From the following graphics you can see the drop in inventory, especially on the low end. As well as the fact that in many spots demand is lower than the previous year for the market segment but Months Supply has still dropped. Inventory is being worked off and new supply is being held off the market.
7 comments:
"Inventory is being worked off and new supply is being held off the market"
Hello - How do we use the data to determine that "new supply is being held off the market"?
Thanks!
jimi
Beyond the government and bank issues impacting inventory is the low volume of non distressed homes for sale. The reasons are many but generally it comes down to not getting their price point. One has to wonder if the stranded homeowner market is so locked into the bubble price points for whatever reason that the market will simply grind down on low volume similar to Japan.
ED,
Great chart. Thank you. Could I talk you into doing one for my micromarket (91011)?
It looks like your 2009 numbers are raw, not annualized. If so, then volumes appear on track to surpass 2008 volume for all categories below $600k, to come close in the $600k-$800k bracket and to suffer greviously above that $800k-$900k mark. All of which ties in directly to which loans are gov't backed (417k and 729k).
As you note, discretionary sellers are pretty scarce, because anyone who bought during or after 2005 is probably underwater. So divorce, death, corporate relocation or cashing out to wait for prices to fall are about the only drivers out there for discretionary sellers, unless they bought a long, long time ago and are over the age for rolling their prop 13 status to their next property.
What should be feeding the beast is trsuee sales and REO listings, but as we know, they're clenching the sphincter prettty tight trying to not let too much ooze out at once.
Jimi-
You can't tell it from this chart but from watching foreclosures getting delayed and the tremendous lengths the administration is going to to pressure servicers to keep non-paying borrowers in "their" homes.
Anon2-
I can give you inventory and sales for 91011 for 2009 but only sales for 2008, inventory isn't something that can be seen at a later date. Would you still like the data?
Right, I see the foreclosure delays and non-listed REO's in my market (Northern Virginia)as well. Additionally, the traditional default rate on loan modifications was 50%. That was prior to the current loosened standards (LTV and DTI changes). So, there's clearly distress inventory being pushed to the future. I was just hoping for a way to effectively quantify it.
jimi
I'd love it - I have access to the Redfin/Trulia/Zillow data, but I have doubts on their accuracy on number for sale versus number sold, and I have looked at MelissaData for 91011 for sales on a monthly historical basis to get a sense for how much things have slowed down during 2009, and also to get guage what the current "month of inventory" number really is in my micromarket. But it's the classification by price range that makes your chart soooo much more useful in this schitzophrenic (sp?) market. You can email me at smcloughlin@hillfarrer.com - thanks.
Sean-
I will definitely get you the data but it will be Monday night.
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