Residential Market Analysis

I was poking around on Redfin over the weekend in an attempt to figure out which way the market is headed.  I must admit that the amount of information available to the public compared to 10 years ago is astounding.  Every time I access sites like Redfin, Trulia & Zillow it confirms my long held belief that Real Estate Agent commissions are headed the same directions as Travel Agent's & Stock Brokers...down.  However, I continue to be amazed at how slow in coming it has been for Real Estate Agents.

In the meantime, I spent some time sorting thru the data to see what insights were to be had.  To marrow my focus I chose North Bend as my microcosm.  Here are some observations.

I counted 64 homes currently listed for Sale.  The average listing prices was $402,000.  The average monthly sales for March & April were 10.5, leaving a 6 months supply of homes.  Not too bad.  The nationwide months supply is north of 8.  Of the 64 homes listed, 10 were listed as short sales.  7 of those homes are listed at least $70k below their purchase price.  Ouch!  4 of the short sales have been listed in the last 1.5 months.  5 of the short sales have seen price reductions since the beginning of the year, averaging about 10%.  The new short sale listings and aggressive price reductions on existing short sales would lead one to believe lenders are getting more serious about clearing out the deadwood.  While hard to ascertain, it would appear lenders are trying to be competitive with their pricing, but they aren't the loss leaders.

Since April 1st, 25 homes (39% of the listings) have had price reductions averaging 9%.  Half of those have been on the market over 200 days, so these listings are basically being marked to current market price after last Summer's price highs.  Unfortunately, these potential sellers are chasing the market down.

16 listings (25%) are priced over $50k below their purchase price.  The bulk of these, not surprisingly, were bought in 2006 & 2007.  That is some pretty serious negative equity.  Oddly, only 6 of these are listed as short sales.

In general, the market is acting as one would expect.  Sales are ticking up a bit during the selling season.  Months supply is reasonable.  There are distressed properties on the market, but it doesn't seem to driving the market down.  Of course, one month doesn't make a trend.  In order to determine the trend, I anticipate following North Bend closely thru the selling season to see the true state of the market.  In particular, I will be watching a specific neighborhood, Si View.  If is a fairly homogeneous neighborhood with similar sized lots and similar styled homes making price comparisons easier.  There are currently 9 homes listed for sale.  4 of these are leftovers from last Summer and have been marked down this Spring.  5 more homes have been recently listed at prices similar to the leftovers.  None of these are listed as short sales.  I'll be interested to see what strategies are employed to move these homes.  Stay tuned...

Here's Redfins listings.