NCW Real Estate Blog

Yesterday’s Wentache World ran this article whose first sentence is “The number of homes for sale in the Wenatchee area in January more than doubled from the year before as housing sales slumped.”   Sounds bad, doesn’t it?  The article has a table that shows January sales back to 2003.

 So, what has changed since 2003?  For one, the market is larger than it was 5 year ago.  In 2006 and 2007, the market was a seller’s market and was constrained by supply of properties available.  A better way to look at this information is to look at

 months of supply.  On average, a market with six-months supply is usually considered balanced.  Less than 6 months is a sellers’ market and more than 6 months supply is more of a buyers’ market.  Seasonality also matters here.  In a low sales months, like December through February, six months supply can seem like fewer homes than when you are looking at peak season months, say June through September. 

A sidebar mentions yet again that Wenatchee topped another nationwide list for increase in home prices from the Office of Federal Housing Oversight with a 13.67 percent increase for the fourth quarter of 2007.

I agree that we have a more balanced market than anytime in the last couple of years.  January 2007 supply, according to Pacific Appraisal data, is 7 months supply or about balanced when seasonality is considered.  I don’t know what the market will do moving forward, but the messages are certainly mixed.  While the media likes to focus on potential bad news that sells, major investors like Sam Zell, who sold Equity Office Properties to Blackstone last year for around $23 billion, think the national recovery will commence as soon as this spring.

As always, it is your call on what the big news is really; is it the continued double digit housing price increase or the easing to a slightly more balanced market from the sellers’ market the past two years? 

Tags: General Interest, Local //