Lawrence Yun, National Association of Realtors® chief economist, said there were no surprises in the existing home sales data released Monday: “It’s significant that home sales remain above year-ago levels, but the market is going through a period of swings driven by the tax credit.” Existing-home sales – including single-family, townhomes, condominiums and co-ops – fell 16.7 percent from November’s sales but remained 15.0 percent above the level in December 2008. For all of 2009 existing-home sales were 4.9 percent higher than in 2008 -- the first annual sales gain since 2005.
That news doesn’t sound too bad to me. The financial market headlines, however, screamed “Existing Home Sales Plummet,” focusing on the drop from November to December rather than the year-to-year gain.
Meanwhile, in Flagstaff, home inventory levels are the lowest they have been in a long time, with under 7-months’ supply of homes for sale based on single-family Flagstaff homes listed for sale vs. sales so far in January – that’s likely to drop to around six-months’ supply for the full month with end-of-the-month sales. It’s definitely not a buyers’ market in terms of selection right now, through prices are significantly below where they were a year ago. For details on December home sales in Flagstaff, see Monthly Flagstaff Real Estate Update.
Back to the NAR press release on national existing home sales: Yun forecast “another surge in the spring as home buyers take advantage of the extended and expanded tax credit. By early summer the overall market should benefit from more balanced inventory, and sales are on track to rise again in 2010. However, the job market remains a concern and could dampen the housing recovery – job creation is key to a continued recovery in the second half of the year.” That’s a pretty big caveat, Mr. Yun!
The national median existing-home price3 for all housing types was $178,300 in December, which is 1.5 percent higher than December 2008. “The median price rose because of an increased number of mid- to upper-priced homes in the sales mix,” Yun said. It was the first year-over-year gain in median price since August 2007. NAR President Vicki Cox Golder, owner of Vicki L. Cox & Associates in Tucson, Ariz., said market conditions are challenging in some areas. “There’s a shortage of lower priced homes for sale in much of the country….,” she said. We have the same problem in the Flagstaff homes market. Inversely, there is a glut of higher priced homes – a lot of “shadow inventory” in those higher priced categories – homes that are being held off the market pending firmer, higher prices.
According to NAR, distressed homes, which accounted for 32 percent of sales last month, continue to downwardly distort the median price because they generally sell at a discount relative to traditional homes in the same area. Distressed homes accounted for 36 percent of total sales last year.
For more details and statistics on the national home sales market, visit the Realtor.org website and see the full press release. To buy or sell any Flagstaff home, contact me: www.BestFlagstaffHomes.com. |
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