Inventory still trending slightly downward
December a wild card?
***2011 sales have already passed 2010 total***
Pending: 10,982 ( -88 from last week)
Pending Sfam: 9,573 ( -56 from last week)
AWC: 7,617 ( -81 from last week)
AWC Sfam: 6,596 ( -58 from last week)
Active: 19,602 (-28 from last week)
Active Sfam: 15,339 ( -53 from last week)
Closed 11/14-11/20: 1,842 ( +475 from last week)
Closed Sfam: 1,539 ( +362 from last week)
Weekly sales were very strong for a mid-month week, which bit into pending sales slightly. Sales up near a third from last week, probably due to buyers avoiding the holiday week to close. This reduces the pending category, as more sales mean pendings decline. The fall wasn't large, but it does show the seasonal weakness.
More surprising is perhaps the continued decline in inventory, despite the weaker sales activity. The sales figures are likely to beat last year, but they are going to be down from previous activity. Apparently, so is listing activity, which shows we will probably fail to reach 10,000 new listings in November as well.
I am not sure what December will bring; last December was surprisingly strong, but we are really not sitting on enough pendings to make the same numbers as December of 2010. I could be wrong, but I don't have any statistics about pendings from last November to say for sure.
I still believe that the median price will fall in November from its $115,000 level right now, but it should hold its ground above $112,000, which is what October was. The average price is running considerably higher in November as well, at $163,800; that's an increase of nearly $10,700. That also shows real gain in the pricing of the market. I would expect that number to mellow by the end of the month, but it does look like there will be a strong gain this month. It is the fallout of simply less inventory available. Its not there, and we are now a good way through the perceived "off-season" of homeselling in Arizona. We have gone through 11 months with over 17% reduction in inventory, and 11% increase in sales. I do expect a solid rise in inventory in January, as it is usually a heavy month for inventory, but we are at such a low point now, that amount will probably be eaten away by mid-february.
I am still puzzled by December. Last December there were 8,243 sales; a strong month whatever the time of year, but exceptional for what should be the middle of the desert, so to speak, for home sales. If December turns into a good month, then we will not have had much of an off-season. I just don't see how we get to 8,243 sales in December. In fact, with the numbers the way they are, monthly sales run at a 10%+ clip. I don't see that happening in December, and that would be the first month in a long time where there weren't really solid gains. I don't think we can expect those kind of strong numbers in December.
An interesting thing happened this past week. Sales for the year exceeded 2010. We are now at 90,474, compared to 90,111. It might not seem like a big deal, but we still have half of a month of sales in November unreported, and all of December. We knew we were doing better, but this puts the numbers in a perspective we can all understand: December sales are all gravy. Its significant that we are doing better than last year, in sales, but also inventory. We are currently YTD 17.7% behind last year; its likely to finish higher than that. Coupled with increased sales that 30% inventory factor swing puts us in a much healthier position going into 2012 than we had in 2011. Sales of homes could surpass 100,000 for 2011, if December were to be a fair month.
That's about all I have time for today, but I want to wish you all a very happy and safe Thanksgiving!
chris
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