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February 20, 2012

9 months of housing-market supply -- for now

It would take nine months to sell all the homes on the market in the Baltimore region at the pace people are buying these days, in case you were wondering.

That's simple math. What's trickier -- naturally -- is knowing how long it will take to sell a particular house. Or whether the months' supply is headed up or down.

Six months of supply is usually the rule of thumb for a market balanced between buyers and sellers. Not surprising that it would be higher than that (advantage, buyers) in January, part of the slow season.

But the other factor at play is the temporary slump in foreclosures for sale -- something that's expected to reverse in the not-too-distant future, now that the bank settlement over robo-signing is done. The Mortgage Bankers Association says foreclosure processing could initially slow further as big mortgage servicers put settlement requirements into place, but that it should speed up afterward.

And on top of that, you've got both would-be buyers and would-be sellers sitting things out for now. When they choose to get off the sidelines will affect the months of supply figure, too.

Some homeowners are waiting for prices to go up before they sell, either because they can't or don't want to accept today's prices. A lot of possibly-future buyers seem to fall into one of two groups, too: Can't afford it now or not willing to pay today's prices.

Among renters who weighed in on a recent poll, just over a quarter said they're renting because they can't afford to buy a house and just under a quarter said it's because they don't want to buy right now. (Another quarter of participants said the No. 1 reason they rent is flexibility -- you can pick up and leave more easily.)

Where do you stand? Are you on the sidelines of buying, selling or both -- and if so, why?

Posted by Jamie Smith Hopkins at 6:00 AM | | Comments (3)
Categories: Housing stats
        

Comments

Lots of shadow inventory to hit md. Why buy now?


http://www.realtytrac.com/content/foreclosure-market-report/january-2012-us-foreclosure-market-report-7022

i fall somewhere in between being able to afford a home and just not wanting to own one right now. In my current financial state, I could probably afford a home, but I would be riddled with debt. What the recent financial crisis has taught me is that too much debt is unsustainable. I simply don't want to risk my savings in today's housing market, especially since prices may fall even further. For now, I'll stay on the sidelines and continue to rent - it's stress free.

As someone who has worked in Real Estate for a long time, I cannot believe the amount of backlog, for lack of a better word, there is with regards bank foreclosed and owned properties. If this surplus isn't dealt with quickly, I reluctantly have to disagree, and think that there is about two years more, in addition to the nine months stated in this article.

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About Jamie Smith Hopkins
Jamie Smith Hopkins, a Baltimore Sun reporter since 1999, writes about the regional economy. Her reporting on the housing market has won national and local awards. Hopkins is a Columbia native and has lived in Maryland all her life, save for 10 months spent covering schools in Ames, Iowa.
She trained to become a wonk by spending large chunks of time as a geek and an insufferable know-it-all.
Baltimore Sun articles by Jamie
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