I received my emailed copy of RMLS Action yesterday and don’t really know what to make of it. It looks like the appreciation numbers (8.9%) in the last twelve months are starting to make more sense. The effect of really strong months a year or more ago are getting dropped and I expect that by then end of the year we will settle into a number between five and six percent for 2007 but that is just one Realtor’s opinion. Annual appreciation numbers work in a consistent market but not so well in a shifting market. Shorter term stats, three or six months, would be more revealing.
Inventory has increased to 5.0 months. That’s higher than we are used to but probably the sign of a healthier market. I don’t think there should be a lot of concern if the market settles in to an inventory level in the four to six months range. Of course it isn’t what sellers want to see but it is good for buyers and the market itself. If we move much above six months, things might get tough.
I wrote the above portion of this post this morning. Now KGW’s 6PM news has just finished including a clip from business reporter, Joe Smith, on our real estate market. I recorded the clip but I am not the video editing expert so will look into how to convert it from a 102mb mpeg into something viewable here. Through the typical media doom and gloom there is a discussion of the danger of over pricing (previous post on overpricing) and the fact that the median home price has dropped from 12 months ago for the first time. That means one house sold above and one sold below the median price.
Overpricing is still a major factor in our market. I was asked for comments on a listing yesterday that is now 30% below its original listing price. It looks to be a steal now because it was so overpriced then. Realtors (probably including us) are equally to blame. It’s easy to tell a seller that you agree with their pricing. It’s what they want to hear so collecting the listing and then beating them up later will probably result in a commission once reality sets in. I know we have lost listings over pricing. Nobody wanted to admit the market was changing and the industry moved too slowly to educate their sellers. There are always the outliers, we had a listing that just baffled us to as why it wasn’t getting the expected results (of course it comes down to price in the end).