What does 2009 hold for us in the Real Estate Market?  Here in Spokane the real estate market got off to somewhat of a slow start.  The combination of the economic uncertainty and record snowfalls in December didn't provide the kick start we had hoped for.  However, not everything is doom and gloom as you can see from the January 2009 results;

Market Activity

January Activity as reported by the Spokane Association of Realtors reported closed sales of 115 units during the month which is down 170 units from closed sales as reported in December's Activity.  This decrease of 170 units represents a 60% decrease in units sold as compared to December 2008.  In comparison to January 2008 closed sales of 201 units we we are down 86 units which equates to a 43% decrease this year vs. last year.   For January 2009 pending sales reported were 177 units, which is down 54 units as compared to December 2008 pending sales of 231 units, this equates to a 23% decrease from month to month.  In comparison to January 2008 pending sales of 267 units we are down 90 units, a 34% decrease.  

During the month of January the average sales price in Spokane County was $206,585 and the median sales price was $170,000.  This is in comparison to December's average and median prices of $201,065 and $179,000 respectively.  Thus on a month to month basis the average price was up $5,520 per unit, a 2.7% increase, while the median price was down $9,000 per unit a 5% decrease.  December is always an interesting month for pricing as this is the catch up month for Realtors to record all their For Sale By Owners and non MLS transactions for annual volume and award purposes.   Thus, historically we see a slight bump in pricing the last month of the year. 

Spokane Inventory for the month stood at 2,530 units, which is up 42 units as compared to December 2008.   Compared to January 2008 inventory of 2,624 units we are down 3.2%.  This is the second month in a row that inventory this year is less then inventory the same month a year ago.   So despite the slow down in sales we see that the market is correctly itself accordingly. 

While inventory levels are adjusting to the market demands, in January our Spokane market absorption rate moved downward to  7.0% from December's rate of 9.28%.  This is the lowest rate we have experienced in the last 2 years.  This low absorption rate resulted in Spokane months of inventory on the market during January to stand at 14.29 months.  This is an increase of 32.6% compared to December's months of inventory available of 10.77 months.   Thus at the current absorption rate of 7.0% and assuming no new listings come on the market, it would take us 14.29 months to sell the current inventory of 2,530 units.

While January was a rough start to the new year not all is lost.  We continue to experience good activity related to  sales and pending sales in specific price ranges and areas of Spokane.  With absorption rates below double digits and months of inventory in double digits it is imperative that you understand the market conditions so that you can be successful in your real estate endeavors.   Enclosed is the Spokane January Price Breakdown and Market Analysis which will provide further analysis and activity for various price ranges and area's of Spokane.  

Commentary

Well the start of 2009 was not exactly what we would have hoped for.  The uncertainty of the economy along with the record snow fall here in December made for a tough January.  It will take some time to see how the economic stimulus packages and government bailouts affect the real estate market.  However, we are entering our busiest season (Spring) of the year and already we are seeing an increase in activity and transactions.  Unfortunately, one person's crisis is another's opportunity and there are significant deals ranging from short sales, bank owned properties and relocation's.  With interest rates in the 5% range there is opportunity to be had. 

Here at the Spokane Real Estate Advisor our primary goal is to educate, serve and provide value to you my clients.  We would like to thank you for your support and business and look forward to our continued relationship and a prosperous 2009!

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