In an ongoing effort to post consistent and timely real estate market updates, here below is a Concise Market Snapshot from The Cromford Report, and my own short commentary afterward. This snapshot has been re-posted with permission from The Cromford Report.
The 2011 spring real estate market is upon us, and it has proven to be an exciting one. For proof, just take a quick look at the latest Sales per Month and Months Supply statistics on the chart above. The Sales per Month statistic, which measures the number of home sales over the last rolling month, is up by almost 2,000 compared to April of 2009. And the Months Supply statistic, which measures how many months it would take to sell all the active listings if they were to sell at the rate implied by the number of Sales per Month, is now at a level most real estate economists would say is indicative of a balanced market.
So, it’s not a buyer’s market anymore?
First, it’s important to remember that the real estate market is hyper local, so different areas and price ranges recover faster than others. For example, there is only a 1.3 month supply of (lender owned) REO property here in the Greater Phoenix Area. That particular sub-market is considered a seller’s market now.
Second, there is no single definition of a buyer’s market. Instead, there are several indicators/signs of buyer’s markets, such as declining median sales prices, and, low levels of closed sales. As we transition out of this recession, we will begin to see signs of a balanced market on the horizon even while we see other signs of a continued buyer’s market. For example, this month’s median house price of $110,000 is lower than it was in April 2009 (indicative of a continued buyer’s market). However, the number of Sales per Month is now dramatically higher than it was in April 2009 (indicative of a balanced market heading toward a seller’s market).
Last year, we expected prices to fall in July because of the expiring home buyer tax credit. This year, there is no expiring home buyer tax credit, so if the trend of falling supply and increasing demand continues, you should expect the median monthly sales prices to begin to increase as well. Whether the first significant increase will happen next month or next quarter, I can’t say, but I can say it is unlikely that prices will fall any further under these conditions.
**If you would like a chart, similar to the one above, prepared for your own city or zip code within the Greater Phoenix Area, just post a comment below, send us an email, or, give us a call the old fashioned way! We would love to hear from you.**