Inventory Is Growing!! Is It A Good Time To Sell a Home … Is It A Good Time To Buy a Home?

Hi, ladies and gentlemen, this is Diane Cardano from Cardano Real Estate Experts here with the “Hot Off the Press” Real Estate Market Report through October 1st.

Let’s get right to it! Check out the video for fabulous graphs.

Let's start with the good news.

We are finally in a full housing recovery; there's no question about that anymore! Let me tell you why.  For a recovery to occur, three things need happen: sales need to increase from the bottom lows they were at, prices have to turn around, and inventory has to bounce back to a normalized level.

1. Sales

Let's take a look at the pending home sales beginning from January 2012 through July of this year.  Historical data shows us that with the exception of a sharp drop in April 2012, home sales have been in a healthy state of growth for more than a year.  Some of you may have heard the fear monger voices of the media telling you pending home sales are down in July and August.

That is true - to an extent, Are pending sales down from major peak? Yes. But look at where they are in regard to a historically healthy level; they're still well above that level.

2. Prices

In the beginning of 2013, inventory was limited because people didn't fully believe in a housing recovery; because of this hesitancy prices increased dramatically in the spring market.

As far as the recovery is concerned, sales have been up for nearly two years, prices have been up now for about 15-18 months, and since the beginning of the year inventory has increased.

This graph is important for two reasons: first it shows the rapid appreciation as the market recovered from the dramatic losses of the past. 

This is illustrated by the year over year gains on the first two thirds of the chart.

The second reason this graph is important is because it shows the last three months sitting at 12 percent. It is assumed that the market has found a steady level and will likely proceed at a much slower growth rate over the upcoming months.  We are seeing a slow in our market.

The rapid price appreciation is not going to continue; that's important for sellers to know!

If you read the Wall Street Journal, watch CNN or listen to NPR, you probably have heard that home prices have increased by 12%-13%. You might think, "Well, if I wait until next year to sell, I'll get another 12 or 13%." Not necessarily.

3. Inventory

In real estate, we look at inventory based upon the supply. If there's one to five months' supply of inventory, we know it's a sellers' market and appreciation is going to take place.

That's the market we've been in since June of last year, the amount of people looking to buy a house was greater than the amount of people that were putting their house on the market.

An equilibrium market has 5-6 months of inventory. This means an equal opportunity for both buyers and sellers.

Anything greater than a six-month supply indicates that there aren’t enough buyers looking for homes.

This graph only shows through July and it appears that we are at normal levels of inventory. Our graphs only show national stats.

Our inventory, though, is high, especially in the higher end market. Most areas in our market are back to a buyer's market.

Another way to demonstrate this is with a graph. This graph shows the year over inventory levels. Back in January, we were 24% off of last year. Every month since January, though, has decreased. The decrease reached a point where we were only 5 percent behind where we were last year. However, inventory has increased considerably in our area during the past two months.

This is the national market report for October. My experience is that our market here in Philadelphia has slowed down incredibly. The first time buyer’s price ranges have dropped 10 percent and hardly anyone is looking at homes over $500,000.

So if you are thinking of selling your home, you need expert advice to ensure you stage your home to perfection, have the best high tech marketing, get your home on thousands of websites and have it priced it to sell.

How can you do that? Just come to one of our Home Seller Seminars at the Abington library. Our last two seminars this year are on October 24th and November 21st.  Just go to www.HomeSharkSeminar.com to sign up!! Or email in for your free kit by going to www.HomeSellerToolKit.com

This is Diane Cardano from Cardano Real Estate Experts signing off on this month’s real estate marketing report.