Posted by: deejayoh

27 responses to “Inventory Growing Like Gangbusters”

  1. steve-o

    Incredible numbers. Really off the chart sort of stuff.

    S Crow says the low rates are leading to mortgages/refi’s flying off the shelves. I have to believe most of them are refi’s. Probably people trying to convert to a fixed rate.

    Ray: it’s funny you said in yesterday’s post that you don’t like charts/numbers. I started reading this blog after you sent me midyear sales numbers six months ago. See you tonight at basketball?

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  2. biliruben

    Is that condo number meaningful? I assume the new developments only put a handful of condos out there at a time.

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  3. Scotsman

    It may not hold up- but it very well may. In fact, I wouldn’t be surprised to see it accelerate. We know last Fall’s sales slowdown has to have left a bunch or residual inventory that will soon come back on line, and the low rates will probably convince some people that this is a great opportunity to try and sell.

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  4. steve-o

    It just occurred to me that the first two Active Listings charts from yesterdays posts will have to be re-sized. The first chart – YtY % change of active listings – only goes up to +55%. Looks like you’ll have to up to +70%!. The second chart – Total numbers of active listings – only goes up to 12,000. Maybe that one should go up to 15,000?

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  5. steve-o

    Oops. The YtY % for active listings will have to go up to 80%, not 70%. Will be interesting to see if this is a multiple month trend or if the numbers will come back down next month (ie: maybe should wait before messing with the charts limits?).

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  6. Buceri

    Last July we hit 11,000 SFH. Let’s see what happens with the seasonal spring acceleration.

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  7. Cougar

    Inventory all over is increasing daily at a nice rate for a buyer like me. Question I have is the pricing. Realtor’s are using the last 12 months sold listings as a base to price new listings. Is there a false security of selling with lower interest rate as bate? Will these new listings become short sales or foreclosures because of the flood in inventory and the buyer waiting or walking on to the next better deal

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  8. Scuba Steve

    We know last Fall’s sales slowdown has to have left a bunch or residual inventory that will soon come back on line, and the low rates will probably convince some people that this is a great opportunity to try and sell.

    I’m looking forward to seeing how this all comes out in the next week or two. My information for a particular area goes back through when I started keeping track of it in early November. Included are a lot of items that have gone off the market unsold for one reason or another right around the end of the year. I’ve seen a few come back last weekend when I checked so more will probably start popping back up again.

    I’m not sure why so many fall off the listings… either the owners decided they didn’t want to move after all or maybe they found a renter?

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  9. Everett_Tom

    Scuba Steve said,

    I’m not sure why so many fall off the listings… either the owners decided they didn’t want to move after all or maybe they found a renter?

    I’ve heard that a good number of sellers are “move up” sellers. Looking to get their “equity” out and use it to buy something bigger / nicer. I know when my wife and I were out looking, we found a few people who’d just got a raise, etc.. and we’re looking for a bigger place.

    Those folks can afford to stay where they are if they don’t get the price they want….

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  10. Gain Knowledge, Wait it Out

    We sold our home in PHX as the bubble was bursting there. Climbing inventory..

    Our listing agent was one of those smart, seasoned, no-nonsense women who had been through these drastic corrections before. She told me I was pricing way too high. She really pissed me off at the time.

    But ya know, as a seller, I was only looking at the past sales in my neighborhood and seeing big $$ signs. I think I was only latching on to that part of it and just skimming over any news that there was a correction going on. But she knew what was in the air.

    As a seasoned agent, I guess she made the decision to FLOW with the market conditions, not try to AFFECT them (the way I see agents here doing in response to the market conditions). Instead of looking for the huge payout from what were becoming less frequent sales, she put here effort into persuading her clients to “price to sell”– SOON!. She chose to make her money on VOLUME. I get it now.

    I like that she didn’t waste her time or possible income for one minute “towing the line” for the local real estate market. She is a survivor because of it.

    We eventually sold our home for about 13% less than we had it originally listed. But thank god we sold it then. Things continued to worsen in the state as inventory continued to climb, the median home vaules falling. And now — the inventory is just sitting there. We were lucky to get out when we did as today, buyers are few and far between.

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  11. James

    plenty of fishers out there. happy to put a for sale sign in there yard for a year and pull it out if no bites. while inventory might be up, prices are still on the very high side. New listings are still priced 40% over where they bought it in 2005. Seattle is always last to the party.

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  12. Sorin

    I have seen a number of homes go off in december and now come back on. Makes it look like a new listing. Oh, not to mention that most come back on at a slightly reduced price.

    It’s been interesting to see the number of homes that have gone contingent, then back to active. I’ve also noticed places come back due to the buyer’s financing falling though. There are clearly people looking and some trying to buy, just judging by the number of people I almost tripped over last weekend touring houses with their realtors. But, as the numbers illustrate, financing has gotten more difficult to obtain for those unprepared, and there is overall a bit more rationality returning.

    I expect that with the number of new construction townhouses and condos that are going to hit the market over the coming months, inventry is almost certain to climb quite a bit more well though the spring.

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  13. Alan

    If the 40% YOY increase continues to hold then this July will see 15400. If 70% is the new norm it will be more like 18700.

    I am told that the Phoenix area has had inventory as high as 50k. I don’t know if that figure encompasses more than one county.

