Thursday, March 01, 2007

January Market Wrap

The Warren Group results for January (reported as yoy change):

SFH sales up 5.1%
SFH prices down 3.4%
Condo sales up 2.7%
Condo prices flat

MAR numbers were much stronger for January:
SFH sales up 12.6% yoy
SFH prices down 2.4%
Condo sales up 5.3%
Condo prices down 0.7%

Here are MAR reported median prices for SFHs and Condos relative to recent history:

In the January press release MAR no longer reports inventory broken down by SFH and condo, so I will omit those plots. The increase in sales, and decline in inventory from last January to this January led to a major decline in Months Inventory from 14.1 to 10.7 months:
Overall, these numbers reverse or halt many of the trends that have been consistent since the summer of 2005 (e.g. declining sales, increasing inventory). However, median prices continue to decline. The coming months will certainly be interesting. My sense from reading the MAR press release is that February numbers will be much weaker, likely due to the turn in the weather in January, and the surge in mortage rates that began in December (which should affect closings with a 2-3 month lag).


Rush said...
This comment has been removed by the author.
indigo said...

Can't wait for the Feb and March numbers to tell whether the trends are changing or not. I will concede that MAR managed this winter much better.

Anecdotally, I have noticed several agreements falling through in Jan and Feb and a flood of new listings Feb 28 and March 1+2. But I'll have to see if the stats bear that out.

More subjectively, beyond the subprime crisis, I would imagine the stock market jitters are not contributing tremendously to market confidence and I cannot see this ship turning around any time soon. If you add pending adjustable mortgage resets and foreclosure trends the ship is still on track for the whitewater on the reef ahead. But again I concede that supply matters.

My prediction is that the bottom can only come after the congressional hearings.

Mitesh said...

I have seen a lot of condos in the Brookline and Cambridge area pulled off the market and placed on Craigslist as a rental a week later.

My guess is that the true inventory is probably much higher than the numbers show. Many of the units pulled off the market for the winter will re-emerge in the Spring.

The owners who are renting their units while holding out for a better market will eventually end up placing their properties back on the market as well. My guess is that there will be excess inventory for some time.

Another interesting phenomenon - I have seen two properties which were taken off the market relisted in the last few weeks. Both were listed at a higher price than before!