October to be a slow month for sales
Pending: 11,425 ( +147 from last week)
Pending Sfam: 9,941 ( +100 from last week)
AWC: 7,659 ( -127 from last week)
AWC Sfam: 6,620 ( -117 from last week)
Active: 19,733 ( +43 from last week)
Active Sfam: 15,507 ( +73 from last week)
Closed 10/17-10/23: 1,553
Closed Sfam: 1,323
New listings in October: 7,453
October is shaping up to be a soft month this year, with sales perhaps reaching their lowest point since February. Much of this has to do with the summer swoon we experienced when the debt discussions came about. Weakened consumer confidence is the result. There are of course, other factors. October is often the third weakest sales month of the year, research shows. We are going to be looking at sales in the 7000, most likely, and I think it will surpass February, but we will have to see how this week goes. The good news is that pendings are trending upward again, although we are likely to see that fall at the end of the month when there is a rush of sales.
Active listings are also climbing, as expected, but ever so slightly as to be almost flat. We are in our slow season, but we still continue to see soft numbers of listings. Less listings and more sales means its difficult for inventory to grow. A few more months of this level of inventory growth and relative sales, and we will be back to our big sales months with very limited inventory to satiate it with.
I want to focus on pending growth; if we can maintain pending sales in the high 11,000's into 12,000's, through the winter months, it probably means a strong recovery in March, including on prices. That will mean relatively few homes available, and lots of demand, because once we get to March there will be a lot of buying pressure on the relatively few homes available. I would also like to mention that pendings are a very true indicator of traditional sales; professional investors are buying many of the homes at courthouse steps, while retail investors and home livers buy them through MLS. The word is that there is strong demand at the auctions, which means inevitably some of these homes will appear in MLS once rehabbed. However, many will be turned into rentals, and ultimately, we may see the effect of too many investor purchases turning into a boon to renters in a few years, as there will be a lot of rental properties. Of course, right now, there are lots of renters, so it is lucrative. There was article discussing that today: there is solid growth in revenue for investors.
Overall, we are kind of sitting in the doldrums for a while; the president came up with some new programs for refinancing that I think almost everyone is non-plussed about. The government can't save housing short of making lenders take a massive haircut, or do quickly adjustable loans, and they are not doing that. Everything is a half-measure, so don't expect their program to make a lot of difference or cause even a stir.
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