11.2 MONTH BACKLOG OF HOMES. DOES IT MATTER?

Doom and gloom statistics are all the rage.  They are the perfect accessory item.  But I agree with you... homes that are ready to be sold (e.g. staged, cleaned up and priced right FROM THE START and not "chasing the market") will still sell in a reasonable timeframe.

Numbers are never explained as then the talker or anouncer would have to know much more about the market. However unrealistic sellers remain. 

Hi Ken, Good Realtors know it's all about pricing.

All the best!

Statistics can be twisted to make any point the writer wants. 11.2 could easy be argued to 12.9, etc. What the statistician does not know is the exact absorption rate and the number of new listings that will come to the market.

I agree that homes will move, regardless of market conditions, if the price is right and is (as Steve Shatsky said) "staged, cleaned up," etc.  However, the large inventory numbers definitely matter because it leaves the seller little room for error.

We're currently working on residential rehab projects in the Phoenix, AZ metro area, buying well below market value homes from the public Trustee auctions.  Because of the large inventory levels, comps are tougher to obtain because pricing is all over the board.  Additionally, because of the inventory levels, banks are indiscriminately beginning to slash and dash prices to be the lowest price on the block to move their inventory.  Again, as a result, the comps can quickly deteriorate 10 plus percent in a matter of months.

Granted, because of the short duration of our projects, we're working with some different dynamics and variables but, regardless, sellers need to stay in tune with the market because they may find themselves quickly in a situation where they need to spend additional financial resources to update the property and drop the price to remain competitive.

In a market with scarce inventory, sellers don't often need to take drastic measures to move a property as buyers are willing to settle on the product in return for the location.  Now, people have the inventory to leverage pricing to demand a top notch home in a strong neighborhood.  If you, as the seller, can't give the buyer what they want they'll keep moving to the next desperate seller willing to do whatever it takes or perhaps having the means to meet the buyers demands.