August sales a little less gloomy.

After July sales seemed almost non-existent, August showed signs of only marginal improvement. Many were expecting that we'd see a little better activity given that mortgage rates continued to see new lows. What's surprising perhaps is that home affordability is even better than when the tax credit was in effect, but that doesn't seem to be spurring any new sales.

The headline numbers both locally and nationally seemed to offer a mixed assessment. Highlights included:

• New home sales were still anemic, but flat compared to July
• Mortgage applications for both purchases and refinancing declined (suggesting the spurt of refis from rate drops has gone as far as it will go for now).
  
• Existing home sales nationally increased 7.6% from July (but down 19% year over year)
• Locally, the inventory is still in the stratosphere at 11.4 months given current sales rates. A minor improvement from July, but still 4 months higher than August of '09. The average sales price jumped to $172.4K.
  

View the Cincinnati MLS based charts

Digging into the numbers a little deeper showed some interesting activity. In particular, the average sales price is being impacted by the fact that higher priced homes have seen more buyers vs. the "starter homes" that were selling earlier in the year. For example, a snapshot of sales in the Cincinnati MLS for homes priced over 1 Million showed that from April, May, and June there were only 11 sold. In the 3 months following, there were 22 sales at that level (having a greater impact on averages given the low sales volumes). The $1M+ homes range is perhaps a skewed segment of the market, but the same type of disparity is being seen at mid to upper level price points.

So far, September seems to be experiencing an increased level of activity with more buyer showings taking place. Whether this translates to actual pending sales and closings remains to be seen, but demand at least seems to be returning.