As we enter 2010 it is interesting to reflect on 2009, which was a challenging year for all of us, but the second half of the year was far more promising. Chris McGrath, broker associate in our office was kind enough to put together some of the latest statistics - see below. We believe, as do most U.S. housing economists, that the housing recovery will continue to accelerate in 2010. Consider the following:
Nationwide Results and Forecast:
Note: Source: NAR Data (National Association of Realtors):
2009 prices fell 12.9%
2010 prices are expected to rise 3.6%
Estimated 2010 existing home sales (approx. 90% of all home sales) expected to increase by 13.6% as compared to 2009.
Estimated 2010 new construction home sales (approx. 10% of all home sales) are expected to increase by 38% as compared to 2009.
Local 2009 Results:
Note: Source: NW WI MLS results for 4 county area; Sawyer, Washburn, Douglas and Bayfield:
12% reduction in total properties sold (’09: 752 sold, ’08: 855 sold).
11% reduction in average price (’09: $141,839, ’08: $159,424).
Nationwide inventory levels mirror what is going on here; the less expensive properties are selling, the more expensive properties are not selling at normal levels. A “normal” inventory level for a healthy real estate market is 6 months (i.e. it will take 6 months to sell the current supply of properties for sale). The inventory level for homes in the U.S. priced below $250,000 is 4.6 months (seller’s market) and for homes priced above $730,000, the inventory level is a staggering 40 months (buyer’s market).
The recent strong performance in the lower end of the market should kick start the higher end of the market in 2010, according to Lawrence Yun, Chief Economist of the NAR. Nationwide, larger lenders are once again focusing on “Jumbo” mortgages (those above $417,000) because they feel these assets are performing well again, that according to Vijay Lala, Bank of America, the largest Jumbo mortgage lender in the U.S. Increased lender interest in providing Jumbo mortgages and a strong, lower-end market are two critical success factors for the eventual recovery of the higher-end market.
Thanks to Chris for being a numbers guy; we remain optimistic and hope you are as well. Have a great weekend and Enjoy...Life is a Gift…Live It!
Gary Nathan
Amanda Mavis
Woodland Developments & Realty
15563 Woodland Road
Hayward, WI 54843
715-699-4040
nathan@garynathan.com
http://www.garynathan.com/
