The latest report just came out from the Pinellas Realtor Organization for residential sales in Pinellas County Florida and the data is very encouraging. The Absorption Rate for June, 09 was 11.1% up from 7.3% for June, 08. Also interesting is that 11.1% represents the highest absorption since Jone of 06. Great news right? I think so but before we send out invitations to a "The Market is Recovering Party" it is probably a good idea to point out that values are still on the decline. From June 08 though June 09 prices fell by 20.%. Make sure you grasp the fact here that even though the absorption improved by 52%, prices fell by 20%. So what does this mean. Good question and the answer depends on if you are buying or selling. In my opinion, here is what I think this means.
Selling: 1. 12 out of 100 homes are selling every 30 days. This works out to a 8.3 month supply of inventory which is still a buyers market but much better than the 20 month supply of inventory we had in January.
2. You have a much better chance of selling right now but only if you are realistic about the price strategy you take. It's not enough to be competitive, you must be compelling.
Buying: 1. There are still good deals to be had but we are no longer in a 20 month supply and the good homes are selling. As a matter of fact, I believe we are in a Sellers Market within A Buyers Market. What the heck does that mean? Simple, the nicest homes at the right price are selling very quickly, some within weeks or days.
2. As an agent representing a buyer, you will be doing them and yourself a favor if you will help them self-discover that the really nice homes are not selling for 80% of the asking price but closer to 95% and in some cases up to 99% or even 100% of the asking price. Who defines what a good deal is anyways. If I get a home at $50,000 below the asking price but it was $45,000 overpriced to start with, did I get a good deal?
I know what you are thinking, great news John but aren't most of theses sales Short Sales or Bank Owned Sales. Actually, the news here is encouraging as well. Don't you hate it when someone keeps raining on your pitty party with good news. :) The percentage of homes sold in June 09 that were distressed sales was 30%, down from 42% in January.
So, wrapping it up here for now, this is in no way an announcement from me that I think we have turned the corner or hit the bottom or whatever you want to call it. This is just a market update pulled from The Pinellas Realtor Organization and it is also just for Pinellas County Florida.
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