Pendings Rise; Listings Fall
March Closings to Outpace 2009 Handily
March 2010 prices up 6.2% from March 2009
Pending: 13,918 ( +253 from last week)
Pending Sfam: 12,208 ( +425 from last week)
AWC: 7,652 ( +139 from last week)
AWC Sfam: 6,561 ( +112 from last week)
CLOSED: 1,824 ( -33 from last week)
Closed Sfam: 1,563 ( -8 from last week)
Active Listings: 34,799 ( -227 from last week)
Active Sfam: 27,173 (-196 from last week)
CLOSED MTD: 6,930
Closed Sfam: 5,825
March 2009 Sales: 7,562
Pendings continue to show strength in demand for home sales in the ARMLS market area. We did reach over 14000 briefly last week. There are also upwards of 6500 AWC short sales- we don't know when those contracts will close, but they do show that some people are willing to wait for their sale to close, even if it takes months. It still must be considered demand, as someone wrote a contract.
There are some inside the numbers that I would like to focus on. I have heard constantly about the shadow inventory in Arizona for more than a year. We had a tidal wave coming last April. It never materialized, and we slashed inventory from unimaginable numbers down to where we are now- which is probably a normal level of inventory for the size of our market. Its hard to say for sure- we are seeing price gains moving at a signifcant level each month that might cause 25% annual price growth.
That growth rate is actually too high, but given that all real estate is drastically undervalued now, the rise could be attributed to the natural return to normalcy in pricing. I am going to say that we are just a little bit high in inventory level numbers, as I think prices should be rising even faster than what we are seeing them. Price levels of real estate assets is artificially depressed, and remain so only because people are not fully vested in our economy and the idea that life goes on, even after the financial meltdown. We will see some drastic price increases in the next year at some point, as people realize the value.
The median price gain from February to March is probably going to be a few thousand dollars- not a lot, but not inconsequential either. It is about $7000 higher than last March, which is significant. February was the balance point for median price- February of 2010 was $100 higher than last February- prior to that, the prices were lower than the previous year. We are showing year over year growth again.
Another number we rarely look at is the new listings category. March is one of the heaviest month for new listings-in 2009, it was the heaviest volume for new listings. This year is similar, although it looks like we might see just a few less listings in March. The number of sales in march will outpace 2009 by a significant amount, so the number of new listings isnt particularly scary. I will start keeping an eye on new inventory, but its not looking like its out of line at all. The statistics are starting show that we are likely in full recovery mode.
Tuesday, March 30, 2010
Tuesday, March 23, 2010
Pendings Rise in March
Inventory Stays Flat
Short Sales make up most of the category of AWC.
March median price ahead of Feb. '10 median by $3K
Pending: 13,665 ( +1505 from three weeks ago)
Pending Sfam: 11,783 ( +1324 from three weeks ago)
AWC: 7,513 ( +516 from three weeks ago)
-Short sale: 6,619
AWC Sfam: 6,449 (+445 from three weeks ago)
-Short Sale: 5,667
Closed: 1,857 (N/A)
Closed Sfam: 1,571 (N/A)
Active Listings: 35,026 ( +72 from March 2)
Active Sfam: 27,369 (+39 from March 2)
Closed MTD (3/21): 5,036
Closed Sfam: 4,215
It has been a busy month, and I haven't had time to update, but there are a few things worth commenting about here. First off is that pendings are rising sharply as our seasonal demand picks up. Expect to see strong pending numbers through April, and then perhaps a flattening as the rush to utilize the tax credit expires. We are not likely to go down, as the strong summer months will carry us forward, but the April pendings could be exceptionally high.
Inventory has remained flat; we might have expected it to go down, but it has remained steady. February did not have substantially more listings on the market than 2009; in fact, only a 155. March was the largest listing month of 2009, and it maybe also this there. Pricing in March is also substantially ahead of March 2009, and steadily ahead of February 2010- 119K and $125K , respectively, to $128K for March 2010. A good indicator that inventory at this level is not going to lower prices.
I would expect inventory to have started to fall, so I have some concern, but overall, the numbers are fairly positive: we are going to have a decent month of sales in March, the inventory could be lower, but it is not terribly high, and we are seeing month over month median price gains. We also have pending sales growing substantially, and whille I am not a big fan of record numbers of short sale homes under contract, they are under contract, and they have to be thought of as pending sales to some degree. Starting April 5th, I believe, lenders will start getting some government payola to close short sales. I have a feeling that many of these short sales will start to close at a faster pace once banks are paid to close them.
Inventory Stays Flat
Short Sales make up most of the category of AWC.
