What do September's (09) housing stats for Montgomery County, MD tell us?

I thought there would be a big increase in inventory after Labor Day since the supply of houses and condos in Montgomery County has been dropping for more than a year, but that didn't happen.  In fact, there were nine (yes, I said nine) more unsold houses (2276) in September compared to August (2267). There were 27 more condos on the market in September (932) than August (905).  As a reference, there were 4177 unsold single family homes at the end of September 2008 and 1200 condos.

September 2008 is when the public became aware of the problems in the financial market and when housing sales started to fall, so it's interesting to see what's happened in the past year. 

Inventory of single family houses was at its highest in April 2008 and remained fairly steady for two more months before beginning a free fall that bottomed out in August of 2009.  Contributing to that big drop is the number of contracts written in April, May, & June of this year, taking a lot of homes off the market.  Just over 1100 contracts were written for single family homes in each of those months.  The previous record for number of contracts written was in May of 2005 when around 1600 single family homes went under contract.  The highest number in 2008 was around 800 contracts written, also in May.

Settlements seem to be lagging behind the numbers for contracts.  I attribute that to the length of time it is taking to get responses from lenders on short sales and the increased restrictions from lenders for new mortgages.  It normally takes 45 to 60 days between the date a contract is accepted and when settlement occurs.  So for April contracts, we'd expect a high number of settlements in June.  There were 1103 contracts in April and 557 settlements that month.  In May, there were 680 settlements, and in June, 859.  The highest number of settlements for the year was in July - 905 single family houses went to closing. That dropped in 760 in August and 635 in September.  (My statistics, by the way, are from the Greater Capital Area Association of Realtors.)  New appraisal and lending rules went into effect this summer and that may have slowed down some of the settlements.

Our local multiple listing service, MRIS, reports that the average list price of all Montgomery County residential properties (condos & single family houses) was around $410,000 in 2008.  In 2009, that average is around $350,000.  Over the summer, properties were selling for about $5000 over than average.  In September, that averagle sales price dropped to $333,500 from $355,000 in August.  I take that to mean that a lot of bargain hunters bought properties over the summer leading to the higher number of sales, but lowering the average price.