The November market followed the same pattern as September and October, down from the frantic activity of last fall, but up over the market bottom of 2008. The values have stabilized (price per square foot) in the past six months and available homes for sale have continued to fall, which are both positive signs towards a more stable market. Overall the number of month’s inventory is still in the Buyer's market range, but at 5.1 months, it is getting close to balanced.
It is interesting that the average day on market for homes sold has remained about the same over the past two years. The average days on market is a good illustration of the "Tale of Two Markets" that we are seeing. A small segment of the market is well priced and selling quickly while the majority remains priced out of the main stream, taking months or even years to sell. So even as available home inventories fall and sales rise, it is all "churning" within a smaller segment of the market. For Sellers, that means they need to be fully aware of the total market and focus on SOLD properties over active listings. Be careful pricing against your current competition. Those still on the market after six months are priced out of the market and not relevant competition.
As expected, our current business mix has shifted even more towards Short Sales in the past few months, currently running at 33% of sales. Traditional sales have also risen to 29%, from a low of 10% in 2008/early 2009 and bank sales about 16%.
So what will next year look like for real estate? We would expect it to look and feel a lot like 2010, maybe down a bit in number of homes sold, but growing stability in pricing. Also a continued decline in available home inventories, but not falling as fast as 2010 (more bank properties and an improving market will bring out those sitting on the fence). If we simply match 2010, that would be a great success, since it would mean our core economic improvement has made up for the artificial market push this year from the tax credits.
