What a Half-Year It's Been!

June 2012 Triangle Quick Real Estate Trends and Facts

We’re halfway through 2012, and what a half-year it’s been! Residential real estate has finally taken some meaningful strides toward recovery, and they’ve all been self-powered without divine (or governmental) intervention. Yes, there have been some head fakes in the past, but there's real reason to believe that market turnaround awaits us. A head fake is a term for when the market appears to be moving in one direction but ends up moving in the opposite one.  I’m sure you’ve also seen this in the stock market (Facebook anyone?)

While my clients are always interested in the bottom line -- price – my job is to bring you the whole picture so you can see the trend.  Beyond home prices, key metrics to watch include Days

on Market, Percent of List Price Received and Months Supply of Inventory.

Locally, several indicators showed improvement. Let's see what the rest of the local data has to say:

·        New Listings in the Triangle region increased 0.3 percent to 3,380.

·        Pending sales were up 26.7 percent to 2,497.

·        Inventory levels shrank 27.4 percent to 13,691 units.

·        Prices moved higher.  The Median Sales Price increased 3.0 percent to $198,718.

·        Days on Market was down 2.5 percent to 115 days.

·        The supply demand balance stabilized as Months Supply of Inventory was down 36.3

percent to 7.7 months.  I know you’ve been paying attention and that the tipping point that turns us into a buyers market is 6 months.  We’re getting there --  buyers be aware!

You can pick any one of those faces to illustrate our employment situation!   We seem to be at a critical inflection point in our search for more employment opportunities.  That’s fancy math-talk for the point on a curve at which the upward or downward curve changes from plus to minus or minus to plus.  I’m likening it to that point on the roller coaster where you feel like you are standing still…holding your breath for the next breathtaking up or down.

Job growth provides the dual benefit of stimulating new household growth as well as relieving distressed homeowners. There's also the positive feedback loop of housing creating jobs and jobs creating housing.  Keeping the affordability picture afloat, the Fed has vowed to keep interest rates around 4.0 percent through mid-2013.

The Housing Affordability Index at 186 is 4 percent higher than last year, another positive sign for our market. This index measures housing affordability for the region. An index of 120 means the median household income was 120 percent of what is necessary to qualify for the median-priced home under prevailing interest rates. A higher number means greater affordability.  We still rank among the top-ten best places to live and work in our nation.

Questions, comments, sugestions?  I love a dialogue.

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