I love numbers and I love the folks who interpret numbers (note to self: that includes you so add tone of sarcasm)…
Homes sales rise 5.6% from a month earlier! Great news, yet the pundits and the Diana Olick’s of the world, continue to down play the positive and instead focus on the threat of rising foreclosures. To Olick’s credit at least she acknowledges that the lynch pin of everything is job growth. While this may seem like an obvious conclusion, it really is the butter on our toast. With job growth comes consumer confidence, (up by the way to the highest levels since June on the prospects of an improving jobs market), and that confidence, particularly with real estate, is essential to a stable market. After all, who wants to buy a home today that could be bought in a few months at a discount?
So the news was good and consistent with my prediction that we are going to continue to experience ups and downs. I do not see a steady climb in the numbers or charts until we see a consistent and significant decline in unemployment. However, I expect unemployment to continue to ease going forward and thus a gradually improving real estate market; this despite a threatening rise in foreclosures offered for sale.
By the way, distressed sales represented just 33% of all properties sold in November. My explanation for this is that most buyers, while attracted to the price point/discount of a distressed property, can’t stomach the condition of these properties and either haven’t the cash, the time or the vision to fix them. So investors will continue to play a big part in our housing recovery. Additionally remember that investors have the opportunity to purchase homes at the trustee sale for cash before that home goes into the bank’s inventory and onto the MLS. This is important because if we see the banks price these homes appropriately; many of the real steals will be sold this way, fixed and then relisted at higher, market prices and in move in condition.
So over all the reports month over month are very good, albeit not great, but steady and gradual is better than the alternative, in both directions.
I am going to be shutting down The Real Estate Conversation until after the holidays, so have a safe and happy new year.