Fun (and NOT so fun) facts about our market.
What’s going on with the Troup County housing market?
Having recently completed the first quarter of real estate sales for 2011, we took a look at market activity and compared it to the same three months last year.
For clarity, only single family residential sales were analyzed.
First, let’s take a look at the listing inventory. For the past several years the market has suffered from an over-supply of properties – especially in the $100,000 to $150,000 range. There’s some good news here. The number of new houses entering the market during the first three months of 2011 dropped from 374 in 2010 to 324 this year. A decline of 13.4%.
Active listings are also beginning to decline. That’s also good news (for sellers) because the persistent over-supply has had a negative impact on sales prices.
According to Georgia MLS statistics, foreclosures entering the market dropped from 50 in 2010 to 45 this year – a modest decline of 10.0%.
Now for the “not so good” news. Although we were all hoping for market improvement as we moved into the new year, the sluggish economy continues to concern consumers. Although interest rates are great and home buying indices suggest that the time to buy a home has never been better, the high jobless rate and lack of consumer confidence continues to have a downward impact on sales.
Closed sales of single family properties declined moderately over the period from 145 in 2010 to 120 this year – a decline of 17.2%.
The sales volume really “took it on the chin” with a decline in residential sales from first quarter 2010 to first quarter 2011 of $4.08 million – 26.8%.
As is the case virtually nationwide, the sale of foreclosed properties continues to dominate our local market. For the trailing twelve month period, the sale of properties from less than $100,000 to $150,000 represented a substantial portion of overall market activity – 77%.
Average sales prices were a reflection of the weaker market with declines during the first three months of 13.7%, 15.8% and 11.2% respectively.
Looking forward, we believe that the large market surpluses will continue to be absorbed over the next 18-24 months. The virtual lack of new construction should reinforce this trend. Annual housing demand, although dampened by unfavorable economic forces, will continue to erase current market imbalances.