Here is the updated Layton market snapshot report for the most recent quarter. We are starting to distance ourselves from the frozen credit markets we experienced in the fourth quarter of 2008 and after the first of the year. However, the local real estate market is still a bit sluggish.
We are now starting to report more significant price point impacts as sellers are forced to adjust their pricing in order to obtain offers. As I mentioned in my fourth quarter report, the impact of elevated inventory levels and the increase in distressed properties (e.g. short sales, foreclosures) is being felt as these properties are now being sold and the price impacts being reported. The trend line continues to be downward and most analysis would indicate this trend will likely continue through at least the first half to three-quarters of 2009. The good news is we are continuing to see new inventory counts begin to decline thus slowing the pipeline of competing inventory. However, as you can see from the “Listing Inventory” section of the report, we continue to carry a high on-going inventory in all price categories.
It does appear the Fed’s ability to keep long-term interest rates moderated is helping to some extent. We are continuing to see sales activity, albeit reduced, in all price points. In fact, you might notice in the “Buyer Demand” section that average and median home sale prices in Layton increased slightly from the same period a year ago. This in spite of a 12% decrease in actual unit sale activity. This drop in unit sales is having an impact on average list prices. As the existing inventory begins to sell, I would expect the impact on average price points to be realized.
So have we hit bottom yet? That’s a question I get asked frequently and I have a standard response. “Perhaps, but we won’t really know until we can look back at one or two quarters and then definitively say ‘that was the bottom.’” I have yet to find someone who has the ability to accurately predict a bottom but a vast number of people who can report a bottom . This is just as true in the stock market as it is in the real estate market.
This spring and early summer season (May through July) will tell us a great deal about the market’s ability to reach a stabilization point. My next quarterly report will be prepared near the end of this time period and should provide an interesting view into our market’s dynamics. I hope you find this information helpful. You can also go to my website’s Communities tab and get additional market data reports for several communities in Davis County as well as global reports for both Davis and Salt Lake County
Of course, don’t hesitate to contact me with any questions you may have about this data or if there is more specific information I can provide relative to our current market conditions.
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