October Sales Report: Kinda Flat
The sales figures from the Pinellas Realtor Organization for October came in a few days ago. There's nothing in them to get very excited about, so I didn't rush to the computer and write up the month's results. I had a few minutes this morning so I decided to jot them down for everybody.
October, to be frank, was kinda flat.
If you look at the Absorption Rate (AR) for Pinellas County, single family homes for October were down from September by 2/10's of a percentage point. The AR for October stood at 11.3%, but it was only at 11.5% in September, so that's a pretty meaningless difference.
By comparison, the condo AR took it on the chin. The condo AR for September stood at 7.8%, but it took a full percentage point drop in October to 6.8%. That's a pretty significant drop in a thirty day period and I think it shows some real and continuing weakness in the condominium market.
Single Family Homes
The number of single family homes listed in the MLS for October was 6,373. Showing how flat the market is, the number of listings for September was 6,382. It seems to me like this inventory is staying at about the same number month-in and month-out. The industry sells a few houses and a few more come onto the market, but we're not really putting a big dent in that inventory figure as a result of sales activity. We're probably just replacing the normal inventory turn with some new properties.
Fewer single family homes sold in October than in September, but not by much. In October, 718 houses were sold; in September, sales were 735. That's not a significant difference in raw numbers and it's probably why the inventory is remaining about the same.
Even the median price for single family homes stayed about the same year-over-year. The median price for October, 2009 was $146,300; the median for October, 2008 was $150,000. That's a drop in the median of only 2.5% and it means that buyers are making purchases in about the same price ranges and in about the same percentages within those price ranges. (Remember, median price is not the average price -- those are two different measurements.)
Condo Sales
I guess condos are going nowhere. Well, maybe the condo market is getting a bit weaker if anything.
Consider this data: For October, there were 5,619 condos listed for sale in the MLS in Pinellas County. In September, there were 5,620. A net loss of 1 unit. Yeah, that's putting a dent in the inventory!
Condo sales for October were 381 units sold. In September, there were 436 units sold. September was not a great month for condo sales, but October seems to be significantly worse, and that's why the AR dropped a full percentage point.
Condo prices are going the same way as condo sales: downward. In October of 2008 the median price for a condo in Pinellas County was $137,000. In October of 2009, the median dropped all the way down to $113,000. That's a year-over-year drop in median price of 17.5% for the condo market in Pinellas County.
So, what does all this mean?
Well, it could very well mean that the drop in prices for single family homes is slowing and you can probably say that it is now pretty flat from a value standpoint. I don't like to use the term "bottomed-out" because how long the single family market will remain flat is anyone's guess. There are a lot of market factors that could influence single family home values -- employment (which influences demand), foreclosures and short sales, mortgage rates and the availability of mortgage funds, the general economy and lots of other factors. We could see another downward spiral of pricing in 2010, and some guru's have even made predictions like that recently. For right now, however, I think single family home prices seem to be holding steady.
For Pinellas condos, I think the outlook is pretty grim. Values continue to fall and most real estate agents I know report a general lack of demand for condos except for some newer luxury communities in locations along the Gulf beaches and the downtown section of St. Petersburg. Moderately priced condos that were once so popular among retirees seem to be suffering due to a combination of factors including competition from other cities for retirement, high maintenance fees, age of the communities (many built in the 1960's), restrictive by-laws and other factors that tend to steer potential buyers out of condos and back into single family homes or other kinds of living arrangements.
We also have to recognize that St. Petersburg and Pinellas County is no longer the retirement center it once was, having lost much of that market to south Florida (Miami/Dade County) and new communities like Trinity and other places in the north-central part of Florida. And frankly, a lot of baby-boomers are choosing not to retire to Florida in favor of Arizona, New Mexico, or southern California. Other boomers are being forced to retire up north simply because they can't afford to retire to a new locale. Loss of pension plans and restrictions on other kinds of retirement income may not permit relocation to a sunbelt area for those "golden years". So, condo demand is suffering in Pinellas.
So, here's the short story. It's still a strong buyer's market and these buyers are value-oriented. If the property (condo or single family home) is not value-priced, it probably won't sell. Seller's need to analyze their motives in selling. If they really want to sell the property, the price needs to be at low market levels. Sellers who are waiting for the market to "turn" or for someone to offer "their number" may really be waiting for that proverbial snow storm in hell.
Good luck and happy selling!
