Current Market Conditions
On the surface, the market seems to be rolling along as it has been the past year plus.
Home prices continue to rise rapidly and buyers are struggling to get the home they want because of stiff competition.
Inventory levels remain very near the lowest they have been since 2006 though we did see only a slight rise to 1.8 months inventory in May.
Buyer activity remains high and steady for the past 6 weeks.
Closed sales in May were up 16% over sales the prior month.
Pending sales rose 8% in May over the prior month.
However, the basic statistics do not tell the whole story.
What can we expect in the future?
Let’s look at the stats from a different angle.
The market follows closely the basic economic rule of supply and demand. The stats above tell us what is happening on the demand side but they do not help much on the supply side.
During the past 6 weeks, up to June 25, we have seen buyer activity remain strong but only steady. Lockbox openings have not improved or declined in 6 weeks. From January until 6 weeks ago numbers improved steadily but since then have remained level. The market may be moderating.
In May, 2018, we saw listings jump up by around 280 (23%) from the prior month and we saw pending sales rise by about only 90 sales. Yet the same time period in 2017, listings increases about 140 while pending sales rose around 200. The current market is producing listings at a much faster rate than 2017 and is less able to get them sold.
This is the first sign the market is weakening or changing.
Please note that this is only one indicator and thus is unable to present a complete picture of a new market direction. So stay tuned while time provides us with more information.
I talked with my Keller Williams PP Broker who likes to look at the number of price reductions for the first clues of a changing market. Here is what she came up with:
June: 1,000 and counting. (This is written before final numbers of June.)
These price reductions have been increasing steadily for 4 months straight and are yet another angle or source suggesting the market is slowing.
In my last Newsletter I suggested there are two determinants of value. If the market is in the early stage of changing, of slowing, then the hysteria value is about to disappear. This will result in a $5,000-$15,000 instantaneous drop in value because buyers will be feeling less pressure to buy.
This notice is not intended to cause alarm. It will take a few months to be certain how major of a market shift we are in. The shift could be only minor and recover in just 3 months or it could be huge and last for years. At this stage there is simply no way to tell for sure. I do feel an obligation to share with you what I see just in case you situation is urgent.
Got Time For Coffee?
Helping get answers to your questions is what gets me up each morning. It is my purpose for being. If you have a question pertaining to real estate ( or chickens or composting for that matter) fire away. I am eager to help. And if you wish to meet for Coffee (or tea or lunch), let’s do it. Thank you
1 LEVEL HOMES ON ACREAGE:
I have a new home with over 3,000 square feet on a beautiful treed 5 acres located about 5 minutes north of Vancouver Mall. For a video tour, click on the link below.
About ½ mile north of Dollar’s Corner (72nd Ave and 219th St.) I have a new one level home with over 2800 sq. ft. on a quiet private 5 acres. For a video, click on the link below.
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KELSEY FAMILY FARM: Lily Comes to the Farm (The latest stories)
Text for Veggies!
Lots growing on the farm in the gardens and greenhouse. We’ll have organically grown vegetables, herbs, and fruit coming in. The sandwich board on the road and our website will announce what is fresh and ready. Text your order and we’ll have it waiting for you at the farm. You can also text to reserve our marvelous eggs and custom roasted Wake the Rooster Coffee. TEXT 1-949-306-9977 (Kelseyfamilyfarm.com)
Pickling this year?
We have organically grown pickling cucumbers and fennel this summer. Call or email in your orders and I will let you know when it is ready. Harvesting will occur in late July through September. All orders are picked within hours of delivery.
More about the Kelsey Family Farm can be found at www.KelseyFamilyFarm.com
The brain child and owner of Kelsey Family Farm: Jonell Kelsey
Keller Williams PP