Shock! Horror! Front page news that the housing market is in poor shape!!
When the market picks up, [the guy in the story will] consider selling again.
When will that be? That’s what everyone is trying to figure out.
Well, let’s see. Examining the graph at right, and I know I’m no economic genius, but I put the Rag’s crack research staff to the test and they told me that they estimated the housing market will pick up (in terms of the time houses are staying on the market) somewhere between February and May, like it does every single year. I’m so sick of the worked-up negative real estate news. I know the market is fluctuating, but come on, some level headedness is called for.
The Sac Rag 
Actually, this data does support the theory of a cooling housing market in our region. Even though there are cylical peaks and valleys in terms of how long it takes to sell a home within a given year, the more important thing is that in the last few months it has taken longer to sell a home than in the same period in the two to three years previous.
Now, what would really be useful would be a comparison of this chart with state and national trends.
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again, i’m still no economic expert, but wouldn’t an increased supply of houses
http://news10.net/storyfull2.aspx?storyid=14569
lead to longer time on the market?
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An increased supply of houses will lead to a longer time on the market, if the demand for those houses doesn’t keep pace – which it did until 2005. It seems that the supply is now overshooting the demand.
Despite the number of houses for sale and the length of time on the market, our region saw a 20% decline in 2005 compared to 2004 in actual houses sold:
http://www.biasup.org/sales.html
This would indicate that there’s an oversupply, and some sort of price correction is going to have to happen in order to compensate for the decreasing demand.
For those of us who own homes, what this implies is our houses may not be worth what we’d like once things even out.
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And, if you are in the market for a home, might I suggest a spacious 3/2 in the Pocket area with a 528sf covered/enclosed patio that’s perfect for outdoor entertaining? (My house just went on the market yesterday.)
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“if the demand for those houses doesn’t keep pace”… isn’t that what we see in the chart every winter?
“It seems that the supply is now overshooting the demand.”… that is the point i’ve been trying to make all along: I think that non-economic factors– especially overblown, confusing and contradictory media coverage– are at play in the real estate market and i just wish everybody would shut up about it.
maybe Sac Rag should buy a house. one of those old Frat Houses along 21st Street near the Bee maybe? or one of those retro futuristic River Park jobbies.
http://www.eichlernetwork.com/streng_saga.html
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Every winter, you do see fewer buyers, but that’s a seasonal variation. Most people, including the media, are comparing 2005 with 2002-2004, when home sales were actually increasing. 2005 represented a decrease in the number of buyers, to what the link I put in my last comment attested.
If you look at the graph you put up, you will see that in December 2005, it took longer to sell a home than in December 2004 (or 2002 or 2003 for that matter). Comparing the same time period in each year establishes a baseline that accounts for the effects of seasonal variations.
“supply overshooting the demand” is a statement of fact and doesn’t have anything to do with what the media is reporting. There are simply more houses on the market than buyers, and this oversupply was higher in 2005 than in 2004, which is why home sales have decreased in 2005 compared to 2004.
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at a certain point, though, don’t we have to take all economic analysis out of the discussion? a business for example, would never supply twice as many widgets as it supplied the previous year if demand was falling, would it? i mean *maybe* if Dale Schornack told them to…
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