Housing Inventories Increase
November 9, 2007
As you might expect, housing inventories for the US rose to a new high recently. The current inventory sits at an 8 year high with a 10.5 month supply. In September alone, sales of single family homes fell by nearly 9 percent. This represents the lowest rate of sales for these types of structures since Jan of 98.
To make matters worse, the inventory of unsold single family dwellings represented a 10.2 month supply. This is the largest inventory in relation to sales in almost two decades.
The general consensus is that this level of inventory will take several years to work through and that is if the market remains at its current dismal level. If it gets worse, the time factor will only increase.
The median price for US homes is at $210,000 which is down 4 percent for the past year. Overall, the median sales price for homes has decreased in 13 of the past 14 months.
One niche area that has been hit hard is the jumbo mortgage market. Jumbo mortgages are needed for those homes that are priced above $417,000. States such as Florida and California where prices in this level are common were hit the hardest.
The problems of the weaker housing market are widespread with sales of existing homes falling in all four regions in September. They fell by 10 percent in the Northeast, 9.9 percent in the West, 7 percent in the Midwest and 6 percent in the South