Over 78% of sales occur $200k & under!
Tue, Mar 9, 2010
I was sent this 2010 market data from Active Finance Group, LLC. Very interesting statistics of what is actually selling these days! I find this to be true in my experience - all my buyers are buying homes under $200,000 lately! Click here to see the newsletter in a new window. - Becky
| Total | ||
| Jan-10 | Closings | |
| 5575 | ||
| Sales price | No. sales | % of total |
| 0-100,000 | 2219 | 39.8027% |
| 101-200,000 | 2154 | 38.6368% |
| 201-400,000 | 998 | 17.9013% |
| 401-750,000 | 253 | 4.5381% |
| 751-1,001,000 | 47 | 0.8430% |
| 1,001-2,000,000 | 56 | 1.0045% |
| 2,001-5,000,000 | 21 | 0.3767% |
| 5,001-10,000,000 | 1 | 0.0179% |
| Total | ||
| Feb-10 | Closings | |
| 6635 | ||
| Sales price | No. sales | % of total |
| 0-100,000 | 2482 | 37.4077% |
| 101-200,000 | 2557 | 38.5381% |
| 201-400,000 | 1157 | 17.4378% |
| 401-750,000 | 300 | 4.5215% |
| 751-1,001,000 | 62 | 0.9344% |
| 1,001-2,000,000 | 48 | 0.7234% |
| 2,001-5,000,000 | 20 | 0.3014% |
| 5,001-10,000,000 | 2 | 0.0301% |
| Supply as of 3-4-2010 |
| Total no. actives 35110 |
| List price | No. Active listings |
Supply (in months) |
| 0-100,000 | 8034 | 3.42 |
| 101-200,000 | 12064 | 5.47 |
| 201-400,000 | 8321 | 7.64 |
| 401-750,000 | 3493 | 12.63 |
| 751-1,001,000 | 3253 | 59.69 |
| 1,001-2,000,000 | 2133 | 41.02 |
| 2,001-5,000,000 | 763 | 37.22 |
| 5,001-10,000,000 | 82 | 27.67 |
| Over 10,000,000 | 25 |
| List price | Av. Days on market |
| 0-100,000 | 85 |
| 101-200,000 | 107 |
| 201-400,000 | 135 |
| 401-750,000 | 188 |
| 751-1,001,000 | 234 |
| 1,001-2,000,000 | 258 |
| 2,001-5,000,000 | 361 |
| 5,001-10,000,000 | 369 |
| Over 10,000,000 | 377 |
| Summary |
| Over 78% of sales occur in the $200k and under category |
| Over 90% of sales occur in the $400k and under category |
In summary, the numbers don’t lie and market trending is abundantly clear. Two core elements drove the market into the sewer beginning in the 2nd quarter of 2006, which were rapid price deflation of residential assets coupled with a simultaneous dramatic lack of available take out financing.
There is still an oversupply of active properties for sale (we believe the oversupply is approximately 40%) but that needs to be carefully analyzed in specific pricing segments as opposed to a “bulk number”. The majority of oversupply exists in properties that retail for a price that exceeds the FHA upper end lending limit. We are seeing predictable and relatively short resale marketing timeframes for properties that retail for $250K and under.
Price deflation has largely occurred at this point and we are seeing modest price inflation in the $250K (retail) and under category and properties that retail for any price that is underneath the FHA upper end lending limit.
Market speed and velocity for properties that retail for a price that exceeds the FHA upper end lending limit is lethargic and will continue to be that way until there is a more competitive take out market for loan amounts over the FHA lending limit as there are only so many 800 FICO score buyers with 30% (or more) in cash for a down payment.
Prices being paid at Trustee sales recently are downright stupid if your business model is based upon an near term exit strategy, but the Bidders/Buyers attending the sale typically have little to no risk in the purchase, or the result reinforcing the largely accepted thought that it’s easy to spend someone else’s money. We believe the successful investor will “shoot with an arrow, not a shotgun” in this very competitive environment.
We are seeing some good values in the purchase of bank recovered assets from local or regional lenders, and short sale purchases.
There are still some “home runs” in the market – we see them daily but they are few in number and we see a lot more “singles and doubles”. Care and caution are the order of the day as we see it.
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