Another month rolls by and the housing market churns on like some disheveled cargo plane spluttering back to base with only one propeller working. Okay, that was a bit overly dramatic. But here are the numbers to back up the image.
First good news. The number of homes that sold in May was—as predicted in The Observer—up from the previous two months. A whopping 58 residential properties sold in Jefferson County in May.
However, while May 2007’s figure was up from the home sales in March (43) and April (46)—hooray!—this is still way below the sales of homes in May 2006 (85). Even so, the data for May do indicate a little bounce in the step of the market.
Now onto the bad news. If you are selling your home, it is still a long, slow slog. The average number of days for a home to sell in Jefferson County has steadily increased from January 2005 (52 days) to May 2007 (132 days). That is a massive increase for those who are trying to sell their home (see figure 1).
Moving from the plight of the unlucky sellers . . . what about those buying in the county? Are there really fewer transactions taking place or have our expectations been skewed by the crazy days of 2005?
If you look at May sales for the past few years, you could argue that May 2007 wasn’t such a bad month after all (see figure 2). Sure, May 2007 wasn’t nearly as good as 2006, and nowhere near as good as 2005. But it was fairly close to the five years running 2000–2004 levels.
To say it is a crashing market for buyers would be like a guy winning the lottery one year and saying he was surprised not to win it the following year—and the year after that. Ladies and gentlemen, the real estate market in 2005 and part of 2006 was a freak-fest. Today we are living in the land of the normal. Don’t be alarmed if we don’t hit all-time highs every year.
So if there are about the same number of people buying today as there have been for most of this decade, why all the fuss about a “slow market?” The reason, of course, is that there are far more houses for sale than ever before. There are over 740 residential homes for sale today. That is two to three times the numbers that were on the market in the years 2000–2004.
For sellers, therefore, it appears a slow market—as the average number of people buying do not make up for the well-above-average number of homes on the market. For buyers, it’s a turkey shoot. So stock up on pre-approval letters, and happy hunting.