July, 2011 – As of June 30, with 2 full quarters of data, we compare trends in median price, unit volume, distressed property and days on market to quarter-ago and year-ago numbers. As we have mentioned, the price and distressed property trends are tightly coupled and go in opposite directions. The data from the last two quarters exemplify this effect.
|
Time Period
|
Total units %Distressed Median Price DOM
|
|
Q1-09
|
120
|
37
|
$305,000
|
149
|
|
Q2-09
|
227
|
26
|
$300,000
|
151
|
|
Q3-09
|
220
|
46
|
$307,200
|
140
|
|
Q4-09
|
218
|
41
|
$271,750
|
113
|
|
Q1-10
|
184
|
50
|
$265,000
|
92
|
|
Q2-10
|
260
|
44
|
$269,250
|
97
|
|
Q3-10
|
233
|
46
|
$279,000
|
94
|
|
Q4-10
|
217
|
51
|
$249,000
|
64
|
|
Q1-11
|
243
|
60
|
$227,000
|
118
|
|
Q2-11
|
281
|
53
|
$225,000
|
100
|
|
Please click on the links in the paragraph headings below to see charts of each important trend.
Median Price – In order to account for seasonality, we want to focus on year-to-year comparisons. As the external market forces related to the housing crash diminish, we are beginning to see normal seasonal trends emerge once again. One of the seasonal regularities is that prices tend to peak in the third quarter of each year as the summer selling season unfolds. This has happened in 2009 and 2010, and we will look for it again next quarter.
The median price for single family residences (SFR) sold in Q2-2011 was $225,000, compared to $269,250 in the year-ago period and $227,000 in the last quarter. This amounts to a year-over year decline of 16%, and a decline of less than 1% since last quarter. Prices are poised for a seasonal increase in Q3.
Unit Volume – The strongest positive trend in the Nevada County market is in the monthly number of homes sold. The total number of SFR sales in Q2-2011 was 281, compared to 260 in the year-ago period and 243 in the previous quarter. This amounts to a year-over-year increase of 8%, and a 16% increase over last quarter.
This is the highest unit volume since Q4 2005, and a strong sign of an accelerating recovery.
Days on Market – Last quarter we saw an unexpected spike in DOM, and it was related to a big increase in sales of distressed properties that had lingered on the market. In the current quarter, DOM has returned to the trend line. At 100, this is essentially unchanged from 97 in the year ago period and a decline of 15% since the spike in the previous quarter. This is a fairly normal market time for a healthy market, if anyone remembers what that looks like.
Distressed Sales – The level of distressed sales (Short Sales and REO) had risen to around 50% in Q3 2009 and been stable at this level until spiking to 60% last quarter. Distressed sales were 53% of all sales in Q2 2011 and have returned to the trend line.
This relative stability (absence of significant and enduring increases) is an encouraging sign of an unfolding recovery. Even more encouraging will be a measurable decline in distressed sales. We are seeing strong improvements in sales volume and days on the market, while distressed sales are stabilizing. Prices continue to decline, although at modest levels, and seasonal trends are once again establishing themselves.
In the Nevada County Real Estate market, we are bucking the national trends of declining sales volume and increasing marketing time in significantly positive ways. Next quarter we will look for the seasonal peak in prices and perhaps a decline in distressed sales, as signs of a recovery gaining traction.
Paul Sieving is a Realtor® with Good & Company Realty, a former Director and MLS Chair of NCAOR, was Board Chair of the Grass Valley Chamber of Commerce in 2004, and has served our community as a real estate professional for 12 years. Comments, questions and thoughts are welcome at Paul@PaulSieving.com or (530) 274-0906. 
