National Inventory Level on the rise

Happy Monday All, 

Per usual, I start my day with a search of all my go-to news sources for anything interesting to write about as I start the week. Apparently, the NFL has taken over the American news landscape as most of the news related around the Cowboys stinking and the Bears giving up a last second TD. But alas, we carry on and find our own news. 

I have tons of internal sources for tracking real estate locally - I can tell you exact data at time as a member of the NWMLS, but rarely do we find real data on some basic information on a national level. 

I found a great website put up by the St. Louis Fed on economic data...hard to get much more credible than that. What I found was quite interesting. If you have read this blog in the past year, you know INVENTORY is the main factor I think will determine the direction of the market. I know it's rising in my area (Washingotn State), but really wasn't sure nationally...well, we found it and it's not pretty. 

INTERACTIVE CHART HERE

Here's a general recap of the last few years...There was a low of 354,016 in February 2022 which makes sense given many areas were still on COVID lock downs, but what's happened in the last couple years is interesting....

A year later in February 2023, we jumped to 579,264 listings and then a subtle increase to 554,716 a year later in February 2024. All of that seems fairly easy to rationalize ..... 

.......But wait.... there's more..... From Feb to September of this year, we went from 664,716 to 940,980 active listings.... that's 41% increase in 7 months! ...and approximately ZERO news outlets (that I'm aware of and I follow everyone that I think is remotely competent) are talking about it. Frankly, the state of journalism in this country is a sad affair (a conversation for another day), but more importantly, this is simply more fuel to the fire that we will start to see a considerable price compression in the coming months/ years. 

So all the "expert" brokers out there banging the drum that you need to buy now, as prices will "skyrocket" when rates come down (I see you Barbara Cocoran), ask them what happens if inventory starts to rise. I'd bet the answer is silence. 

Anyways, it's just another piece of the puzzle as we follow what I believe will be a unique period in America Real Estate. Text me if you need Snohomish Commercial Real Estate help at 206.306.4034 or email at Scott@WeitzCommercial.com. 

Have a great week, 

Scott Weitz

Washington State market update and general thoughts on the real estate markets....

 

It's been a while since I posted anything. I've done some traveling overseas and spent some time in the hospital (all is well now) ...anyways, it's been a hectic month to say the least, but we are back and headed full steam into election season 2024 and the Harris/ Trump election appears to be one for the ages. 

I've been looking for the last week or so and can't find hardly any articles or stats on inventory. My sense on a local level and in dealing with a lot of real estate brokers is that inventory seems to be increasing. If you have read this blog at all, you know that inventory is the main thing I'm looking at in determining the direction of the market. Frankly, it's a bit odd. I have about 10 sources I generally go to for stats/ data and none of them have any Real Estate news of substance. It's almost as if it's being shielded during the election for some reason. Nevertheless, since I have access to the Washington MLS, I thought I would pull their most recent published figures and report on those....so here we go...my feedback will follow. I have simply copied and pasted from their website....

September 2024 NWMLS Key Takeaways

Active and New Listings

• The number of homes for sale increased throughout the NWMLS coverage area, with 22 out of 26 counties seeing a double-digit year-over-year increase.
• There was a 31.4% increase in the total number of properties listed for sale, with 15,748 active listings on the market at the end of September 2024, compared to 11,983 at the end of September 2023.
• NWMLS brokers added 8,508 new listings to the database in September 2024, an increase of 12.7% compared to September 2023 (7,551).
• The five counties with highest increases in active inventory for sale were Douglas (+67.8%), Pacific (+42.2%), Clallam (+41.6%), Grant (+40.5%) and San Juan (+39.8%).

Closed Sales

• The number of closed sales increased by 1.9% year-over-year (5,828 in September 2024) compared to 5,722 in September 2023.  
• 11 out of 26 counties saw an increase in the number of closed sales year-over-year, while 15 saw a decrease.

Median Sale Price

• Overall, the median price for residential homes and condominiums sold in September 2024 was $635,000, an increase of 5.8% when compared to September 2023 ($600,000).
• The three counties with the highest median sale prices were King ($859,995), San Juan ($829,000), and Snohomish ($760,000), and the three counties with the lowest median sale prices were Ferry ($209,500), Adams ($270,000) and Columbia ($325,000).

Consumer and Broker Activity

NWMLS also provided insights into consumer activities during the month of September 2024:

• The total number of property showings scheduled through NWMLS-provided software remained steady, with 119,927 showings in August 2024 and 119,900 in September 2024.
• In September 2024, there were 16,668 listed properties that were eligible for the Down Payment Resource (DPR) program offered by NWMLS.

Weitz take: in recent posts, I've hinted that we are at or near a market top, I will double down on that take, and I believe we start to see real softening in the coming months as sellers become more desperate to sell and move on with some of their equity. 22 of 26 have double digit increases in inventory; a 34% increase in properties for sale, etc). Whether it be retirees, or relocations, or simply a need for cash, it's bound to happen as homes are starting to sit on the market longer. The Fed is waffling on rates, but frankly, it won't matter. The difference between a 6% rate and 7% at these prices is negligible for the average American as the payment is simply HIGH regardless.  Buckle up.

For more information on Snohomish Commercial Real Estate Investing, you can reach me at Scott@WeitzCommercial.com or text me at 206.306.4034.