Alan Greenspan on the Housing Market – I Don’t Agree
Yesterday I was riding the bike at Gold’s Gym in Destin FL. One of my sellers, whom I originally met there, popped onto the bike next to me. He said, “Alan Greenspan says the housing market will recover by mid-2009, what do you think?” Greenspan pointed out that there has been a “slower rate of decline” in U.S. housing prices of late. I thought I had noticed the same thing in my Emerald Coast real estate market, here in Northwest Florida. Until the last 30 days, that is. During that time, I think prices have been declining even more steeply. I have been reducing my listing prices by several thousands of dollars, way beyond the norm. Certainly, I have seen some of my listings sell, but far too many have not attracted offers. Based on my intense examination and intuition regarding pricing, it is surprising, if not stunning. My observations are anecdotal, but here are statistics from the Emerald Coast Association of Realtors.
| Sales and Inventory Report | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Category – Combined Residential Statistics for Entire MLS from 11/1/2007 – 10/31/2008 |
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| Month | Year | Monthly Sales |
Avg List $ | Avg Sale $ | Avg $/Sqft | Median Sold $ | Avg DOM | % Sold/List | Current Inventory |
Months Inventory |
| November | 2007 | 416 | $366,350 | $337,422 | $190 | $225,000 | 210 | 92.10% | 12928 | 31.07 |
| December | 2007 | 438 | $357,465 | $332,160 | $206 | $240,042 | 240 | 92.92% | 12681 | 28.95 |
| January | 2008 | 385 | $378,386 | $357,163 | $224 | $250,000 | 228 | 94.39% | 11863 | 30.81 |
| February | 2008 | 505 | $374,582 | $351,138 | $233 | $259,900 | 208 | 93.74% | 11723 | 23.21 |
| March | 2008 | 536 | $379,554 | $359,452 | $229 | $245,000 | 199 | 94.70% | 11686 | 21.80 |
| April | 2008 | 461 | $400,340 | $362,789 | $199 | $236,000 | 199 | 90.62% | 11509 | 24.96 |
| May | 2008 | 489 | $409,191 | $374,629 | $197 | $249,700 | 188 | 91.55% | 11436 | 23.38 |
| June | 2008 | 497 | $407,679 | $374,634 | $196 | $229,000 | 178 | 91.89% | 11253 | 22.64 |
| July | 2008 | 453 | $348,534 | $320,267 | $169 | $225,000 | 167 | 91.88% | 10881 | 24.01 |
| August | 2008 | 412 | $356,089 | $324,816 | $166 | $220,000 | 181 | 91.21% | 10574 | 25.66 |
| September | 2008 | 379 | $321,708 | $294,281 | $158 | $199,000 | 186 | 91.47% | 10331 | 27.25 |
| October | 2008 | 75 | $479,805 | $427,512 | $205 | $215,000 | 218 | 89.10% | 9960 | 132.80 |
| Annual: | 5046 | $375,947 | $347,302 | $199 | $233,900 | 198 | 92.38% | 11402 | 27.11 | |
| Annual: | 2007 – 2008 | 5046 | $375,947 | $347,302 | $199 | $233,900 | 198 | 92.38% | 11402 | 27.11 |
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Note: The “Current Inventory” column(s) reflect the number of active(on market) listings on the 15th day of each month. |
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Note how the “Months Inventory” statistic has climbed again in September, when it had been gently teetering between 23-25 months since February 2008. Now it’s at its highest level, 27 months, since then. I have to attribute it to the tightening credit market.
