Well with just a few weeks left before the end of the year, here is my real estate Inventory Summary for Farmington through the end of November. There are a couple of interesting data elements that, eleven months into the year, may surprise some who haven’t followed the market throughout the year.
Of note is the fact that listing activity is up over 30% from the year before and will likely end the year well above 2009 levels. With all the talk about "shadow inventory" levels and the down market, the data suggesta sellers were willing to put their homes on the market this past year.
Also, a bit surprising for most casual observers is the fact unit sales activity is up over 22% from last year. Much of the increase in unit sales occurred in the first trimester of the year when the home buyer tax credit was in effect. Even though market activity slowed after the tax credit expired, activity still tracked well with the previous year holding on to much of the unit sale gains posted in those first four months.
The increase in unit sales, however, did not prevent average and median home sales prices in Farmington (or Davis County for that matter) from falling for the third straight year. However, the decline in sale prices was a modest 3-4%. Since the market peak in terms of median sale prices (which occurred in the second quarter of 2007), there has been an 18% drop in median sale prices in Farmington. For Davis County as a whole the drop over the same time frame is approximately 10%. Farmington has been hit a bit more due to two factors: one, an overall higher priced housing inventory and two, a large increase in lower priced condominium and townhome sales in the past three years. Year to date, two thirds of unit sales occurred below $300,000 in Farmington. For reference, in 2007 only half of the sales occurred at price points below $300,000.
Overall inventory levels continue to remain somewhat high (especially at this time of year), however, we are seeing some months inventory levels at or near six months which historically is considered a balanced market. This could be contributing factor to the stabilization of the median and average sale prices over the past several months.
There is good news in the data for both buyers and sellers. For buyers, inventory levels remain good (lots of options) and price points remain much more affordable than just three years ago (and let’s not forget interest rates at 50 year lows). For sellers, homes are selling, in fact at a much better rate than just a year ago and sale prices are stabilizing with inventory levels improving slightly (and historically low interest rates are good for you as well as more buyers can qualify to purchase your home).
I don’t expect to see any significant changes to the data once we get the December figures as historically there isn’t enough activity in either November or December to create massive changes in the overall data for the year. I will have a year-end review completed by the end of January (as I allow about three weeks after the year-end for all of the year end transaction data to get processed).
If you have any questions, don’t hesitate to contact me.
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