I hear so many people talking about home prices dropping by incredible numbers each and every month and many times I have found myself questioning where this data comes from. The truth is that home prices in Salt Lake County are increasing, and have been since November of 2007. When a home is bought or sold through the MLS, and most are, that data is recorded. The MLS tracks the total number of homes sold, the total volume, the average list price, the average sold price, the list to sale ratio, as well as days on the market per county. This information is the most accurate and up to date data available. I am constantly blogging this information to the public to help raise awareness about what is really going on, so here is another attempt to try and bring clarity to an otherwise confusing housing market.
The Numbers Through June:
As you can see from the chart above, since the begining of the year both the listed price and the price homes are selling for has continued to climb. The rate of appreciation is lower but homes are still appreciating. When I hear that home prices are falling by as much as 10% I am forced to go to the numbers and see for myself. Home prices are up around 2% from January to June of 2008. Another number that sticks out to me is the DOM field or "Days On Market". The average time it takes to sell a home in Salt Lake County currently is 60 days. Sixty days on the market is not very long especially when I am hearing comments like "Homes are not selling", or "Homes are just sitting". The truth of the matter is that Utah has a strong economy and a very strong housing market and prices are continuing to increase at a healthy rate. All of the numbers for June are not in yet but it is looking like we will break 1100 homes sold in June. This is exactly what I had expected as pointed out in my previous blog post.
How the numbers are reported:
The media typically will report over a time frame which fits their story. For instance if home sales are up from last month but they are down from this time last year they will use a year over year scenario. If we are up from last year but down from last month you will reiceve a month to month blurb about the housing market. Up to this point the news that I have seen has been comparing 2007 - 2008 simply because the last half of 2007 was down and into the first half of 2008. There is an interesting scenario about to happen and I am curious to see the outcome. As we have reached the half way point in 2008 and the market is really stabalizing and improving at a healthy rate, the media will no longer be able to make a year over year comparison to promote bad news. July of 2007 showed the first significant drop in home sales and average home sales price. If the media is consistant and makes their year over year comparison for July they will have to report a huge increase in number of homes sold and will no longer, by their definition, be able to report a troubled market. In July for the first time in a year you will either have: A) Good news from the main stream media about the housing market, or the more likely scenario B) No news at all because good news typically does not sell. Homes, on the other hand, do sell!
It's STILL a great time to buy and you CAN still get a loan. If you would like the actual statistics for any other county in the state of utah feel free to send me an e-mail and I will send you the data so you can compare the numbers for yourself.
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