The residential real estate results of YTD 2013 show our real estate market recovery has slowed enough to warrant more careful review. Or is it just a one month blip? Why is it that we cannot keep pace with the spring of 2012 in home sales? April 2012 saw 144 sold, while April 2013 had a total of 112, a drop of 22%.
We had monthly increases for 10 straight months and 14 out of the last 15, until this April.
Maybe April was just a fluke, a one-off. It is very likely May 2013 will equal or better May 2012. Last year May included 119 sales. Quick math: 120 sales this year May would be an improvement. But you know I don’t put any importance on just one month of results.
Much has been said and written about the decrease in inventory of homes for sale. True, for the last 5 years the number of homes for sale has continued to drop, with a 10 year low point in January 2013. And true also that inventory always climbs in the spring season, as “hope springs eternal” among sellers hoping to move away from the home they have tried to sell for a long time.
The growth in inventory since January is not at all unusual and tracks the same periods from previous years. It is difficult for me to conclude that the lower inventory meant fewer sales, as if potential buyers couldn’t find a home to purchase. Yes, there is less to choose from, but we still have 1552 homes for sale in Santa Fe city and county, while the monthly absorption number is around 135 homes (despite the April anomaly). Of the 135 plus home buyers that will ring up a sale this month, they are choosing from a pretty healthy number of homes.
My personal observation: there needs to be more balance between inventory and sales before we could successfully document a shortage. A balanced number of homes would put the “number of months” absorption figure close to 6 months. We are above 11 right now.
Compare our absorption history of late: Mid 2009 we had 23 months of inventory while now we have less than half that. That’s a positive sign!
But Alan, is there any other Good News? You bet!! Look at these numbers: total sales for the prior complete 12 month period as of the last 3 dates of March 31st… (translate; April 1, 2010 to March 31, 2011, etc. etc.)
2011 = 1301 2012 = 1400 2013 = 1654 That is an increase of 27% from March 2011 (a mere 2 years ago). Most of that growth is found in the under $500K range, the strongest segment of our market. Plenty of details are available in the Stats and Charts section of the blog main page. Click the header at the top of this page to return home and see for yourself.
Despite April’s little stumble, our big picture, our go long point of view, looks very good indeed, thank you.
If you haven’t reserved that floral arrangement or made brunch plans for Mother’s Day, get busy so you don’t get shut out. May the Mothers of the world teach us to be honest, loving and fair to our fellow human beings. May they get all the credit for their children’s health and happiness. And if you can’t figure out the right thing to do, ask your Mother… because your Mother should know.