May 2008 Home Sales - Are we at the bottom yet?

Posted by Jace Stolfo on Saturday, June 14th, 2008 at 10:17pm.

The question I have been getting asked as a Realtor is: "do you think we are at the bottom yet?"  It depends on what statistic you want to look at.  Is it price? Inventory? Number of homes sold?  It also depends if your comparing to last month, year over year, or historically.  Year over year things don't look too good, month over month things are improving.

I try and look at current supply and demand- the number of homes for sale verses the number that are selling (absorption rate).  I also compare it to the same time period from previous years because home sales fluctuate depending on the time of the year.

  The thing that I have continued to see since the market started cooling down in May of 2006 was our inventory quickly grew and to date we have still not been able to shrink it back down to have more balance with demand.  May had 5007 single family homes for sale in Ada County- the most homes since the slow down started.  This inventory that has failed to shrink is why we have seen prices softening over the past 6 months.  The median home price in May was $205,000 verses $231,000 a year ago.

Personally, I do not think we have hit bottom yet.  Until the inventory starts to shrink it is still going to be awhile before this market gets balanced back out.  That doesn't mean I think it's a bad time to buy though!  Owning a home has always been and always will be a long term investment.  Further, if you are going to try and time the market don't forget a slight increase in interest rates can make it a wash or worse.  Purchase a home when the time is right for you at a price that is right for you.

Get all the May 2008 Home Sale Statistics

Data Source: Intermountain MLS. The accuracy of this information, while deemed reliable, has not been verified and is not guaranteed. This information contained this letter is for general market analysis. No representations or warranties are made as to the past or future appreciation or depreciation of property values.

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