Market Report: The heat continues in July!

Record highs usher in sizzling sales

By Kim Walker
Media Relations and Public Relations Specialist

 

July gave us some of the warmest days on record, and according to my colleagues, the area housing market was just as hot. Back in March, I was asked why the spring selling season had gotten off to such a strong start. I, like many Realtors®, credited Mother Nature and the lack of winter as a boost to spring sells. The string of 100-degree days we had in mid-July made me wonder if the heat would hamper sales. But CMLS’s July results showed otherwise.

Closings, prices up

Closings in July (2,653) increased 22.2 percent over the same period last year. The average and median sales price continued to trend up with the average sales price in July ($220,385) up 3.4 percent and the median ($166,100) up 1.6 percent. This is the sixth-consecutive month of year-over-year price gains. The average listing price ($237,904) decreased slightly (1.4 percent) compared to prices a year ago, bringing the percent of original list price received measure to 92.5 percent compared to 89.7 percent last July.

Contract activity slows

Pending contracts (1,738) fell in July and were down 15.3 percent compared to the same period a year ago. Still, contracts declining at this time of year is nothing new. In fact, it was the norm before the recession. Contract activity has been elevated for nearly a year now. A decline at this time of year is simply evidence of the market performing the way it always has: Contracts and closings usually peak in mid-summer and gradually decline as the selling season winds down.

Smaller inventory, quicker sales, fewer distressed properties

New residential listings in July 2012 totaled 3,930, an increase of 6.8 percent compared to the same period last year. Overall inventory for the CMLS region was down 16.9 percent, leaving the region with an 8.8-months’ supply of homes for sale as compared to a 12.5-months’ supply during the same time last year. Homes sold at a faster pace in July. The average number of days a property was on the market from the time it was listed until it closed (list to close) was 144, the lowest this figure has been since October 2008. This represents a decrease of 13 days compared to the list to close count of 157 days last year.

Foreclosures and short sales, or distressed sales, made up only 12 percent of all new listings. This figure was 15.8 percent last year. Nearly 14 percent of closed sales were distressed, which is down from 16.5 percent last July.

Signals for a turnaround?

For the first time since 2005, housing is on track for contributing positively to the national GDP.  This will occur either by way of direct residential investment, remodeling or other ancillary services. So what do we make of this fragile but perhaps real recovery? Certainly it’s a good time to buy or list your home. But more important, sustained recovery will not occur without real employment and wage growth. And a good dose of positive consumer confidence always helps. Remember: Not all submarkets will recover at the same pace; consult a Realtor® to find out how your neighborhood is doing.