October, to be frank, was kinda flat.
If you look at the Absorption Rate (AR) for Pinellas County, single family homes for October were down from September by 2/10's of a percentage point. The AR for October stood at 11.3%, but it was only at 11.5% in September, so that's a pretty meaningless difference.
By comparison, the condo AR took it on the chin. The condo AR for September stood at 7.8%, but it took a full percentage point drop in October to 6.8%. That's a pretty significant drop in a thirty day period and I think it shows some real and continuing weakness in the condominium market.
Single Family Homes
The number of single family homes listed in the MLS for October was 6,373. Showing how flat the market is, the number of listings for September was 6,382. It seems to me like this inventory is staying at about the same number month-in and month-out. The industry sells a few houses and a few more come onto the market, but we're not really putting a big dent in that inventory figure as a result of sales activity. We're probably just replacing the normal inventory turn with some new properties.
Fewer single family homes sold in October than in September, but not by much. In October, 718 houses were sold; in September, sales were 735. That's not a significant difference in raw numbers and it's probably why the inventory is remaining about the same.
Even the median price for single family homes stayed about the same year-over-year. The median price for October, 2009 was $146,300; the median for October, 2008 was $150,000. That's a drop in the median of only 2.5% and it means that buyers are making purchases in about the same price ranges and in about the same percentages within those price ranges. (Remember, median price is not the average price -- those are two different measurements.)
Condo Sales
I guess condos are going nowhere. Well, maybe the condo market is getting a bit weaker if anything.
Consider this data: For October, there were 5,619 condos listed for sale in the MLS in Pinellas County. In September, there were 5,620. A net loss of 1 unit. Yeah, that's putting a dent in the inventory!
Condo sales for October were 381 units sold. In September, there were 436 units sold. September was not a great month for condo sales, but October seems to be significantly worse, and that's why the AR dropped a full percentage point.
Condo prices are going the same way as condo sales: downward. In October of 2008 the median price for a condo in Pinellas County was $137,000. In October of 2009, the median dropped all the way down to $113,000. That's a year-over-year drop in median price of 17.5% for the condo market in Pinellas County.
So, what does all this mean?
Well, it could very well mean that the drop in prices for single family homes is slowing and you can probably say that it is now pretty flat from a value standpoint. I don't like to use the term "bottomed-out" because how long the single family market will remain flat is anyone's guess. There are a lot of market factors that could influence single family home values -- employment (which influences demand), foreclosures and short sales, mortgage rates and the availability of mortgage funds, the general economy and lots of other factors. We could see another downward spiral of pricing in 2010, and some guru's have even made predictions like that recently. For right now, however, I think single family home prices seem to be holding steady.
For Pinellas condos, I think the outlook is pretty grim. Values continue to fall and most real estate agents I know report a general lack of demand for condos except for some newer luxury communities in locations along the Gulf beaches and the downtown section of St. Petersburg. Moderately priced condos that were once so popular among retirees seem to be suffering due to a combination of factors including competition from other cities for retirement, high maintenance fees, age of the communities (many built in the 1960's), restrictive by-laws and other factors that tend to steer potential buyers out of condos and back into single family homes or other kinds of living arrangements.
We also have to recognize that St. Petersburg and Pinellas County is no longer the retirement center it once was, having lost much of that market to south Florida (Miami/Dade County) and new communities like Trinity and other places in the north-central part of Florida. And frankly, a lot of baby-boomers are choosing not to retire to Florida in favor of Arizona, New Mexico, or southern California. Other boomers are being forced to retire up north simply because they can't afford to retire to a new locale. Loss of pension plans and restrictions on other kinds of retirement income may not permit relocation to a sunbelt area for those "golden years". So, condo demand is suffering in Pinellas.
So, here's the short story. It's still a strong buyer's market and these buyers are value-oriented. If the property (condo or single family home) is not value-priced, it probably won't sell. Seller's need to analyze their motives in selling. If they really want to sell the property, the price needs to be at low market levels. Sellers who are waiting for the market to "turn" or for someone to offer "their number" may really be waiting for that proverbial snow storm in hell.
Good luck and happy selling!
-30-
posted by Terry Ward at 4:49 AM
1 Comments:
We are seeing a very similar market here in Nashville. The good news is that the bad news has leveled to the point where no bad news seems like good news!
Are the condos on the river doing better than the condos that are in-land?
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