The inventory numbers are another fun set to look at. We hit a high of nearly 60,000 in late 2007 when the market seized up as prices fell, buyers vanished and lending dried up. The inventory started to fall once the government started all the bailout/workout BS. The low water mark for inventory was around the holidays last year. We have been creeping up ever since. Banks are starting to ramp up the foreclosures (more slowly than anticipated though). Short sales are now being encouraged by banks and that's also helping pump up the numbers. We are getting close to 32,000 but there is still a serious shortage of good properties. I'm seeing lots of overpriced listings and lots of trash. The pearls are few and far between.
For you history buffs, here's the data for the last few years.
| Month | SFH+Condo Inventory | 25th Percentile | Median | 75th Percentile |
|---|---|---|---|---|
| Jun 2010 | 31,100 | $150,750 | $242,450 | $422,500 |
| May 2010 | 30,478 | $150,600 | $240,960 | $420,180 |
| Apr 2010 | 29,844 | $149,950 | $237,975 | $412,450 |
| Mar 2010 | 27,466 | $149,910 | $235,000 | $399,978 |
| Feb 2010 | 25,888 | $147,675 | $230,975 | $398,225 |
| Jan 2010 | 25,155 | $147,450 | $229,225 | $397,500 |
| Dec 2009 | 25,435 | $149,225 | $232,125 | $403,737 |
| Nov 2009 | 26,575 | $149,920 | $238,400 | $420,010 |
| Oct 2009 | 27,569 | $149,175 | $236,250 | $423,450 |
| Sep 2009 | 27,493 | $149,925 | $239,500 | $435,988 |
| Aug 2009 | 28,410 | $148,882 | $237,880 | $431,400 |
| Jul 2009 | 29,257 | $147,313 | $235,225 | $429,250 |
| Jun 2009 | 30,584 | $144,980 | $229,760 | $414,790 |
| May 2009 | 32,614 | $143,725 | $225,000 | $401,973 |
| Apr 2009 | 35,365 | $140,000 | $219,850 | $387,500 |
| Mar 2009 | 38,625 | $139,960 | $217,080 | $369,580 |
| Feb 2009 | 40,003 | $143,125 | $219,148 | $364,750 |
| Jan 2009 | 41,594 | $148,976 | $222,615 | $364,140 |
| Dec 2008 | 43,995 | $155,997 | $228,843 | $371,270 |
| Nov 2008 | 45,466 | $162,791 | $234,869 | $378,171 |
| Oct 2008 | 47,030 | $169,812 | $241,097 | $385,301 |
| Sep 2008 | 48,794 | $179,945 | $253,064 | $396,132 |
| Aug 2008 | 48,928 | $189,183 | $264,707 | $410,471 |
| Jul 2008 | 50,281 | $198,565 | $274,909 | $423,742 |
| Jun 2008 | 50,874 | $209,673 | $291,266 | $445,107 |
| May 2008 | 51,306 | $220,983 | $308,857 | $455,220 |
| Apr 2008 | 52,578 | $237,943 | $319,005 | $475,726 |
| Mar 2008 | 53,200 | $252,057 | $336,952 | $493,538 |
| Feb 2008 | 53,347 | $265,768 | $352,536 | $507,636 |
| Jan 2008 | 53,971 | $277,607 | $366,177 | $518,359 |
| Dec 2007 | 55,808 | $289,994 | $374,137 | $534,693 |
| Nov 2007 | 58,257 | $301,146 | $387,907 | $546,581 |
| Oct 2007 | 57,873 | $312,784 | $398,326 | $561,045 |
| Sep 2007 | 59,183 | $317,841 | $407,566 | $564,659 |
| Aug 2007 | 56,879 | $328,547 | $415,993 | $578,136 |
| Jul 2007 | 56,592 | $337,269 | $423,300 | $592,323 |
| Jun 2007 | 55,370 | $341,823 | $426,332 | $601,018 |
| May 2007 | 53,371 | $347,533 | $434,838 | $609,832 |
| Apr 2007 | 51,233 | $350,796 | $440,705 | $615,759 |
| Mar 2007 | 46,932 | $354,807 | $444,272 | $620,370 |
| Feb 2007 | 44,865 | $355,285 | $444,140 | $620,370 |
| Jan 2007 | 41,962 | $355,100 | $444,712 | $620,370 |
| Dec 2006 | 44,794 | $358,810 | $445,173 | $620,370 |
| Nov 2006 | 47,124 | $359,605 | $445,463 | $621,387 |
| Oct 2006 | 48,067 | $360,038 | $449,609 | $621,387 |
| Sep 2006 | 47,561 | $363,553 | $450,500 | $621,457 |
| Aug 2006 | 46,408 | $365,700 | $453,627 | $625,172 |
| Jul 2006 | 44,460 | $369,940 | $456,393 | $636,981 |
| Jun 2006 | 41,618 | $370,894 | $460,939 | $643,759 |
| May 2006 | 38,227 | $370,894 | $461,100 | $649,048 |
| Apr 2006 | 35,332 | $370,576 | $461,100 | $652,575 |
Now do you think prices have bottomed? The inflation adjusted price chart from Schiller still puts prices the highest they've been in the last 130 years. Of course that chart does not factor in the size of the homes or any other changes to the home. It just takes the median price (adjusted for inflation). Since homes are probably at least twice the size and have many more features, you could certainly make the argument that they could be less expensive. I'd say the chart is useful for entertainment purposes only or possibly useful if used on a cross section of older homes. But using it across the board when in the last 10 to 20 years the size and extravagance of homes has gone way up isn't practical.
4 comments:
On you last point, while the size and extravagance of houses has gone up over the past few years relative to the previous 100 (and I might dispute that the move to indoor plumbing in the 20s might have been more 'extravagant'), has income gone up in step, particularly over the past 10 years?
FreedomCM
Prices have corrected from around $200/sf to around $100/sf (a little more in better neighborhoods, a little less in worse neighborhoods, and a lot less when you go out to east Egypt). Adjusting for inflation, which incomes have kept up with, these are about the same prices that existed throughout the 1980s and 1990s.
it's interesting to see the 75th percentile gravitate towards the jumbo loan limit of $417,000. Its got everything to do with availability and pricing of financing...
I doubt that's it. Anyone getting a $417k loan is buying a house around $500k because you just can't get a loan that size without at least 10% down. And anyone going in with less than 20% is being made to jump through hoops these days. Even if you get loan approval the MI underwriters are being incredibly picky these days. I'm hearing of lots of loans that can't get insured.
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