Welcome back!

Did you know that we have a new roller coaster ride opening right here in Tucson?  Some have already been riding it and have raved about it’s extreme lifts, fast drops and corners that are taken at break-neck speed.  Interested?  It’s also known as the Tucson Real Estate Market.  While in general it seems to be heading in a positive direction, there is much excitement along the way.

As I discuss the market, I will be comparing this month’s numbers (January 2009) with those from last year (January 2008) and last month (December 2009).  Even though it is now February, we won’t have February’s numbers until mid-March.

Home Sales Volume and Home Sales Units

Home Sales Volume and Home Sales Units both decreased this month over last month.  This is to be expected to a degree because homes that were pending last month are now completing as sales this month.  However, we had fewer homes close than were pending last month.  This is likely due to the fact that so many of the contracts were short sales and they are more likely to fall through than other sales are.  Still, I was surprised that the numbers decreased so sharply.

This month’s Home Sales Units decreased by 24% over last month but only 5% over last year.  The volume decreased by 21% over last month and 26% over last year.  Looking back at the numbers from two months ago (since we had an unexpected jump in sales last month), I am seeing a 9% decrease in sales units and an 11% decrease in sales volume, which is probably more in line with seasonal trends.

The home sales volume/units category is one that we need to keep a very close eye on.  Don’t forget to fasten your seatbelts…

Median and Average Sales Prices

Median and Average Sales Prices continue their decline and will likely continue to do so as foreclosures and short sales continue to hit the market.  This means that there are more deals out there for those who can afford to buy.  However, it also means that lower-priced distressed properties are competing with non-distressed properties for buyers.  That’s not good for sellers who need to sell their homes right now.  The best thing that a seller can do right now is differentiate his/her home from the surrounding “bargain” properties by offering something unique.

Pending Contracts

Pending contracts is the point in our ride where the coaster once again headed straight up.  Pending contracts shot up by 54% over last month, although they are still down by 13% over last year.  It is normal for pending contracts to rise in January because more homebuyers focus on their search after the holiday season is over.  However, this is a little more than usual and could be a good sign if all these Pending contracts make it to closing.  At this point 25% of our pending sales are short sales or foreclosures, which means that they may not all make it to the signing table.  If all the pending sales do close, it will wipe out 12% of our current inventory.  We currently have 941 pending and total active listings of 7,694.

Active Listings and New Listings

Ready for more excitement?  New Listings in January increased by 57% over the new listings in December.  We more than doubled our new listings.  It is very usual for new listings to increase at this time of year.  In fact, January of 2008 experienced a 135% increase over the previous month.  This year, we put a third fewer new listings out at the beginning of the year.  With all the listings that expired, sold, or were taken off the market, our new listings had almost no effect on the amount of Active Listings.  In fact, we saw less than a 1% increase in active listings.  Surely, this is much needed news as we work to clear excess inventory.

As of January 2009 we have 7,694 active listings on the market, which leaves us a 13 months’ supply of homes at the pace that January’s sales were going.  This is much more in line with November’s 12.6 months’ supply and better than the 15 month supply we had going on last January (2008).

Around the Bend

So what’s next?  Only God knows….  Heh heh.  The good news is that our inventory did not dramatically increase in January.  Our pending sales have increased by a huge margin so things are looking up.  However, we have had a lot of ups and downs in the market and I hesitate to give a rosy outlook just yet.  I need to see several months of sustained selling at a good pace before I can declare Tucson’s Housing Market to be on the final stretch of this ride.

I am personally seeing a lot of activity.  Buyers are ready and willing to buy, mortgage rates are low, there is a new $8,000 tax credit for first-timers.  My short sales are for the most part receiving offers on them fairly quickly and the banks are processing them at the slow but steady pace I have come to know and accept. 

Life goes on and I’m ready for the next big curve… 

Technorati Tags: bank negotiations, banks, buying a home, contracts, distressed properties, foreclose, Foreclosures, housing market, pricing strategy, real estate, real estate market report, roller coaster ride, sales volume, seasonal trends, short sale, Short sales, tucson, tucson real estate, Tucson real estate market, Tucson real estate market report