To buy or not to buy, the $100,000-question we all would like to have answered.
For the last three to four years we have observed buyers getting back into the market, but at a slow pace. Prices were dropping constantly and when you bought a house in 2008 and thought you got a good deal, it is worth substantially less today.
So the super question is once again: Did we finally reach the bottom? The following [Infographic] was published by activerain.com and shows the development for North America based on interviews with over one thousand real estate agents. For a more detailed look into our own market area scroll down.
To shed some more light on our specific market area the following chart shows single-family homes sold in the last 12 months in Manatee and Sarasota Counties of Florida (MLS only). Divided by 12 results in the monthly absorption which then is applied to homes which are listed for sale as of March 20, 2012.
The result is pretty convincing, and evidence that we actually did reach the bottom in the price ranges from $0-$400,000 with 2 – 7 months absorption.
An inventory of about 6 months is considered normal. Homes with prices over 400k show an absorption rate between 11 and 17 months. The reason for the higher inventory in this price range is lack of financing for these big ticket homes, but most of all buyers who are thinking twice nowadays before they commit to a high cost home.
“Less is more” is the trend and buyers predominantly look for manageable sized homes which will not break the bank in terms of upkeep and utilities. So here…, you finally have the answer to the question:
Have we reached the bottom?
Yes, for homes under 400k, no for homes over 400k. If you are in the market for an investment property or want to move up to a better home, the time is NOW.
As always, call or email with questions. Besides being an appraiser, I am a Licensed Real Estate Broker and can assist you with all your real estate needs.