The October housing statistics were released today (the national numbers are provided by the National Association of Realtors while the Texas numbers are from The Real Estate Center at Texas A&M University).
Nationally, compared to October 2009, the number of homes sold was down 25.9%. It is hard to get a true picture, however, because this time last year there were first-time homebuyers closing on houses as the original tax credit deadline was in sight. So we are comparing against artifically inflated numbers from last year, which will continue through the November reporting period. Compared to September 2010, October sales were down 2.2%. These figures from NAR are seasonally adjusted. Using actual sales data, the number of homes sold year-to-date is down 2.9%. Fortunately, historically low interest rates continue to move the market along. 32% of the buyers in October were first-time buyers, 19% were investors, and 49% were repeat buyers. Distressed properties (foreclosures and short sales) accounted for 34% of the national sales in October (up from 30% in October 2009 and down from 35% in September 2010). 71% of the sales were financed with a mortgage. Prices were down 0.9%.
Again this month, the Austin numbers look worse as sales were down across all comparable time periods. Compared to October 2009, the number of homes sold was down 31.9%. Compared to September 2010, the number was down 2.35%. Prices, however, were up again. This does not mean that prices have jumped in Austin. Because the tax credits skewed to the lower side of the housing market, far fewer of the entry level homes sold in October. As a result, the percentage of homes with higher prices increased, tilting the average and median prices. The number of contracts being accepted on homes has actually increased for the first time in a number of months (up 15.5% this month through today compared to the same time frame in October).
For the fifth month in a row, the year-over-year comparison for Austin home sales has declined. This followed 9 months of increases, which was itself preceded by 27 months of decreases. The 9 months of increases stretched from September 2009 to May 2010 which perfectly coincides with the tax credits. While a lot of analysis has been done (and continues to be done) on the effect of the tax credit, I think I can simply sum it up by stating that it temporarily halted the real estate market’s slide. However, the market resumed it’s decline when the market interference stopped.
Based solely upon my current observations of market activity, I expect the November numbers to be down significantly, but that December will stabalize and may even show an increase. The early part of 2011 should be about on par or slightly higher compared with the same period of 2010. As we hit March through June, I expect the numbers will decline.
|Number of Homes Sold|
|vs. October 2009||-31.9%||-26.1%||-25.9%|
|vs. September 2010||-2.4%||-5.0%||-2.2%|
|Year-to-Date vs. 2009||-3.4%||-3.2%||*|
|Year-to-Date vs. 2008||-15.1%||-14.9%||*|
|Price of Homes Sold|
|Average vs. October 2009||11.6%||5.8%||0.7%|
|Median vs. October 2009||8.9%||1.7%||-0.9%|
|Months Supply vs. Aug 2008||6.6%||14.7%||45.8%|
|# Homes for Sale vs. Aug 2008||6.8%||14.4%||8.4%|
|*National numbers are seasonally adjusted so no year-to-date comparisons are made.|