March median price ahead of Feb. '10 median by $3K
Pending: 13,665 ( +1505 from three weeks ago)
Pending Sfam: 11,783 ( +1324 from three weeks ago)
AWC: 7,513 ( +516 from three weeks ago)
-Short sale: 6,619
AWC Sfam: 6,449 (+445 from three weeks ago)
-Short Sale: 5,667
Closed: 1,857 (N/A)
Closed Sfam: 1,571 (N/A)
Active Listings: 35,026 ( +72 from March 2)
Active Sfam: 27,369 (+39 from March 2)
Closed MTD (3/21): 5,036
Closed Sfam: 4,215
It has been a busy month, and I haven't had time to update, but there are a few things worth commenting about here. First off is that pendings are rising sharply as our seasonal demand picks up. Expect to see strong pending numbers through April, and then perhaps a flattening as the rush to utilize the tax credit expires. We are not likely to go down, as the strong summer months will carry us forward, but the April pendings could be exceptionally high.
Inventory has remained flat; we might have expected it to go down, but it has remained steady. February did not have substantially more listings on the market than 2009; in fact, only a 155. March was the largest listing month of 2009, and it maybe also this there. Pricing in March is also substantially ahead of March 2009, and steadily ahead of February 2010- 119K and $125K , respectively, to $128K for March 2010. A good indicator that inventory at this level is not going to lower prices.
I would expect inventory to have started to fall, so I have some concern, but overall, the numbers are fairly positive: we are going to have a decent month of sales in March, the inventory could be lower, but it is not terribly high, and we are seeing month over month median price gains. We also have pending sales growing substantially, and whille I am not a big fan of record numbers of short sale homes under contract, they are under contract, and they have to be thought of as pending sales to some degree. Starting April 5th, I believe, lenders will start getting some government payola to close short sales. I have a feeling that many of these short sales will start to close at a faster pace once banks are paid to close them.
Tuesday, March 2, 2010
ARMLS STATISTICS FOR 2/22-2/28/10
February Closed: 6,635!
Pendings fall, end of month Sales Up sharply.
Active Listings Start to Fall.
Pending: 12,160 ( -679 from last week)
Pending SF: 10,459 ( -581 from last week)
AWC: 6,997 ( +16 from last week)
AWC Sfam: 6,004 ( +30 from last week)
Closed: 2,655 ( +1236 from last week)
Closed Sfam: 2,243 ( +1,053 from last week)
Active: 34,954 ( -211 from last week)
Active Sfam: 27,369 ( -135 from last week)
CLOSED FEBRUARY: 6,635 (+873 from January)
Closed Sfam: 5,597 ( +668 from January)
February finished with a good sales total, as 6,635 properties listed in the MLS changed hands. The last week was especially strong, logging 2600+ sales. This was way ahead of last years pace, and is an improvement over January as well.
We are also starting to see our active listings start to fall. Last year through the middle of part of the year, we chewed up a lot of inventory. Our inventory grew some over the winter as seasonal sales slowed, but we are starting from a massively lower inventory level than we did at this time last year, and both our home sales and pending numbers point to a lot stronger sales year this year. Tuesday, March 3, 2009, there were 9,587 pending sales, substantially lower than the 12000+ of this year. Sales finished at 5,467 compared to the 6635 we had this year. There were 49000+ listings at this exact time last year, compared with 34,000 this year. We are starting the race with a smaller burden to carry this year, and if these sales numbers hold up, we will see inventory deteriorate rather quickly by the end of June, and probably see significant price gains in homes through the summer. There just isn't enough inventory for prices to continue to see downside risk in housing prices based on these statistics. Between March 3rd and June 1st of 2009, active inventory fell by 15000 units; I don't expect the same kind of fall this year; I expect rising interest rates and the fact that there is already less excess inventory will prevent a precipitous fall like last year, but we are going into an inventory depleting season. If we burn 4000 inventory units in march like we did last year, we are going to start seeing some prices rise substantially in 2nd quarter. We are already at 5.2 month of inventory in February; March sales will be substantially higher, and we could see ourselves pulling down to 4 months in a big hurry. Depending on how strong this trend is, we could see the door open for new homebuilders very soon. It is already looking like we are going to experience at least some seasonal shortages of inventory that will drive prices and competition on the most desirable homes. The banks might be hiding some more inventory out there, but I think we would have seen a lot more of it on the market by now.
The bit of news that I track that bothers me is the AWC contracts. This category used to denote the new contracts- that is not really the case any more, as short sales have been put in this category, and this number has risen to a massive level. Now it is not all bad; these are homes under contract to someone; the problem with them is we really don't have a clue as to when they might close, and it may take months. Think of it as a slow moving pending category with a lower completion rate. It is a picture of demand, as someone is trying to buy these things, but it is a clog in the line as we try to drain the excess inventory off. If the banks were smart, they would make these short sales happen faster.
