Pending sales are down some 20% across the board, since the tax credit ended.
Today: 10,000 down from 12,000 last quarter. (keep in mind that many short sales sit in pending status for a long time, they aren’t as likely to close, or to drop out, so we could see an even greater drop in sales than this pending number suggests]
Prices are down nearly 9% on a per square foot market wide basis, in just over three months.
Median price has dropped some $13,000 (this actually caught me by surprise. I would have thought with record low interest rates, people would simply buy bigger and more desirable homes with their approved amounts. So, value would fall without the median actually dropping)
Bankowned (REO) homes on the market are up to nearly 8000 from 4500 in April, and listed short sales have climbed several thousand as well.
I have never seen a market turn so fast, from stable to completely imbalanced in just over three months. Now, we enter the traditionally slower fall/winter season with near record foreclosures ongoing, distressed inventory piling up on the market, and a big drop in buying.
All of these factors point to home price declines the rest of this year. What would stop it? We need to see a BIG as in really BIG pickup in buying, and it is very hard to see where that might come from: we burned up the potential first time buyers with bribes/incentives, the economy simply isn’t creating that many jobs… If investors buy all the distressed homes to rent, the rental market will quickly saturate and go down in flames.