On Wednesday I blogged about the national home sales numbers being down 33%, those losses were almost entirely in the Northeast (thanks Michigan and Detroit!). I thought I’d follow that post up with some numbers from Salt Lake County comparing May of 09 to May of 2010, where we’ve actually increased the number of homes sold by 16.7%. Here’s the full report from my friend at L1 Real Estate Brett Matsuura (www.brettmatsuura.com).
Salt Lake County Homes Sales Up…Avg Sales Price Down
It’s all of the news that May sales have plunged 33% across the Nation. In fact, a headline in USA Today says “New Home Sales Plunge 33% with Tax Credits Gone“. Let’s keep in mind that this figure is a combination of the entire Country and does not reflect what is happening in Salt Lake, Utah. In fact, you may be surprised and what I have to say.
In May 2009 there were a total of 1011 residential properties sold. In May 2010 there were 1214. This is an increase of 16.7%…a far cry from what the headline said in USA today.
Currently, the absorption rate for Salt Lake County over the past 90 days is 1084 homes per months. According to the Wasatch Front Regional MLS, Salt Lake County currently has 9169 homes that are either Active on the market or under-contract (I don’t count under-contracts as sold until they actually sell) and this gives us a monthly inventory of 8.45 months.
The average sales price in May 2009 was $225,000, in May 2010 $200,250…this is down by 11%.
So what does all of this mean. Well…a balanced market is 6 months inventory. Anything over 6 months is a buyer’s market and anything less than 6 months is a seller’s market….the higher the number the more severe the buyer’s market and the lower the number the more severe the Sellers market. Around 8 months ago…we had as high as an 18 month inventory….so we have come a long way in that aspect.
In a Buyer’s market, home prices will always fall. Just like in a Seller’s market they will always go up, so…this is normal.