July 2013’s RMLS Market Action was published yesterday. Inventory remains tight and consistent at 2.8 months and other metrics are in positive territory as well. The average sales price is $326,500 compare to $287,000 this time last year.
Here’s a metric we’ve never looked at before: the ratio of accepted offers to closed offers. We could call it the “Likelihood to Close.” Year-to-date there have been 15,467 closed transactions and 17,406 accepted offers. That’s and 89% Likelihood to Close factor.
For the same period in 2010, there was a 92% Likelihood to Close. In 2007 94% of accepted offers closed. What does it mean?
Even in a tighter inventory market than we’ve seen in years, transactions are more likely to fail. My personal opinion is that the main cause is buyers are more cautious than ever before and are more willing to walk away.