Good Signs Nationally For Existing-Home Sales
According to the National Association of Realtors (NAR), sales of existing homes are expected to rise gradually in 2007 from current levels, and should be comparable to 2006. However, new-home sales are predicted to continue the downward slide seen this year. NAR’s Chief Economist David Lereah said, “Most of the correction in home prices is behind us, but general gains in value next year will be modest by historical standards.” The recent decrease in prices (nationally) along with an unexpected drop in mortgage interest rates has created an opportunity for buyers, especially first-time buyers. With all the bad news in the media this year, existing-home sales (transactions) are projected to be 6.47 million this year, an 8.6 percent decrease from last year but the third best year on record. Furthermore, with positive interest rate predictions, inflation fears subsiding and good employment figures, 2007 existing-home sales are expected to rise from the cyclical low and reach a total of 6.4 million, 1 percent below this year’s total. Additionally, Lereah predicts “by the fourth quarter of 2007, existing-home sales will be 4.6 percent higher than the current quarter.”What does this mean for our valley? For those who are buying real estate with a mortgage, now is a great time; mortgage rates are still historically very low, and the market seems to have weathered the storm felt in the rest of the country. With the much brighter outlook from the national media, buyers that are not “interest rate sensitive” can feel more comfortable they are not buying at the “top of the market.”
Last year at this time the talk was … are we going to break the $2 billion barrier? With that barrier broken in October, this year’s question is: Are we going to break last year’s record by half a billion? If December continues the trend of the last few months, then the answer is a resounding “yes.” Pitkin County volume of $232 million represents a 36 percent increase from November 2005’s $171 million. November’s 151 transactions represent an increase of 18 percent from the same period last year. Interval sales continued to decline, dollar volume of almost $9 million represents a 30 percent decline from November of last year. Dollar volume for interval sales were down for the seventh month in a row. Transactions were down only 5 percent from last year, the first down month in the last three.
Due to a change in software the county is experiencing difficulty producing their reports. To date we have been able to extract all but the last two days of November. Excluding the missing two days Garfield County reported a strong November with 215 transactions totaling $119.9 million, already 16 percent over last years $102.8 million. As soon as complete data is available, we will publish the full reports.So will Garfield County reach $1 billion for the year? It is possible given that year-to-date the county is reporting a total dollar volume of $931.7 million. Factoring in the last two days of November and the month of December, it is certainly looking good.
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