December 2010 Market Update

The Bay County Real Estate market finished the year on a surprisingly strong note.  The Bay County Association of Realtors reported 133 sales of Single Family homes in December.  December is historically the slowest month of the year, but this year was different…it tied with April for second largest sales volume, with only May being stronger, with one more house sold (134).  The total inventory of houses on the market was the lowest of the year at 1717, which dropped the “months of inventory” number to the lowest of the year, 12.9.  That is excellent news, considering the average “months of inventory” number for 2010 was 17.92 and the high was 23.14!  However, the median selling price countywide was $149,900, the lowest in six years.  30 year fixed mortgage rates ranged from 4.8% to 5.2%, settling at 4.9% at the end of the month.  

So why the spike in December?  I wish I knew!  The low median house price number leads me to believe that the public is recognising this market as an excellent buying opportunity and is bargain shopping.  Decembers median house price was the lowest the county has seen since March of 2004.  The Realtors I have been talking to are reporting increased traffic for the first few days of January, another indicator that buyers are in a buying mood…as long as the price is right.

Even with the good news, I don’t think we are out of the woods yet.  I have it on good authority that there is another wave of foreclosures getting ready to hit.  This wave is the backlog of repossessons caused by the robo-signing scandal.  As these houses come to market, I expect inventory to rise and prices to drop a bit more…but not too much, since existing houses are already selling well below replacement cost.