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S o I’ve heard a few times in passing recently that the housing market is worse than a year ago, and folks wondering aloud when it will change, so I took a look at some market activity numbers this morning and found that things are indeed much better than a year ago and I can’t see them moving backwards at this point. Through August, Anacortes has seen a 27% increase in homes going under contract versus the same period of time in 2009. We have seen a 32.5% increase in closed sales the same time period. Our inventory, the number of homes listed, was only 11% higher in August, than at the beginning of the year. This same January to August time period in 2009 saw a 58% increase in inventory, in 2008 it saw a 44% increase in inventory. I believe it’s a great sign that the inventory is starting to level off, and if I calculate the average number of homes on the market in any given month, we are actually starting to lose inventory overall. This is needed for a healthy market, which the National Association of Realtors pegs as a market in which there are six months of inventory available. In 2010 our Months of Inventory based on closed sales dropped 27% from its 2009 levels. We are still high, but headed in the right direction.
This all means to me that the market activity has picked up and we are past the bottom of the activity market. This doesn’t mean we’ve reached the bottom of the value market, but if we haven’t we must be close. Our average price per square foot is down 5.5% this year to $167.50, and there is a chance that will drop a bit more – but not much. If sales continue to pick up at the pace we’ve seen happen in 2010 versus 2009, we will be fairly close to 2007 numbers which will cement my theory that we are past the activity bottom. On a pricing note, more activity plus fewer listings equals upward pricing pressure. On an affordability note, which is different than pricing, interest rates literally have no place to go but up. If there is a one point change, any small remainder of value loss will be more than offset by the interest savings on your 30 year mortgage.
Next year you will wish you had bought this year, that’s my story and I’m sticking to it.
