|
Last month we experienced a 6.4% decrease in sales activity. Typically, sales increase starting as early as February and hit a peak from May through August. So, are we about to experience another slump in sales? The answer is "no". The Federal Tax Credit, which expired at the end of April, created a deadline that promoted buyers to make a push to buy in order to take advantage of the Federal Tax Credit. This prompted many first-time home buyers to move up their timeline to buy. We are now starting to see sales on the increase again and should have a good selling season that will extend through August. Although November and December are typically two of the slowest months for sales, we expect the market to remain strong through the end of the year with the California Tax Credit, which doesn't expire until the end of December.
If you wish to find out more about the California Tax Credit, then go to: http://www.ftb.ca.gov/individuals/new_home_credit.shtml.
As the above chart indicates, the average time on the market for the current inventory is just over five months. Five months is considered the equilibrium between a buyer's and a seller's market. A market period less than five months is considered a seller's market and anything over is considered a buyer's market. While these statistics group all price ranges together, listings under $500,000 have a current market time of about three months. Listings from $500,000 to $1,000,000 have a market time of about six months and homes listed above $1,000,000 have a market time of about nine months. Presently, we have a seller's market below $500,000 and a buyer's market in the price ranges over $500,000. |
