Listing Prices Continue to Fall in November
Listing prices for properties available for-sale in various MLS posted a 0.8 percent decline in Nov., and 2.4 percent for the past three months, as sellers continued to drop their prices in an effort to compete with a growing number of bank-owned properties in their neighborhood. Asking prices fell in 20 of 26 markets tracked by a monthly report published by real estate research firm Altos Research and market analysis specialist Real IQ. Asking prices fell at the fastest rate in Las Vegas -- down 3.3 percent during November, and 6.9 percent lower over the most recent three-month period -- marking the eighth consecutive month that Las Vegas has led the pack in asking price declines among the 26 major markets tracked by the two firms. Listing prices rose at the fastest rate in Houston -- up 2.4 percent in November, compared to one month earlier. Denver, Dallas and Houston are now the only markets showing three months of sequential price increases, however, as pricing pressure has become widespread across most of the nation's key real estate markets. Home prices in key markets have become increasingly bifurcated, as institutional sellers have aggressively priced properties in an effort to clear REO backlogs. More traditional retail sellers, however, have attempted to hold the line at a higher price point -- but as the number of foreclosures in most metro areas have grown, listing prices have been pressured downward, and traditional sellers face an increasing pressure of their own to bring prices in line with REO prices. Data from New York-based Radar Logic Inc. has consistently underscored the dual pricing trends in key metropolitan areas. See earlier report. Recession, anyone? “Tight credit, job losses and plunging consumer confidence continued to pressure listing prices in most major markets during November,” said Michael Simonsen, CEO and co-founder of Altos Research. “Recent government actions to reduce mortgage rates and slow the pace of foreclosures could finally start to stem the decline, but we don’t expect to see major changes until at least mid-2009.” Listing inventory levels continued their decline in 24 of 26 major markets, Altos and Real IQ said, with only Phoenix and Las Vegas registering small increases. Across the 10 markets that serve as the basis for the companies' composite index, inventory declined by 5.1% percet in November, and is down 7.5 percent over the past three months. Inventory fell by the largest amounts in Boston, San Francisco and Seattle, the companies said. “Inventory levels have continued to decline for many months and November was no exception,” said Stephen Bedikian, partner and research director for Real IQ. “The real estate industry continues to work through the large inventory overhang but only very slowly.” It's unclear, however, if the decline in listed inventory reflects potential sellers choosing to pull properties off the market, in the hopes that "things will get better." This so-called shadow inventory could represent as much as 25 percent of inventory totals in some of the hardest-hit housing markets, HousingWire's sources have estimated. And while listed inventories are slowly falling, twenty-four of 26 markets tracked had an average days-on-market of 100 or more during November. The average days-on-market rose in all but one market--Las Vegas--but even in Vegas, the DOM measure was effectively flat during November. By far, the market with the slowest rate of inventory turnover remains Miami at an average of 179 days-on-market; Miami has experienced the slowest market turnover in every month since Sept. 2007. For more information, visit http://www.altosresearch.com and http://www.realiq.com. Write to Paul Jackson at firstname.lastname@example.org.