QUICK Facts about 2011
* Foreclosure starts for the year dropped dramatically from 4829 in 2010 to 3603 in 2011
* The number of Active Listings is down 24%, indicating the number of listings is very balanced
* The number of Sales for the year were up 3.1% but 35% off the high in 2005
* The number of Sales for the 4th Quarter are up 12%
* The Average Annual Inventory is at its lowest level in 5 years
* The Average Sales Price was $218,172, a decline of 4.4% from last year
* 72% of all sales in 2011 were under $250,000
Quick Look at 2012
* In December the number of under contracts hit 1081, the highest number in 5 years
* 2012 should continue to see the # of distressed sales decrease
* Inventory levels will be similar to 2011, which is currehtly at 5 months
* The High End market is expected to begin a sustained recover - There are already 3 homes over 1Million under contract in the 1st month of 2012
* The total number of sales should increase 3-5%. approaching 9000 units
Looking back at 2011 and how the real estate market performed it seems it has finally
turned the corner. The most impressive result was the number of foreclosure starts being
down more than 25% from the previous year and almost 35% from their highest mark in 2009.
At the beginning of 2011, economists & media were saying banks had been holding on to
foreclosed properties in late 2010 but would be forced to flood the market with these under
valued homes in 2011. It never occurred. Despite the vast improvement, foreclosures remain
historically high and continue to negatively impact home values. Additionally, when many
homeowners are losing their homes it creates uncertainty and lack of consumer confidence
even to those who still own their homes.
Almost as impressive as the foreclosure numbers are the number of active listings and
inventory levels. Active listings at the beginning of 2011 were nearly the same as 2010. But as
the year dragged on listings began to disappear and on December 31 they had dropped to the
lowest level since February 2002; almost 40% below the highest levels reached back in 2007.
While the number of listings shrunk, the number of buyers actually increased pushing the
inventory levels below 6 months.
The only negative numbers to come out of 2011 were slipping sales prices. The average sales
price slid 4.4% and the median dipped 4.3% for the year. Most forecasters last year expected
local home sales prices to drop more than 5% as the market was still recovering from the Great
Recession as well as the first‐time homebuyers tax credit in 2009/2010.
Twelve months ago the majority of economists were predicting a double‐dip recession. In
real estate they were saying it was only going to get harder to get a mortgage and home values
were going to decline another 10% nationally. Somehow the American consumer began to
realize this to not be the case. The fact is, mortgage rates actually dipped and remain at
historically low levels and home values stabilized in most markets.
As 2012 begins, the local real estate market looks to be relatively healthy especially when
you consider how sick it has been over the past 4 years. There is reason for this optimism.
First and foremost is the number of homes which are currently under contract; 1081 which
is the highest we’ve seen in 5 years. Add to this the low inventory levels, affordable home
prices, historically low mortgage rates and the sinking number of foreclosures and the picture is
quite rosy.
Perhaps the most significant impact to the housing market and the economy as a whole has
nothing to do with these numbers. Rather it is the general feeling of measured optimism
amongst consumers that the worst is behind us. Our forecast for 2012 is it will be a good year, not great. We will continue to see measured improvement and in fact expect home values to increase 3‐5%. The housing market at $250k and below has been strong for 2 years and will continue to be. The higher price ranges will finally see some movement which will drive the average & median prices up. 2012 will be a year when people will again realize residential real estate is an excellent investment. Renters will realize they can actually buy a home for little or no down paymemt and their mortgage payment will be less than what they pay for rent. Current home owners will see they can move‐up and keep their current monthly payment or downsize with a 15 year mortgage and have a lower monthly payment. Investors will realize they won’t find a better return than real estate with current home values being so low, ridiculously low mortgage rates, high rental rates and the expectation of appreciation.
*
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment