Happy St Patrick's Day!
Today we hit an equilibrium where the number of homes settled to date equals the number of homes pending at 560 properties. This in itself carries no particular significance except in relation to past experience. In 2010 we hit this point on April 29 when the numbers equaled 1152 properties.
The implication here is a lack of buying activity. Compare:
Year: Homes on the Market | Homes under Contract | Homes Sold
2010: :3208 794 578
2011: :3576 560 560
Change: +11.5% -29% -3%
If you simply add the Homes on the Market to the Homes Under Contract, the totals are within 3% of each other (4002 vs 4136) The lack of buyers putting homes under contract is the only difference.
Positive: There are several positive implications here. From a seller's perspective, the need/desire to sell has remained fairly constant from last year as overall available homes has remained fairly steady. This could moderate pricing pressure. From a buyer's perspective there is an increase in available inventory/choices and you may have a bit more time to consider your move.
Negative: If the need to sell overcomes the buyer demand, prices could easily retreat further.
Clearly we continue to be in a holding/weaker market as buyers and sellers weigh the implications of the overall economy, potential conflicts/resulting rise in energy prices, and the impacts of the problems currently happening in Japan. The result is a market consisting of lower activity with fewer but motivated buyers and sellers.
With the continuing low interest rates and strong inventory, this continues to be a great time to buy, but this could change very quickly. If the conflicts in the Middle East are resolved, energy prices moderate, and Japan stabilizes, there continues to be pent up demand that could quickly reduce the existing inventory, firm prices, and raise interest rates.
Long & Foster Real Estate Inc – Newtown Square,PA/Bear, DE
Office: 610-225-7400/Cell: 610-618-0808