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The Other Shoe May Already be in the Air

By John Mulkey

Services for Real Estate Pros with TheHousingGuru.com

July 31, 2010 08:10 AM

graph of housing inventory Those hoping for a housing recovery may have to wait a bit longer as the latest numbers seem to indicate the potential for further drops in prices. This is especially troubling for sellers and somewhat disheartening for those who may have recently purchased.

With the inventory of existing homes increasing, and expected to rise significantly once the sales numbers for July are released, the increased competition will place additional downward pressure on prices. Should inventory numbers again rise to double digits, which some are predicting, the recent “spring surge” will soon be seen as an anomaly, not a recovery.

The graph from Calculated Risk Blog shows how the supply of existing homes has been growing in the past few months.

For additional information see: Calculated Risk Blog

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Lina Robertson

AMAX Real Estate - Springfield, MO

REALTOR® Serving Springfield, Nixa and Ozark, MO

John - I hate to say it, but I think you're right. I'm seeing it here in our area, and we are usually insulated from the worst of things.

Jul 31, 2010 08:12 AM

Marcy Moyer

eXp Realty of California Silicon Valley Probate, Trust, and Investment Sales - Mountain View, CA

Probate, Trust, and Investment Specialist

I have been tracking the Palo Alto Ca inventory for 2 years. The inventory of active listings was at it's peak in Feb of 2009 with 150 homes for sale, was down to 60 in Feb of 2010, 80 in May of 2010, and now holding at 100. Not as bad as in the worst times, but up significantly from early this year.

Jul 31, 2010 08:14 AM

John Mulkey

TheHousingGuru.com - Waleska, GA

Housing Guru

Lina - While we would all like to see the housing crisis over and forgotten; it's not that easy this time. We still have some pain to endure.

Marcy - Many areas are experiencing the same increases in inventory, and a surge is anticipated in the next couple of months.

Jul 31, 2010 08:19 AM

Rick Sterling

Pointe East Realty - Virginia Beach, VA

Coastal Virginia Homes for Sale

There are markets where things are improving .... but I think this is one of those markets every where, in which one has to follow it on a weekly if not daily basis to see which end is up at the moment. It certainly is not steady state! And not the time to casually watch it on a semi or yearly basis .... knowledge is power.

Jul 31, 2010 08:20 AM

Ed Silva, 203-206-0754

Mapleridge Realty, CT 203-206-0754 - Waterbury, CT

Central CT Real Estate Broker Serving all equally

John, the spring/summer surge was nothing more than a bunch of first time buyerstaking advantage of the tax credit. A lot of them are waiting for the program to start up again, which is highly unlikely. We are going to be stale for a bit longer.

Jul 31, 2010 08:22 AM

Rick - Exactly! We must all be aware of our local conditions. While the overall market has an impact, the local market is the one in which we operate; and it can vary widely from other areas.

Jul 31, 2010 08:23 AM

Charles Buell

Charles Buell Inspections Inc. - Seattle, WA

Seattle Home Inspector

John, like they taught us in the 50's in grade school. Crawl under your desk and put your head between your knees. Probably about as much help as it would have been for the atomic bomb.

Jul 31, 2010 08:24 AM

Charles - I thought I was the only one remaining who attended grade school in the 50's.

Jul 31, 2010 08:25 AM

Lyn Sims

Schaumburg, IL

Real Estate Broker Retired

Haven't seen it yet but sales are not keeping up with the listings which will eventually mean exactly what you say. Over saturated for most markets including mine in the Chicago suburbs. Keep that info coming.

Jul 31, 2010 10:07 AM

Hi Lyn - It is interesting to see how the markets differ around the country. Certain areas of CA and the NE are doing fine, while others, such as Atlanta remain depressed.

Jul 31, 2010 10:29 AM

Terry Chenier

Homelife Glenayre Realty - Mission, BC

John,

I recently predicted 3 million more homes coming on line.

Jul 31, 2010 05:30 PM

Pamela Seley

West Coast Realty Division - Murrieta, CA

Residential Real Estate Agent serving SW RivCo CA

John, my market, SW Riverside County, CA, is going to be deluged with inventory. There's buyers, but there's some issues -- high delinquency rates in condo and PUD complexes. Cash will be king here, except investors are savvy enough to know they're going to wait until next year to buy, when prices will be lower.

Jul 31, 2010 06:30 PM

Terry - And your prediction could be low!

Pamela - And those who wait may find some great deals.

Aug 01, 2010 04:46 AM

Michael J. Perry

KW Elite - Lancaster, PA

Lancaster, PA Relo Specialist

We are still chasing the market almost two years later !!!!!!!!!!!!!!!!!!!!!!

Aug 01, 2010 12:33 PM

Michael - And it's out there somewhere . . . .

Aug 01, 2010 02:15 PM

The Other Shoe May Already be in the Air

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