We’re not done yet with December, but it looks like we will surpass the monthly sales count of the last two years. Last year we had 28 NSDCC closings over the last two days of 2011, and we also will still have the stragglers too – let’s estimate around 230 closings for December, 2012:
|Year||Det-Home Closings||Avg. $/sf||DOM|
*this morning’s total
I agree with sdduuuude’s comment yesterday, that we are just re-gaining ground that was lost in 2011 regarding pricing, with some spectacular exceptions that drifted into the peak-pricing stratoshpere. But you can see in the days-on-market stat that the buyer anxiety is rising, which might cause some people to pay too much – could it end up being a trend?
There are plenty of homes listed at peak prices, hoping for a lucky sale, so we’ll see. It might be a good idea for both buyers and sellers to settle at retail in January, and put it to rest.
I liked livinincali’s comment yesterday that pent-up buyers have been coming to the market now, but tomorrow’s group of pent-up sellers is building in the background. That makes perfect sense and suggests a decent Spring followed by weakness next year.
I can’t see prices falling apart this year, though as a buyer I’d like to see it. To buy or not to buy this Spring is not a decision I want to make.
I think this Spring will be a good time to sell and next year the market will come back down within the trading range established over the last few years.
I have to say, your inventory-flow graphs really got me thinking about “months of inventory.”
Classically, low months of inventory means rising prices. Higher months of inventory means lower prices. Professor Piggington even did a little correlation analysis on this. But even if inventory is low, enough new listings to keep up with demand could stabilize prices or even push them down a bit while keeping the months of inventory low.
Would be interesting to see those flow graphs as a percentage of sales.
Maybe the Professor could do some work on this …
I feel another component of this is the expiration of the short sale forgiveness act expiration of dec 31, 2012. If as a seller you didn’t get your house on the market by Oct ish of 2012, you probably gave up hope of making the dec deadline. There maybe some additional pent up inventory that comes to market if the short sale exemption is extended in 2013. Another variable in the balance between supply vs demand vs no wage growth, foreign buyers, low rates…
Not for sellers who are paying attention, which granted might not be that many.
California already has its own debt-tax exemption in place, so the federal extension has no bearing.
I think we will see short sales and REO listings drop significantly in 2013 around NSDCC. If you bail out, where are you going to go?
If you have banged up credit and try to rent a house in a very competitive rental market, the only ones you’ll have a chance to grab are the over-priced houses nobody else wants.
Suddenly, staying and trying to work something out with your lender looks much more inviting, rather than short-selling or strategic default.
NSDCC December closed sales up to 222, and avg $391/sf as of this morning.
My understanding was that both expire at the end of 2012, the ranges for CA were 400k/800k respectively vs 1M/2M federal exemption.
Kingside, can you help us out on this with an update?
I don’t think sellers (or agents) are paying close enough attention that there was a significant market change before or after Dec 31.
I have a feeling some unsuspecting sellers will be delivered unexpected 1099s with a tax liability
The California act (SB 401) was designed to conform with existing federal law and both are scheduled to expire at the end of the year. sdbuyer’s link to the FTB site is accurate as far as I know.
I heard that the California legislature was willing to extend if the Feds were going to extend. With a democratic supermajority sounds like it would happen. But who knows with the Fed extension up in the air at this point.
Its the kind of thing that could still happen after the fact, January or February or even later.