Front Lines

So far the year has started off much as we expected Townhome inventory has continued to rise and is up 56% over last year at the same time. (79 om 2-11 vs 51 om 2010) This dropped in February to 79 available from 85 in January which is something that I would like to see continue. The average list price for a townhome is currently $293,018 which is up noticeably from $267,749 in 2010. So while inventory has grown so has pricing which means (hopefully) that we will see the move up market keep traction and continue as more sellers finally have enough equity to be able to sell and buy again. The single family market has remained consistent and inventory has remained relatively unchanged (37 vs 36) since the same time last year. This is good as inventory had crept up to noticeably higher levels in fall of last year. I do expect that to change significantly in March and many of those homes that came off the market for the holidays will come back on. The number of contracts written dipped to 37 in February from January's 44 but it is still consistent with February of last year's 36 sales. That is significant in that last year we had the stimulus in place and this year we do not. So if demand stays consistent with last year them are seeing the turnaround sustain itself under its own power. We have already run into one low appraisal on a property and while we have worked that out it gives us pause. It does indicate that demand is strong enough to support some increase in pricing but we need the appraisal industry to share the main level of confidence. Mos t of the sellers that weathered the winter months and cane into the year with lower pricing are now gone and the new wave of sellers are more optimistic with the best selling months in front of them. Those homes with great lots in great condition are gone quickly but buyers are passing on those homes that require them to compromise in any way. They are waiting for "something better" to come on the market this spring. At some point, and I expect that to come in March, they will realize that a little compromise is part of the purchase process. Once we start seeing old signs we will see some of these fence-sitters enter the market although they will most likely have missed the best values. Those that keep waiting thinking they will find a value comparable to last fall will miss the boat entirely. It is an exciting year for real estate and as our market continues to unfold I will, as usual, keep you informed.