Sunday, November 08, 2009
Have you ever noticed that estimates of time are almost always optimistic? "Your car will be ready at 1. The doctor will see you at 10. I'll meet you at 12. We'll have an answer on your loan on the 3rd. The game will start at 8." The universe conspires to delay everything. At any rate, I have adjusted my behavior to accommodate this universal leakage of time. I expect everything to be late. Life has become less frustrating.
"All estimates of time are overly optimistic. Adjust accordingly."___Larry
This recent major uptick in monthly year-over-year condo sales got me to thinking about whether or not we are getting a signal of a trend shift. Year over year monthly numbers are the best metric available to me by which to measure the sales trend. The first half decade of the new millennium saw closed condo sales on a steady year over year increase until 2005 when the number of months that showed an increase were equal to the number of months that showed a decrease. Even though the numbers for the last half of that year were abysmal by comparison, 2005 exceeded 2004 in total sales by 1%. The boom years were over although most did not recognize the signals or did not want to believe them. By the end of 2006 it was apparent to all but NAR that a major decline was happening. We had not a single month in 2006 with higher monthly year-over-year numbers. The total number of condo sales for the year of 2006 was 38% below 2005.
The trend continued in 2007 with eight months showing lower year over year numbers with total year over year sales down another 21%. We began 2008 with the same hopes of a "spring selling season" that many were clinging to the two previous years. It was not to be and 2008 saw nine months with lower year over year numbers and the total sales for the year declined another 6%, thankfully a slower pace of decline.
We began 2009 with sales at the slowest pace of the last five years and clocked five sequential month over month declines until the trend shifted in June. Since June we have substantially beaten last years numbers every month but one with the last two months seeing blow-away comparisons. Even though this year's total sales will still be less than 50% of the peak year, 2005, there is evidence to support optimism. Buyers taking advantage of the first-time home buyer credit almost certainly contributed to the recent bump in the numbers. The extension and modification of the credit through next June will likely continue to add more to the sales through that time. Draw your own conclusions, retain some skepticism but be aware that the market is active with substantial numbers of buyers cherry picking the inventory. While inventory is still heavy in the over-priced, new luxury condo segment, finding a screaming deal in a lower-priced oceanfront building has become a needle-in-a haystack exercise. The ability to recognize a jewel when it appears and the willingness to pull the trigger has become vital. Market knowledge will pay handsomely. Do your homework and, if you want an inside advantage, I'm here to help. You can email me at firstname.lastname@example.org
Our inventory numbers for Friday the 13th of November, 2009 are:
MLS-listed Properties in Cocoa Beach and Cape Canaveral
Condominiums, all prices______579
Single family homes, all prices__122
Condos over $500,000________65
Homes over $500,000_________47
"The world's greatest fool may say the Sun is shining, but that doesn't make it dark out."