By Mike Bodeen · 31 January 2022
A broken record? Same ole, same ole? Been here done that? Whatever we call it, they all seem to apply these days.
In this case, the first quarter is shaping up to continue its high-rise ascent and there doesn’t seem to be any slowing this machine yet. Perhaps things could slow in the 2nd quarter as prices and mortgage rates get too high for the buying public palette. But so far, we’re not seeing any numerical evidence of that.
So, here we go!
First, let’s again talk boringly about the lack of inventory available. As of today, there are but 5,348 homes for sale – even less than last month (5,910). This is a 10% drop. Two years ago on this date, we had 11,804 homes on the market. 20,000 to 30,000 homes for sale would be expected as an average for our market, just to help put that in perspective.
There are 11,174 homes currently under contract (sold). This compared to 9,947 last month. This number is so mind boggling when you compare it to the limited number of homes on the market, which means that homes are still selling VERY quickly.
Two years ago, we had only 1.9 months of supply available. Today, we have 0.7 months (18 days) which means if no new listings came on the market, all the active listing inventory would be wiped out in 18 days.
The active listing (unsold) price per square foot (PSF) is at $340. Last month it was $327 PSF. One year ago, it was $292. Why is this number important? This number is usually a leading indicator of closed prices in 6-8 weeks.
The Under Contract (sold, awaiting close) PSF is $289 PSF (See Chart). This is the best leading indicator we have available. One month ago, the Under Contract PSF was $284. In one month, this has risen $5 bucks a foot. It was $221 PSF one year ago – a $68 PSF rise in one year. Will we see a similar rise in 2022? I don’t believe so, but then again, no one’s been right calling this market yet.
When we begin to see listing inventory increase, market time rising, and listing price reductions, we may begin to see some real help for buyers. But that’s not now!