Much has been made of some recent reports that show increased housing sales for 8 straight months. There will be another report in about a month that shows 9 straight months. After the October numbers, I'm not sure what we will see, but more than likely an increase over last year, and a seasonal (and end of initial tax credit rush) decline from the previous month.
Let's not forget that the market has two parts, with everyone focused on the demand side of the equation, the supply side is often forgotten. The pundits are saying that there are more foreclosures to come on the market and we can be confident that there are, even if we don't have a good picture of the numbers. I would balance this with the sort of pent up demand waiting for good economic news or a feeling that the housing market has bottomed.
In other words, supply and demand work together to give the market stability. So what is happening on the supply side? The inventory of available homes is shrinking, in some markets very significantly. So while we are not totally there, we seem to be headed towards some stability.
Comparison of the major markets covered by Zip Realty. Chart
In the Colorado Springs market, we are seeing supply shrinking quite a bit. Our military buyers are faced with a problem when they arrive to find a home. The well priced homes are short sales that will take too long to close. The REO homes won't pass a VA inspection and generally get bought by investors. That leaves a lot of overpriced junk on the market. Banks need to release more REO listings to ease up on the supply problem.
ReplyDeleteThanks for the comment Shawn. You bring up a good point, in that the big picture may look rosier than the submarket picture. We, REALTORS, say all the time, that "real estate is local." There are also submarkets, whether by location or by price point or others.
ReplyDeleteIn our market it is actually trending towards a seller's market on the lower end and definitely a buyer's market on the luxury end.
We also see the military buyers needing to be very aggressive in their offers because of a lack of suitable supply.