http://www.bloomberg.com/apps/news?pid=20670001&refer=home&sid=aM0QF6wHRPoI
Well - at least it rained yesterday. In North Georgia these days, it is a good day when it rains.
That is why I was interested to read the article at the link above. In the midst of the current real estate drought, there is a little rain. Is it enough to signal a pending climactic change?
Pending home sales were up 7.4 percent from July to August this year and are up 8.8 percent from August 2007. In my last note, I talked about market capitulation. We are seeing that now in the stock market. I hope that we are seeing that in the resale market. The reason that I think we are there is because the percentage of REO and short sales as part of the total number seems to be increasing. Banks and other holders of REO properties and non-performing mortgages are finally realizing that they need to get these assets off their books. Seems like they might actually return your phone calls now!
Resale inventory also fell to 10.4 months from 10.9 months in July. If you just look at how many months it would take to get to a "normal" level of 6 months of resale inventory, then you can target next spring at the current rate of decline . . .
Buyers are also less afraid to catch a falling knife. Maybe it is just the ‘conspiracy theorist" in me, but I hope that things are leveling out (this would be your good conspiracy as opposed to your Dr. Evil conspiracy). Pending resales by region indicate that in the South, pending sales increased 2.3 percent from July to August.
Keep at it - and send closings! I hope to see you soon.
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