The strongest fall market we have seen in the last 6 years continues with rising sales, falling inventory and prices firmingup and continuing to move solidly into a Seller’s market. It is the right time to get your home sold. Looking at the early November month-to-date numbers, the strong fall market should continue with sales continuing to out pace November 2013 month-to-date.
Sales - The total sales for the 12 months ending October 2014 rose to 1,013, up 33% from the 12 months ending October 2013 and the highest volume of sales in the last 7 years since 2007.
Inventory - The average monthly inventory of single family homes dropped down 11% to 565 for the last 12 months ending in October 2014, the lowest average inventory we have seen in the last 7 years. Inventory has not been this low since 2007, the year before the start of the recession triggered by the US banking crisis.
Prices - Average median prices continue to rise slowly. At $344,517, average median prices for the last 12 months ending in October 2014 rose 3.4% over average median prices for the 12 months ending in October 2013. This increase is for average median prices across the board and is largely due to the fact that prices on higher end homes have been reduced so much (some as much as 25%) that sales of higher priced homes are now starting to recover. This is causing the illusion that prices are increasing in all home categories and that is definitely not true.
For instance, right now some price ranges in some neighbourhoods are starting to rise slightly but other price ranges have just stabilized or are still dropping slightly. Therefore, overall average price in any given marketplace cannot accurately predict what is happening. I have found that using an HPI (Home Price Index) works best. This HPI considers all the sales of a typical house in a certain area and compares them to the same type of houses sold in the previous years. We find when we do an HPI that house prices are doing different things in different areas and in different price ranges. I would be happy to do an HPI evaluation on any property you have. Simply give me a call or send me an email.
The rate at which our inventory is being absorbed by sales continues to rise. The average absorption rate of 14.65% over the 12 month period ending October 2014, is now the highest in the last 7 years. At the end of October 2014, there was 5 months of inventory available on the market, down from 6 last month. This is still considered a balanced market trending towards favouring Sellers over Buyers and will eventually put more upward pressure on prices as inventory tightens.
From these numbers, it looks like we can expect the market to continue to rise as we continue in this busiest fall season we have seen in 7 years. Sales for the first week of November 2014 are out pacing sales for the same time period in November 2013.
The market over the next 6 to 12 months will be characterized by continued increasing sales and lower inventory moving more rapidly towards a market that favours Sellers with more competition from Buyers and higher prices. Prices will continue to rise as consumer confidence gathers momentum and brings with it more Buyers.