Sunday, April 25, 2010

March sees a big bounce in sales. Will it hold?

Great fanfare was being made over the March housing industry statistics as positive numbers came in across the board. Yet the celebration remains contained as everyone waits to see what happens once the tax credit finally expires.

Nevertheless, there was reason to cheer the feeling that a modest level of confidence has been restored. Some of the positive stats included:
  • New home sales jumped nearly 27% (from a record low in February). Although, the Midwest saw only a 4.3% increase in typically low key fashion.
  • In the Cincinnati area, existing home sales were up 14% year over year. Sales rose 16% nationally for the same period.
  • Local pending sales were over 30% higher in March.
  • The average sales price rose to $152,287 for all Cincy MLS residential closings
  • The inventory absorption rate for the Cincinnati area took a huge drop from over 13 months in February to 8.6 months for March - that's even with the expected increase in March inventory as new sellers come into the Spring market.
(See the full set of Cincinnati MLS based stats for March)

About the only negative in March was that distressed sales (short sales and foreclosures) were 35% of sales nationally, but even that percentage is down from prior months.

April numbers will likely continue the positive trend. However, new home sales figures may be the number to watch. Since there is a lead time involved with new construction it could act as a leading indicator of the market, post tax credit. If the numbers there hold up then you'll probably hear a big sigh of relief.

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