Now that we’re out of the summer and into October, I did some quick data checks on key market indicators for the US housing market this morning. The short term positives signs are that inventory is tightening, days-on-market is stabilizing, and fewer sellers are relisting their properties. The short term negative is that ask prices are clearly falling and new sellers entering the market are doing so at lower prices this Fall.
1. Inventory levels continue to fall. Still awaiting the slew of REOs that are expected to hit the market (if you believe that banks will releases these all at once…)
2. Days-on-market has leveled off – Active listings are on the market for fewer days – a good sign for sellers.
3. Relists are down. Relisting a property generally indicates that a seller is lowering the price because of buyer inactivity. With fewer sellers relisting their homes, this would mean that seller ask prices are coming in line with buyer bids. This could also be seasonal if sellers removing the homes from the active market as simply waiting until next Spring to give it another go.
4. Ask Prices are moving in a negative direction. New sellers are exhibiting decidedly less optimism, with new listings entering the market 4-5% lower than new listings in July 2009. This could be a small blip when we look back on this, but could also mean that the housing market is starting to run out of steam as tax incentives and economic stimulus programs are exhausted.