February Sales Improved
Ask most real estate agents and they'll tell you that they think there's more market activity today than there was last quarter. They are right, I'm sure of it. The thing is, we must not confuse market activity with sales activity. The simple fact is that while there appears to be more and more buyers moving about in the marketplace and looking at real estate, there has not been a corresponding increase in the number of sales.
February sales figures prove it.
We will begin, as always, with the Absorption Rate. For those who don't know, the Absorption Rate is actually the inventory turn. It is determined by dividing the number of units sold during the month by the total number of listings in the MLS system.
For February, the Absorption Rate for single family homes was 5.4%. This represents an increase over January's Absorption Rate of 4.2%, but it is really nothing to write home about. By comparison, the Absorption Rate for February 2006 was 12.2% and for February 2005 it was 34.3%. Ah, the good ol' days!
The Absorption Rate for condos was still dismal. It was only 3.5% as compared to 2.8% for January. In February 2006 the Rate was 8.8% and in February 2005 it was 34.5%. Condos just keep taking it on the chin and I don't see an end in sight for them.
If you're a seller, man-o-man-o-man do you have competition. In Pinellas County in February residential listings in the MLS reached a total of 18,242 properties. If you drive through virtually any neighborhood you can read real estate signs as if they were outdoor billboards along the highway back in the 1970's. Sign after sign after sign after ... well, you get the idea.
Out of all those listed properties, only 848 of them were sold in February. That figure is, however, an increase over January's total sales figure of only 644 sales. Still, 848 is pretty sorry. Let's break down the sales and see what sold.
Single Family Homes
Of the 11,003 single family homes in the MLS at the end of February, 594 units sold. Of the sold units, about one-third of them were priced from $200,000 to $400,000. The median sales price stood at $196,000 at the end of February for a single family home in Pinellas County, down from the median price of $207,500 at the end of January, so it might be that prices are getting lower.
By the way, the MLS system is also reporting that 29.12% of the single family homes in the MLS have been on the market in excess of 120 days -- that's a lot of inventory with a long time on market, and that probably means a lot of frustrated sellers who might be willing to negotiate a great deal just to get out from under the payments.
Condos
Of the 7,239 condos in the MLS at the end of February, 254 sold. The median price for condos stood at $185,000 which is down from the $200,000 median in January of this year. I'll be honest about median prices with condos, they bounce around like crazy. Last fall the median was in the $150,000's, then they moved up, now they're moving down. I think the reason is because there are so few sales that if a few high dollar condos get sold the numbers go up and vice versa. I don't think I'd read too much into condo median prices. The thing that is important to note is how weak the condo market is right now. And still the developers build more of them. Go figure.
By the way, the price range that seems to sell the best is condos in the $250,000 to $400,000 range, with another bump in sales in the $120,000 to $139,000 range. Those high dollar luxury units seem to be sitting unsold with condos priced at $900,000 or more representing only about 3.5% of the total February sales, but accounting for over 10% of the condo inventory. So, if you are selling high dollar condos, better be real patient. Overall, condo sales are down 48.6% from where they were a year ago.
My Take On The Matter
So what does all this mean? The first thing that comes to my mind is that this must be about the best time in several years to be a buyer. Think about it ... loads of inventory ... frustrated sellers ... falling median prices ... stable and low mortgage rates ... a great negotiating postion. Man, if I wanted to buy property I can't hardly think of a better time than now -- especially if I was buying for the long term.
For sellers, maybe the picuture isn't quite so bright. It's clearly a buyer's market so you need to act prudently. Reduce the asking price ... consider every offer as serious ... be ready to negotiate ... make sure you're doing a lot of marketing to attract the buyers who are out there ... be patient. If you're smart you can still find a buyer willing to pay a handsome price for your property, you just have to put forward more effort and more time.
Well, that's it for this month's report. By the way, if you'd like more info on real estate in Pinellas County be sure to see my newly updated website at www.TheStPeteRealEstateSite.com.
February sales figures prove it.
We will begin, as always, with the Absorption Rate. For those who don't know, the Absorption Rate is actually the inventory turn. It is determined by dividing the number of units sold during the month by the total number of listings in the MLS system.
For February, the Absorption Rate for single family homes was 5.4%. This represents an increase over January's Absorption Rate of 4.2%, but it is really nothing to write home about. By comparison, the Absorption Rate for February 2006 was 12.2% and for February 2005 it was 34.3%. Ah, the good ol' days!
The Absorption Rate for condos was still dismal. It was only 3.5% as compared to 2.8% for January. In February 2006 the Rate was 8.8% and in February 2005 it was 34.5%. Condos just keep taking it on the chin and I don't see an end in sight for them.
If you're a seller, man-o-man-o-man do you have competition. In Pinellas County in February residential listings in the MLS reached a total of 18,242 properties. If you drive through virtually any neighborhood you can read real estate signs as if they were outdoor billboards along the highway back in the 1970's. Sign after sign after sign after ... well, you get the idea.
Out of all those listed properties, only 848 of them were sold in February. That figure is, however, an increase over January's total sales figure of only 644 sales. Still, 848 is pretty sorry. Let's break down the sales and see what sold.
Single Family Homes
Of the 11,003 single family homes in the MLS at the end of February, 594 units sold. Of the sold units, about one-third of them were priced from $200,000 to $400,000. The median sales price stood at $196,000 at the end of February for a single family home in Pinellas County, down from the median price of $207,500 at the end of January, so it might be that prices are getting lower.
By the way, the MLS system is also reporting that 29.12% of the single family homes in the MLS have been on the market in excess of 120 days -- that's a lot of inventory with a long time on market, and that probably means a lot of frustrated sellers who might be willing to negotiate a great deal just to get out from under the payments.
Condos
Of the 7,239 condos in the MLS at the end of February, 254 sold. The median price for condos stood at $185,000 which is down from the $200,000 median in January of this year. I'll be honest about median prices with condos, they bounce around like crazy. Last fall the median was in the $150,000's, then they moved up, now they're moving down. I think the reason is because there are so few sales that if a few high dollar condos get sold the numbers go up and vice versa. I don't think I'd read too much into condo median prices. The thing that is important to note is how weak the condo market is right now. And still the developers build more of them. Go figure.
By the way, the price range that seems to sell the best is condos in the $250,000 to $400,000 range, with another bump in sales in the $120,000 to $139,000 range. Those high dollar luxury units seem to be sitting unsold with condos priced at $900,000 or more representing only about 3.5% of the total February sales, but accounting for over 10% of the condo inventory. So, if you are selling high dollar condos, better be real patient. Overall, condo sales are down 48.6% from where they were a year ago.
My Take On The Matter
So what does all this mean? The first thing that comes to my mind is that this must be about the best time in several years to be a buyer. Think about it ... loads of inventory ... frustrated sellers ... falling median prices ... stable and low mortgage rates ... a great negotiating postion. Man, if I wanted to buy property I can't hardly think of a better time than now -- especially if I was buying for the long term.
For sellers, maybe the picuture isn't quite so bright. It's clearly a buyer's market so you need to act prudently. Reduce the asking price ... consider every offer as serious ... be ready to negotiate ... make sure you're doing a lot of marketing to attract the buyers who are out there ... be patient. If you're smart you can still find a buyer willing to pay a handsome price for your property, you just have to put forward more effort and more time.
Well, that's it for this month's report. By the way, if you'd like more info on real estate in Pinellas County be sure to see my newly updated website at www.TheStPeteRealEstateSite.com.
-30-
posted by Terry Ward at 1:53 PM
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