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| Spokane WA Real Estate Market Update May 2010 |
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With the first time and move up buyer tax credits expiring in April (for getting a home under contract) May 2010 Spokane area real estate activity will give us the first glimpse of how the market will fair without these incentives. .
Market ActivityMay 2010 Activity as reported by the Spokane Association of Realtors resulted in closed sales of 519 units during the month which is up 14 units from closed sales as reported in April 2010 Market Activity . This increase of 14 units represents a 2.8% increase in units sold as compared to April 2010. In comparison to May 2009 which reported closed sales of 391 units the market is up 128 units which equates to a 32.7% increase this year vs. last year. May marks the EIGHTH consecutive month where closed residential sales exceeded sales from the same month a year ago. During the month of May 2010 pending sales reported were 448 units, which is down 54 units as compared to April's 2010 pending sales of 502 units, this equates to a 10.8% decrease from month to month. It should be noted that this is the first time since January 2010 where month to month pending sales have decreased. In comparison to May 2009 which reported pending sales of 455 units the market is down 7 units, a 1.5% decrease this year vs. last year. During the month of May 2010 the average & median sale prices in Spokane County was $180,523 and the median sales price was $160,747. This is in comparison to April's average and median sales prices of $179,874 and $163,000 respectively. On a month to month basis the average price was up $649 per unit a .36% increase, while the median price was down $2,253 per unit a 1.38% decrease. In comparison to May 2009 the average and median April 2010 prices are down .68% and 3.2% respectively on a month to month basis year over year. Spokane Inventory for the month of May 2010 stood at 3,304 units, which is down 110 units as compared to April 2010, this is a 3.2% decrease month over month. Compared to May 2009 where inventory stood at 3,159 units we are up 145 units compared to this time last year, this is a 4.6% increase. As we can see from the historical trend Spokane Market Inventory Levels the typical upward trend was broken in May. Perhaps as a result of the tax credit expiration we are starting to see a slow down in the steepness of the typical trend as seen in 2008 & 2009. In addition, while May levels are still above May 2009, this is the first month where the inventory level for the month is lower then the same month in 2008. In May our Spokane Market Absorption Rate slightly decreased from 14.70% in April to 13.56%. The decrease of 3.2% in inventory was offset by the pending sale decrease of 10.8% thus resulting in a 7.79% decrease in absorption rate month over month. During May 2010 our Spokane Months of Inventory on the market stood at 7.38 months, which is an 8.44% increase from April's 6.80 months of inventory. As you can see in the Spokane Inventory Supply Analysis a months of inventory level between 5 to 7 months exhibits a market that is improving. In addition to the decrease in properties coming on the market, the market was not able to absorb them as quickly as in previous months thus the increase in the months of inventory on the market. With the months of inventory moving past the 7 month mark, analyst's would consider Spokane a buyers market. May's absorption rate of 13.56 is the fourth consecutive month of double digit absorption. While this is good news, the concern is that historically May is a month where the absorption rate is continuing to rise as opposed to falling. With the tax incentives gone it will be interesting to see the relationship between pending sales and inventory levels as we move into the dog days of Summer. In May the Spokane Market Breakdown and Price Analysis shows good absorption rates in all areas of Spokane, especially on the South Hill with double digit absorption rates all the way up to the 350K mark. In addition, the North side of Spokane showed a great absorption rate of 15% for the month and as expected the tax credit had a significant impact in all areas under the 200K mark. CommentaryMay continued the upward trend of 8 consecutive months of year over year higher closed sales. Year to date (YTD) closed sales are up 33.1% with pending sales up over 19.9% as compared to May YTD 2009. Inventory YTD is up 16.6% and the average and median sale prices are down 7.8% and 5.9% YTD respectively. With the expiration of the tax incentives occurring in April we may have seen some of its impact in the decrease in pending sales during May vs. April. While closed sales continue to show strength momentum and velocity are measured by pending sales, which maybe a better indicator of current market conditions. The next 2 months are key to Spokane's Real Estate year! If you need assistance or just have some questions regarding the real estate market please don't hesitate to contact us. Our objective here at the Spokane Real Estate Advisor is to assist you achieve your life's dreams through the creation of wealth and security in real estate. If we can be of assistance we would welcome the opportunity to earn your trust, respect and business.
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John Creighton
MBA, e-PRO, GRI
Spokane Real Estate Advisor
Licensed in Washington & Idaho
John L Scott Real Estate
Cell (509) 979-2535
Office (509) 924-4200
Fax (509) 924-4070
Email
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