Thursday, February 23, 2012

Is a "seller's market" around the corner?

Home Supply Down 51% In 18 Months

According to the National Association of REALTORS®, Existing Home Sales rose to 4.57 million units last month on a seasonally-adjusted, annualized basis. This represents a 4 percent increase from December's revised figures and puts the benchmark figure at a 20-month high.

Not since May 2010 -- at the tail-end of the federal home buyer tax credit program -- have so many existing homes sold in a month. An "existing home" is a home that's been previously occupied and is not new construction.

Beyond the headline stats, though, there's a lot about which today's sellers should be excited -- beginning with the national home inventory.

With just 2.31 million homes for sale nationwide, the national housing stock is at a 5-year low and falling fast, down 21% from just a year ago. Furthermore, with low mortgage rates and an improving economy stoking U.S. buyers into action, at the current sales pace, the complete U.S. home inventory would be depleted just 6.1 months from now.
That's more than twice as fast as compared to July 2010.

Furthermore, analysts say a 6-month supply represents a market "in balance". Anything less is considered Bull Market territory and we're headed there shortly.

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