The Memphis Area Association of Realtors has released the November 2008 and 2008 YTD sales figures. November had a steep decline (31.2%) from 2007 in total sales and a 22% decline in median price of sold properties from 2007. Year-to-date, total sales are down 19% – 12,643 vs. 15,609 in 2007, and median price has dropped 13.1% from $137,000 in 2007 to $119,000 in 2008. The report has break outs of sales data for areas and price ranges. I believe we will see the median price trend down as the REO (foreclosure) inventory sells at bargain prices. Foreclosures are impacting values used by appraisers, which trickles down to evaluation of homes for new mortgages or even refinancing with today’s incredibly low rates. I have not had any trouble arranging for mortgages for qualified buyers, but there seems to be a large pool of buyers out there treading water feeling around for the bottom of the market. That is the greatest factor in low sales numbers. I don’t know what the sign will be, but when buyers perceive a solid bottom, I believe they will come back to the market place to shop for bargains, despite other indicators in the overall economy. On the listing side, the area has the lowest number of active listings in about 2 years. My very unscientific read is that lots of folks who have not been able to sell their homes in the initial 6 month to 1 year listing period, are just not putting their homes back on the market when listings expire. In a healthier market, aggressive agents would be barraging those expireds with listing pitches. I am just not seeing much of that. So, we are in a short term state of malaise, but I think we are approaching the point where even I will be able to say “It’s a good time to buy.”
In the > $1,000,000 category, the absorption rate is 2.8 units per month, bringing the Spake Index for this month to 58.5 (58.5 months -yes almost 5 years- supply of homes over $1M now on the market)
I guess better late than ever, as sluggish figures lead to sluggish response. The Memphis Area Association of REALTORS’ Home Sales report for October 2008 and YTD has been out for a while, and I anticipate the November numbers to be out before Christmas. The downward trend continues in number of home sales (-18.6% YTD from 2007) and the median price (-13% YTD from 2007). Total number of listings is down significantly at 11,343. Interesting stats in the area details : Sales are way down in the ‘burbs, Bartlett, Germantown, Arlington, and Collierville, but median sales prices are holding their own with only single digit decreases. This is a comprehensive report that should be of interest to homeowners as well as active buyers. Good news for the over $1M market, as the Spake Index for October =51, a five month drop in inventory since September. Download and read the entire report
The report shows only a 3.1% decline from September, 2007 sales, but total sales for the year are off 18.4% (2007: 13,152; 2008: 10,733).Median price is off 12.9% from 2007, and average sales price is off 13.2%.Inventory showed a significant drop from prior months, which, to me says that fewer homes are going on the market, or homes are being pulled off the market, or expired listings are not being relisted.Whatever the reason, based on the Law of Supply and demand, this is a positive sign.
Remember, I am not one to get up on his soap box and preach that now is the best time in history to buy a home.That is a consumer decision, however, in helping my clients weigh their options, the market seems favorable.The only way we will know we have hit bottom is when we have passed it, and prices are on the up-trend.Homes in certain price points and parts of the area seem to be doing pretty well.There are more important factors than getting a â€œgood dealâ€ on a house.Stay on top of whatâ€™s happening in the mortgage market as banks continue to tighten up on their requirements.For home sellers, the 3 timeless rules apply: Excellent condition, great price, super marketing.
A market I have continued to look at, even though it probably has very little bearing on the overall market is the $1 Million+ range.Based on 2008 sales and the amount of inventory, there is 56 months of inventory of over $1M properties.I am, hereby, dubbing that number the Spake Index â€“ yet another index for pundits to track.The Spake Index for September=56.
Review the full report at http://www.spake.com/downloads/September2008stats.pdf