“Genius is the ability to reduce the complicated to the simple.”C. W. Ceram
The most successful people I know are able to simplify complicated issues. When I reviewed the Northeast Florida Association of Realtors market statistics this month I struggled with how to simplify what seemed like some very conflicting information. As with many issues dealt with in today’s business environment, the analytical complexity was a result of yet another “helpful” government program. Any statistical analysis comparing April, 2010 vs April, 2011 must factor in the 2009 homebuyer tax credit program. As you may recall, homebuyers were initially required to be under a contract by November 30, 2009 which was then extended to April 30, 2010. As a result, 2010 results were directly impacted by this program.
First let’s look at activity. Pending sales and closings for April look very good compared to recent months; however, when you compare them to April, 2010 pending sales are down 13.2% and closings are down 8.8%. To give a little perspective, closings are up 2% year to date over 2010.
In April, 51.1% of closings were distressed properties. That number is down from the previous three months when the percentage was closer to 60%.
Now we will look at pricing. The median sales price for April is down 8.1% when compared to last April; however the average sales price is up 1.7%. Due to the 2009 homebuyer tax credit program many of the closings last April were first time homebuyers. This year we are seeing more mid and higher priced properties selling. We will not see any strong improvement in prices until the distressed properties situation improves. (more…)
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