***NOVEMBER: 7,246 Sales***

Median & Average Price up in November

Sales are modest, but best November 2010

Overall Inventory falling toward 18K's; Single Family dropping to 14K's

New listings in November reach multi-year low

Pending: 10,453 ( -481 from last week)

Pending Sfam: 9,135 ( -382 from lat week)

AWC: 7,335 ( -187 from last week)

AWC Single Fam: 6,355 ( -160 from last week)

Active: 19,292 (-213 from last week)

Active Sfam: 15,081 ( -184 from last week)

Closed: 11/28-12/4: 2,341

Closed Sfam: 1,988

Closed November: 7,246 (+8.4% better than November 2010)

New listings in November: 8614 ( -2601 listings, or 23.2% less than Nov.'10)

Median Price: $115,000 (+$3000 from October, 2.7% increase)

( -$50 from November 2010)

Average Price: $160,091 ( November 2010: $158,695)

( October 2011: $153,289)

Sales were modest in November, but very positive regardless. November is traditionally a quiet month, so softer sales are not unexpected. The tally was over 8% better than the same period in 2010, so we are still looking at a strong improvement. They were a bit softer than increases logged by previous months however, if you are a dark lining in a silver cloud kind of observer.

Also up was the median price, which reached $115,000 for the first time all year long. The number had bounced between $109K and $112K most of the year, but we might be seeing a bit of a breakout here. Supporting that idea is the fact that the trend line in price year over year are crossing for the first time all year long, and possible in many years. Last November, median prices were still falling, and finished at $115,050. In a statistical tie with that, 2011's trend line has finally caught up with previous years. This implies that we are moving toward a healthier market. This is of some significance.

While the median is actually $50 short of last year, the average is actually higher, so what I can say now is that we are statistically better off than we were a year ago at this time for the first time since probably 2006. Better prices, better inventory numbers, fewer foreclosures. We have without a doubt, been heading in the right direction; now we can definitively say that we have reached a milestone.

The pending numbers are pretty run of the mill following the end of the month, so there is nothing too interesting there, but what is interesting was the relatively sharp drop in inventory. This is the lowest number of new listings since at least 2009, but likely the lowest since 2004 or sooner. December is typically even smaller, but I am not going to make a call on that as it would be purely speculation. Suffice to say, we are not building inventory, and this matter will raise its head in February and March when the house hunters come out to play.

I will speculate now however, that we will probably see some losses in sales year over year. There will not be the kind of discounted homes available to people that there were in 2011, and as such the investors may pull in their horns a bit. That's okay, because as of right now, there would not be the inventory to accommodate them. Take March for example. We currently have inventory of 19,000. In March of 2011, there were 9,957 sales. There were about a similar amount of listings, but please take into account there are also anywhere from 11,000 to 14000 pendings during this period, and AWC homes as well. There is no perfect way to measure the inventory burn, but in March of 2011 we were burning off 650-1000 per week. Perhaps it won't be that high; it cant be, its just not sustainable given inventory replacement figures. But even at half of that burn, there will be considerably less inventory available for what should be a strong buying season, given economic recovery and increased confidence. Safe to say, those are inflationary pressures for housing prices. We are experiencing it even now, but they will become even more magnified in the spring. Last year inventory started burning in February, but we had 34,000 listings on the market; almost double what we have now, so there was some slack still in the inventory. Where is that slack going to come from now?

It is hard to say if there will be an uptick in new listings; maybe there will be, but the pipeline from bank sales appears to be slowing. Short sales are nowhere near their peak either, so I don't a strong uptick if there is one. It is hard to imagine that the inventory will be this low, however. It is not sustainable, and it will drive prices up in this market. As mentioned earlier, it has already started to some degree, but the competition is nowhere near where it will when we reach February and March. Look for some solid if not spectacular pricing pressures by April.