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  14. old_B

    It’s got to suck being a builder right now, especially the smaller/regional builders. First, you’re getting crushed by housing market price deflation (though everyone saw that coming). Secondly, people with very little savings (or equity in their existing home) who can’t pony up the cash to get the right LTV for a mortgage. Thirdly, inventory from late-to-the-party flippers, FBs, other (megacorp?) builders, and people simply trawling their house on the market waiting for a greater fool… the next few selling seasons are going to be a tough nut to crack. A lot of the builders are sitting on land they have to move. Tough spot to be!

    On the other hand, there are still a bunch of sellers with their amateur-hour shelter-brokers(R) who are too dim to realize that low, low, bargain-basement prices are what move houses in a downturn, not wishful thinking. So maybe there is a window of opportunity to competitively price new construction, and steal the lunch from private sellers who are still trying to make money over the 2004 prices.

    So maybe moreso, it’s got to suck to be a housing broker (R) right now. Few transactions, and plus your entire line of work is a sham based on information asymmetry. The builders will recover in a few years, but used-house-salesmen might never have a reputable name again. Life can be harsh!

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  15. S-Crow

    I was informed that SFH inventory in Snohomish Co listed since Jan 1. exceeded 1000 units. My best guess is those are a combination of true new listings and listings that were taken off the market late 2007 and came back on. Regardless, that’s a handful. And that’s not including condo’s, multi-family, or land.

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  16. Pistol Pete

    How about posting Thurston and Pierce County inventory trackers for those of us in the south end

    Thanks

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  17. jesse

    There may be a limit on the total listings per day; something to keep in mind when interpreting the data. I also expect that RE agents are performing triage on many of the listings, that is, concentrating most of their efforts on the listings that have a snowball’s chance of selling. This is going to be mes-sy.

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  18. deeplennon

    Interesting to note that on both the 15th and 16th KC SFH surpassed 9k only to dip below it again somewhat substantially the next morning. Yesterday morning I assumed many were just delisted to it being the end of mid month the night before. I’m not quite sure why it happened again this morning.

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  19. uptown

    Everett_Tom had a good comment about move up sellers starting to sit it out.
    Since these are also the “move up buyers”; are we seeing the beginning of the end for the mid-to-high end markets that depend on them?

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  20. vboring

    Gain Knowledge, Wait it Out,

    seller’s agents have an incentive to convince the seller to reduce their price. they get most of their income from volume, not price. 3% of $500k is pretty golly close to 3% of $450k, so why would they work an extra month to try to sell for the higher price?

    buyer’s agents have an small incentive to convince you to pay more and a strong incentive to convince you to buy just about anything at any price as quickly as possible. this maximizes their income per hour worked.

    so, seasoned, wise, greedy, or stupid, your agent could have just been responding to the incentives of her job.

    this was covered in some detail in freakonomics.

    it is a pretty good argument for why both buyer’s and seller’s agents offer plenty of advice that should be completely ignored.

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  21. MacAttack

    Interesting fruitcake here.

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  22. Scuba Steve

    Everett_Tom had a good comment about move up sellers starting to sit it out.
    Since these are also the “move up buyers”; are we seeing the beginning of the end for the mid-to-high end markets that depend on them?

    Maybe. I’ve noticed the most price decreases and short sales on the lower end of the scale in the zip code I’m following. But it’s slowly been creeping upward since the start of the year, the latest being a bunch of new construction in the 400-550K range about 5%.

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  23. bitterowner

    James said “New listings are still priced 40% over where they bought it in 2005″

    Try this one:

    http://www.zillow.com/HomeDetails.htm?zprop=48943091

    Purchased in May of 2005 for 865K. They tried selling last year with no luck. Now it’s STI with a listing price of 899K. Even if they got their asking price, they will lose money on this house after factoring in transaction fees, interest, taxes, inflation and possibly maintenance & insurance. This house also happens to have a spectacular view of Elliott Bay, downtown Seattle and Mt Rainier from the Southern edge of Magnolia.

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  24. patient

    Tim, a friendly suggestion is to limit the inventory trackers on the sidebar to once a day samples. The level fluctuates quite a lot during a day with peaks around 2am and lows around 6am which to me makes it a bit harder to follow the trends. Perhaps one of the two end points would be a good choice for a daily sample, i.e either 2am or 6am? Just a suggestion.

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  25. Gain Knowledge, Wait it Out

    vboring

    Right on. I would label the agent all of those ‘cept maybe stoopid.. :)

    The underlying theme that I was trying to get to, in a roundabout way was…

    With rising inventory, and the market about to do what we are all predicting., who is going to put aside their dollar- sign dreams and realize the benefit of adjusting their asking price, getting it sold and getting out of a tanking market at the FOREFRONT? (vs languishing in a larger and larger pool of homes for sale)

    The “lesson” of the bubble market I just came from was that the seller who was out ot fhe market in the forefront had better returns vs. those who chose to hold out for what their neighbor had sold thier house for the prior year (in better times)……

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  26. patient

    it’s quite amazing to see that there are still about 50 SFH in average added each day to the inventory. Just imagine if that pace would keep, the SFH inventory would grow with about 18k 2008 to a total of about 26k. Not very likely with the seasonal fluctuations but that’s how fast the inventory is currently growing.

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