I am also going to point out a few other areas that have impressed me. There is a submarket in Rio Verde between 136th and 160 where the number of active listings was 49 homes, but also had 29 homes pending. This had been a very strong 1 AC homesite area of upscale homes and pricey lots; it did fall on hard times. However, look at the trend. If the limited number of homes are selling quickly, as the pendings demonstrate, this is going to lead to increased prices, and more importantly to many, a demand for new homes to be built. We are also seeing lots moving fairly quickly in this area at lower prices, showing that people like this area. This will be an opening in the door for small builders, if they can get construction financing.
We are seeing a similar situation in Wittmann, although the land is not quite as rare, and the number of pendings not quite as high in relation to the number of listings, it still seems to be moving at very good velocity. These are two areas that I think the land prices will start to increase later this year as the available number of houses decreases.
We are entering the exciting time of the year for watching housing statistics, and I like that we are off with a running start in February. If March is a good month, we will have a lot to be optimistic about.
Pendings fall, end of month Sales Up sharply.
Active Listings Start to Fall.
Pending: 12,160 ( -679 from last week)
Pending SF: 10,459 ( -581 from last week)
AWC: 6,997 ( +16 from last week)
AWC Sfam: 6,004 ( +30 from last week)
Closed: 2,655 ( +1236 from last week)
Closed Sfam: 2,243 ( +1,053 from last week)
Active: 34,954 ( -211 from last week)
Active Sfam: 27,369 ( -135 from last week)
CLOSED FEBRUARY: 6,635 (+873 from January)
Closed Sfam: 5,597 ( +668 from January)
February finished with a good sales total, as 6,635 properties listed in the MLS changed hands. The last week was especially strong, logging 2600+ sales. This was way ahead of last years pace, and is an improvement over January as well.
We are also starting to see our active listings start to fall. Last year through the middle of part of the year, we chewed up a lot of inventory. Our inventory grew some over the winter as seasonal sales slowed, but we are starting from a massively lower inventory level than we did at this time last year, and both our home sales and pending numbers point to a lot stronger sales year this year. Tuesday, March 3, 2009, there were 9,587 pending sales, substantially lower than the 12000+ of this year. Sales finished at 5,467 compared to the 6635 we had this year. There were 49000+ listings at this exact time last year, compared with 34,000 this year. We are starting the race with a smaller burden to carry this year, and if these sales numbers hold up, we will see inventory deteriorate rather quickly by the end of June, and probably see significant price gains in homes through the summer. There just isn't enough inventory for prices to continue to see downside risk in housing prices based on these statistics. Between March 3rd and June 1st of 2009, active inventory fell by 15000 units; I don't expect the same kind of fall this year; I expect rising interest rates and the fact that there is already less excess inventory will prevent a precipitous fall like last year, but we are going into an inventory depleting season. If we burn 4000 inventory units in march like we did last year, we are going to start seeing some prices rise substantially in 2nd quarter. We are already at 5.2 month of inventory in February; March sales will be substantially higher, and we could see ourselves pulling down to 4 months in a big hurry. Depending on how strong this trend is, we could see the door open for new homebuilders very soon. It is already looking like we are going to experience at least some seasonal shortages of inventory that will drive prices and competition on the most desirable homes. The banks might be hiding some more inventory out there, but I think we would have seen a lot more of it on the market by now.
The bit of news that I track that bothers me is the AWC contracts. This category used to denote the new contracts- that is not really the case any more, as short sales have been put in this category, and this number has risen to a massive level. Now it is not all bad; these are homes under contract to someone; the problem with them is we really don't have a clue as to when they might close, and it may take months. Think of it as a slow moving pending category with a lower completion rate. It is a picture of demand, as someone is trying to buy these things, but it is a clog in the line as we try to drain the excess inventory off. If the banks were smart, they would make these short sales happen faster.
I am also going to point out a few other areas that have impressed me. There is a submarket in Rio Verde between 136th and 160 where the number of active listings was 49 homes, but also had 29 homes pending. This had been a very strong 1 AC homesite area of upscale homes and pricey lots; it did fall on hard times. However, look at the trend. If the limited number of homes are selling quickly, as the pendings demonstrate, this is going to lead to increased prices, and more importantly to many, a demand for new homes to be built. We are also seeing lots moving fairly quickly in this area at lower prices, showing that people like this area. This will be an opening in the door for small builders, if they can get construction financing.
We are seeing a similar situation in Wittmann, although the land is not quite as rare, and the number of pendings not quite as high in relation to the number of listings, it still seems to be moving at very good velocity. These are two areas that I think the land prices will start to increase later this year as the available number of houses decreases.
We are entering the exciting time of the year for watching housing statistics, and I like that we are off with a running start in February. If March is a good month, we will have a lot to be optimistic about.
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