of the reasons that there are getting to be more cautiously optimistic builders. It is not a bull market for them, by any means, but they can at least see that things are moving in the direction that they can start thinking about putting up homes again to meet demand.
Now, the best for last. The most fascinating statistic that I found for September sales was that the median sale price for sold listings jumped from $126,000 in August, to $130,000 in September. That is about a 3.2 % increase in price. That is a great sign. The dollar volume of sold listings also increased over August, and has bested the 2008 monthly dollar volume for the last four months, and 5 out of 6. This is also a positive sign. These are leading indicators about trends, and as we saw from 2006-2008, the trends don't change very quickly, they tend to follow a course. We are on a course for a better real estate market in six months than we have today, and I think we can take some comfort in that.
The number of new listings has also continued to decline over the summer. March is the highest number of new listings, but June was the highest this summer. We have fallen since then. It is still a relatively high number compared to sales, but apparently, we have reached something of an equilibrium in inventory. It might rise a little, but the number of new actives tends to fall pretty sharply in November-December. There are variables of course, such as lender listings, but they have been claiming that since March, and it has yet to happen. In fact, it looks like March was the peak month for listings this year, and we weathered that. We would have to see a catastrophic amount of listings in October, with a drastic reduction in sales, to really erode our position of a real estate recovery at this point.
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