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January 6th, 2009 10:06 AM by David W. Welch
Here they are, and there are some pretty big moves in inventory and sales. As of this morning on the MFR/MLS there are 22,675 homes available for sale that is down 1,733 from November which has got to be the biggest shift all year. As I mentioned a couple of weeks ago, I will be measuring distressed properties a little differently starting with today. I am not going to try and go back retroactively. Beginning with today's numbers I am including any listing that has 3rd Party Approval in addition to those designated as pre-foreclosure, in-foreclosure, and bank owned. This shifted my numbers up significantly. Of the 22,675 8,157 or 36.0% are identified as distressed properties according to these designations.
Another shift down, that could be viewed as a good thing or not so good are the number of pending contracts. They only went down slightly from November's 3,326 to 3,239 in December. Of the current pendings 1,968 or 60.8% are distressed properties. The effect of distressed properties on our sales is more exaggerated with this new group of 3rd part approval added. Part of the reason for the drop in pendings must be the huge increase in sales. Yes, I said increase in sales in December of all months. Probably caused by the tax credit being offered for first time buyers. Sales shot up to 1,297 from 1,076 in November and is also considerably higher than sales last December which were coincidentally 1,076. A whopping 48.0% of the sales are in a distress situation.
Another increasing number that is a plus for sellers is the median price. November's median came in at a jaw dropping $167,025, while December posted a modest gain to $168,000. I believe this supports my call that we have hit the bottom. One of my subscribers mentioned that I have talked about the bottom a lot this year. That is because 2008 has been a transition year. We hit the sales bottom in January and the price bottom in October. Yes, November and December prices are lower than October, but you can expect an over correction and monthly fluctuations. What I expect now is to stay in the $160-$180 median price range through March. At that point prices will have stabilized and begin a slow ascent. I do mean slow like 1-2% over the next year. 2008 was a transition year, and 2009 will be a stabilization year before really getting back on track in 2010.
Two more quick statistics. The FHA loan limits dropped back to their normal high of $274,850 and currently 15,908 properties or 70.2% of the inventory is below this limit. The months of inventory has dropped from 22.68 in November to 17.48 in December.
David W. Welch, Remax 200 Realty, RealEstateOptimist