***September Sales Tops 8,000***
Median Prices Sharply to $113K- highest of the year.
Inventory rises again as season fade in buying activity hits
Pending: 10,982 ( -1056 from last week)
Pending Sfam: 9,614 ( -929 from last week)
AWC: 7,554 ( -234 from last week)
AWC Sfam: 6,556 ( -188 from last week)
Closed 9/26-10/2 2,760 ( +1195 from last week)
Closed Sfam: 2,376 ( +1029 from last week)
CLOSED MONTH OF SEPTEMBER: 8,020 (+19.7% from Aug.2010)
Active: 19,480 ( +184 from last week)
Active Sfam: 15,249 ( +113 from last week)
New Listings in Sept.: 9,583 ( September 2010: 12,841; August 2011: 10,292) -25.4%
Median Price: 113,479 ( +$4,479 from August 2011) 4.1% increase
September Sales finished fairly well, as the sales numbers look to have topped 8000. That is very good for September, but is definitely down from the excellent month of August. It is not extraordinary, but its is a sustainable number for the slow season. Continued sales in the 8000's for the rest of the year would put us at 12-13% increase. I think that is fairly likely to happen. This will end up being a pretty fair year for sales, i think.
Maybe more importantly than the number of sales is the fact that the median price rose somewhat unexpectedly. I should say we have been expecting a rise for quite a while due to market forces, but it has stayed flat, so we had just about come to accept that. Now, we had a sudden price rise in a relatively quiet sales month, and it raises some eyebrows that maybe are going to head in the right direction on prices, given inventory levels, and what is another strong indicator of higher prices: a higher median listing figure. That number has been rising for several months now, and it went up almost $7000 in September from August, and its actually $10,000 higher than last September. That is also very significant, as it does show either lower priced inventory is being cleaned up, or that sellers are more confident in their pricing, but as I have said on more than one occasion, it is likely a mix of the two.
We are entering the Autumn doldrums for sales, and it is starting to show up. September sales were a bit slower, and that is being followed now by lower pendings and a slight uptick in inventory. This was expected, but we expected it to happen in July, so we have had a good extra quarter of inventory reduction. I expect inventory to build at slight levels for the next few months, maybe take a breather in December, before rising a bit in January. Come February though, I do expect us to start burning inventory off, as buying demand picks up. It has been mentioned before in this blog, but February and March are key demand months, and what little excess inventory is currently on the market will quickly be absorbed by demand in the spring buying season. This will spark some price increases at that time.
It really is too bad I didn't post in the fourth quarter last year, so we could compare trends, but we did seen inventory build through that time frame. Sales are stronger this year, with less inventory coming on the market, so we will build but not quite as quickly. I do expect a strong buying season in 2012. I think that our overall economy is getting better, even if it is at a slower pace than any of us would like, and I do think there will be more confidence in buying at the price levels we are at. The median price increase is indicative of a better confidence level, and relative scarcity of available housing, and I think we will see even more confidence by the time springtime rolls around.
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