Housing market shows signs of bouncing back
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By Paul Sieving
After median home prices in this area fell 30 percent and sales volume 53 percent from the dizzying heights of 2005, the market showed some positive trends in the second quarter of this year.
In the first quarter of 2009, we saw a 20 percent drop in volume and 9 percent drop in median price when compared with the fourth quarter of 2008. These declines, however, are common in all markets in the cold and wet months of January, February and March.
In the second quarter of 2009, which ended in June, we saw a 4 percent increase in price and 79 percent in volume, which is also expected in a normal year.
So, once again, we're down in the winter and up in the spring, although this quarter's large increase in sales volume is noteworthy.
The only year in the past four years where this normal spring market behavior strayed was in 2008, when volume was up and the price was down.
Now, price is up again after an anomalous dip for the year-ago period and volume is up in a big way.
So where do we go from here?
There's no way of knowing without more information, yet an inflection point is
behind us. The only way to truly identify the bottom is in hindsight.
As participants in the local market - whether buyers, sellers, Realtors or
residents - we have to ask what we can do as individuals to assist in the
recovery.
In a word, participate. Everyone needs to be calm, look for the signs, and act in the
interest of the market and a sustainable recovery.
The biggest challenge we face in regaining a healthy local market is the
increasing number of bank-owned properties (REO) that are coming onto the market.
These properties are priced very low and are driving down prices and values throughout the
market.
It’s a double-edged sword as there are some incredible values available,
yet too many of them can have an overall negative effect.
As professionals, we know that the best contribution we can make is to work
toward getting these REO properties back into private hands as quickly as
possible in order to relieve the downward pressure on prices.
This represents a boon to buyers who are fortunate enough to be in the market today. The duty of
professionals and the opportunity for buyers is in alignment with restoring health
to our local market in a way that comes along only rarely.
Mark et activity in the last six months supports the idea that we are getting it done.
It’s a great time to be in business, and we have the opportunity to contribute to
the health of our local market and to the financial well-being of our community
members.
In my future columns, I'll take a closer look at some of the more specific market
ratios as they pertain to market signals.
Paul Sieving is a Realtor with CENTURY 21 Gold Dust Realty, has been director and chair of the MLS Committee of NCAOR and board chair of the Grass Valley Chamber of Commerce. If you have questions, comments or thoughts, send them to paul@paulsieving.com or call 530-274-0906.
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