'False Assertions Of Bubble Delay Sales': MAR

The Massachusetts realtors have the December numbers out. "Sales of detached single-family homes fell in December for a third consecutive month compared to year ago levels, the first time since April-June 2003 that detached home sales have declined for three straight months." The talking points memo somehow forgot to mention what the full PDF file states. The year-over-year decline in detached SFH sales was 8.8%, with 3,574 sold. "The more moderate sales pace reflects softening buyer demand due to higher mortgage rates and a weak job market, as well as increased inventory levels, which have led to a more balanced market in which buyers don’t feel the same sense of urgency to make a quick offer as they did when supply levels were tighter. False assertions of a price bubble in the local market also have prompted some buyers to delay their home buying decisions" "The sales decline of 3.7 percent that took place between November and December is not unusual and generally reflects seasonal changes. On a month-to-month basis, home sales have now declined for four consecutive months, dating back to August 2005." "The supply of detached single-family homes on the market rose for a tenth consecutive month in December, increasing 31.8 percent over the past year from 22,593 homes for sale in December 2004 to 29,771 this December. Inventory, as stated in months of supply also has risen steadily from 5.8 months last December to 8.3 months of supply in December 2005. Active listings are up from November as well, when there was 28,152 listings and 7.6 months of supply." "In Massachusetts, the market is at equilibrium for buyers and sellers when 7.5-8.5 months of housing supply exists, thus despite concerns about an inventory glut, there’s a healthy balance between supply and demand at the present time." "First-time buyers and empty-nesters looking to downsize and purchase second homes continue to boost condo sales to record levels. The 1,627 units sold in December set a new state record for the month, eclipsing the prior record of 1,580 condos sold in December 2004. The number of condos for sale has increased 43.2 percent in the past year, from 10,180 units last December to 14,581 in December 2005. Inventory, as stated in months of supply, also has risen in the past year, climbing to 9 months of supply this past December from 6.4 months of supply in December 2004." "Compared to a month earlier, condo listings have increased 12 percent from November when there were 13,024 condo units on the market and 8 months of supply." "The statewide median selling price for detached single-family homes rose modestly by 2.6 percent in the past 12 months to $354,000. The predictions of steep price declines in home values that were made this fall are largely unfounded. While the current median price is 5.6 percent below the record high monthly median of $375,000 set in July and August 2005 (due to monthto-month price declines in September and October), prices rose 1.7 percent in November and have stabilized in December." "Condo prices also have begun to moderate, with the statewide median selling price rising 3.8 percent in November from year-ago levels. The median price of $275,000 is down 4.5 percent from the record high median selling price of $287,900 set in July 2005."