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Location: Mars Hill, NC, United States

A small, highly personalized real estate firm specializing in mountain homes and land in greater Asheville.

Wednesday, April 15, 2009

February, 2009: Real Estate Market Data

The Quick Summary
Buyers and sellers should be wary about month to month comparisons that may show deceptive increases when reported in the media. The market is still quite bearish.

What we all want to really know, among other things, is how does one number or another compare with some meaningful time of normalcy, not last month.

Supply Indicators
New Homes Permits, Starts, and Completions, (PDF): Declined from one year ago by 44.2%, 47.2%, and 37.3% respectively. These numbers were all improved over January. Discerning buyers and sellers however should know that this is always the case, and the amount of increase was nothing to get excited about.

Moreover, the lion's share of the increase
came from multi family starts. This is not an index that points to a healthy housing market as we traditionally use that term. Instead, it represents an increasingly established shift from ownership to renting.

Single family starts, the most leading of indicators have now declined 42.3% from one year ago, and 77.1% from the peak in January, 2005.

New Home Inventories, expressed as months of supply remains at 12.2.

Existing Home Inventories: The months of supply remains elevated at 9.7 months. 6 months of supply would be a more healthy level historically. Additionally, the raw number of homes for sale rose for the first time since July, 2007.

Demand Indicators
New Home Sales, (PDF): Volume declined by 41.1% from one year ago. As always one must recall that this comes on top of large year over year declines in 2006, 2007, and 2008, in order to have an accurate picture.

New home sales now stand at 76% less than the peak in 2005, with more than a year's worth of inventory, just under record highs.

Existing Home Sales: Declined by 4.6% from one year ago. Foreclosures and distressed sales comprise 40% to 45% of the national market. As such, foreclosures artificially lower prices, and increase total market volume from what it would be, while inhibiting the ability of traditional sellers to compete.

As long as this persists, the market for existing homes cannot be deemed healthy or normal. Any sales "increases" will have to be treated with caution.

And In Greater Asheville
Existing home sales have declined from one year ago at around 6 times the national rate of 4.6%:
The number of existing homes sold last month in the Asheville area fell nearly 30 percent last month compared with February 2008 and the average home sale price also dropped...

February sales were down in other WNC counties where figures are reported to the state association, falling 51.0 percent in Haywood County over February 2008, 36.1 percent in Henderson and 27.8 percent in Transylvania.

Local home sales have trailed national sales in recent months. Existing home sales nationally for February were down 4.6 percent over February 2009 and up 5.1 percent from January to February on a seasonally adjusted basis. Local figures are not seasonally adjusted.
A number of times we have written about the mechanisms of the greater Asheville real estate market. Specifically that we depend on buyers from "feeder areas". If one cannot sell their home back home, then population growth and the real estate market here will reflect that.

Our feeder markets are at or near the heart of the real estate bubble. The Citizen Times recently weighed in on this point:
“It's the bursting of a ‘migration bubble,'” said William Frey, a demographer at the Brookings Institution think tank who analyzed the numbers. “Places that popped up in migration growth in the superheated housing markets earlier in the decade are now just as quickly losing their steam.

“It's the constraint of not being able to buy or sell a home that is keeping people from moving long distances,” he said.
Still time it seems for buyers and sellers to pick their spots in the market.

Thanks for stopping by,
Black Bear Realty Website
828 689 2055
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Filed Under: Real Estate Statistics and Data, Asheville Real Estate Data

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