Good Real Estate Volume For December 2010

The month of December, 2010 saw some improved volume numbers for Pinellas County real estate sales, but median prices continue to fall.

The absorption rate (AR), which is calculated by dividing the total number of units sold for the month by the total number of properties listed in the MLS, went up for both single family homes and condominiums.

The AR for single family homes during December moved up to 11.9% as compared to November's 8.3% figure. This means that there is an inventory backlog of single family homes sufficient for 8.4 months of selling activity.

The AR for condominiums stood at 9.4% for December as compared to 6.3% in November. So, we have an inventory backlog for condos at 10.6 months.

Single Family Home Sales Data

According to MLS data, there were 6,327 single family homes listed for sale in December. This is a decrease from November's inventory of 6,540. Some of this reduction in inventory is probably related to increased sales activity during the month. In December, 754 single family homes were sold in Pinellas -- one of the best figures in recent months. By comparison, only 542 were sold in November, an increase of 212 sales. Let's hope this trend continues!

The median price during December was $125,000 compared to $140,000 in December of 2009, a decrease of 10.7%.

Condominium Sales Data

Condos did well during December as well. There were 5,205 condos in the MLS in December as compared to 5,422 in November. Condo sales looked better as 489 condos were sold during December as compared to only 342 in November. Of course, this increase in sales can surely be attributed to the seasonal nature of condo sales in Pinellas County.

The median price of condos fell substantially compared to the same period last year. The December 2010 median price was $101,000 but in December of 2009 it was a much higher $124,900. That's a drop in median price of 19.1% year over year for condos.

If you were to chart prices on a monthly basis you would see that prices for 2010 were pretty flat for single family homes. The median price in January was $130,000; it moved up and down a little every month during the year but ended at $125,000. I'd say prices for single family homes were pretty flat this year taken as a whole. For condos, prices are still fluctuating. In January the median price for a condo in Pinellas County was $113,000 but in December it had fallen to $101,000. Maybe condo prices will start to stabilize a bit next year.

So, has the real estate market reached bottom? Well, I think not. Overall, the trends are still headed downward from a price viewpoint, but I think it's falling at a slower rate. On the upside, sales volume seems to be headed upward and that's a good thing. Also, we're seeing some improved employment numbers for the county and that's an important measure of future real estate activity.

Let's hope 2011 is better for everyone!

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The 4-P's Of Selling In Today's Market

There's no doubt about it. Selling today is a lot more complex than it was six to eight years ago. Sellers need to take a little different view of the process and practice what I like to call the 4-P's of successful selling.

1. Positive. Selling a home can be a stressful undertaking often complicated by life changing events. The best way to get through such a situation is to keep a positive mental outlook about the sale and the underlying reasons for the sale. In other words, if there is a silver lining to be found in the situation, find it and keep it uppermost in your mind throughout the selling process.

2. Pro-Active. This is just my view of things, but I believe sellers and their listing agents need to be pro-active in the marketing and sale of the property. You can't just put a sign in the yard, an ad in the newspaper, drop it in the local MLS and expect somebody to come along and buy the property. Sellers and agents need to actively market the property, they need to follow-up with agents and buyers after showings, and they need to negotiate every offer to find a win-win situation if one can be found. You can't do this sitting on the couch watching the afternoon soaps.

3. Patience. Listen to the evening news or read the daily newspaper. You will quickly learn that the country is in a deep and prolonged recession and the recovery is coming very slowly. Many people are unemployed or under-employed. Mortgages, once easily obtained, now appear to be much more difficult to secure. In this kind of economic environment, fewer people can qualify to buy a home. So, given this set of circumstances, sellers need to recognize that selling a property will likely take longer than it has in the past. This means that sellers will need to be more patient with the selling process and their agent's efforts on their behalf.

4. Price. Today's buyers are looking for bargains. Period. If your property does not carry a bargain price, it is unlikely that it will sell. If you really want to sell the property you have to price it at an appealing price for today's bargain-hunting buyers. Moreover, if the property has been on the market for more than 60 days (some would argue even less time) and you have not received an offer, that is the market talking to you. It is saying that they are not interested in your property at that price. So, you need to adjust your price downward until it becomes a bargain. In this effort, time is not on the seller's side. In an economy where real estate prices continue to fall, the longer the property remains on the market the less it will eventually sell for. Just keep that in mind when your agent suggests a price adjustment.

There you have it. Positive attitude. Pro-active undertakings. Patience. Price. As I see it, these are the 4-P's to success in today's market for sellers.

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