RISMEDIA, Jan. 17, 2007-In HouseHunt's fourth quarter "Current Market Conditions" survey of the U.S. housing market, 65% of its member agents report that home sellers are now getting 95-100% of their asking prices, thereby reversing a downward trend that started eight quarters ago.
This percentage was 59% in HouseHunt's third quarter random survey and 81% a year ago. It was 94% two years ago when the overall housing market was booming and many sellers were getting 100% or more of their asking prices.
"More realistic pricing had to happen for sellers to be competitive in their marketplaces," Noted Michael Bearden, president and CEO of HouseHunt, Inc. "The upward spiral of home price increases of 2004, 2005 and early 2006 simply was not sustainable. The current abundant supply of unsold homes gives buyers negotiating power and many other options."
Bearden said the ratio between asking or listing prices and actual sales prices is a critical component in measuring sales activity, along with time on the market, buyer-seller ratios and annual appreciation. "Collectively, these latest survey results reflect a softer, more stable market in many areas of the country," he continued. "Predictions of a national ‘housing bubble about to burst' simply aren't accurate. I do agree that 2007 could be a good year for home sales and a banner year for individual real estate agents who communicate effectively and do all the things necessary to meet the needs of their customers."
Last week, David Lereah, chief economist for the National Association of Realtors, said the stabilization trend in the housing market is likely to continue throughout the year. "That will support future price appreciation as inventories are drawn down," he said. "Home sales likely bottomed out in September."
HouseHunt's fourth quarter survey also showed that it's taking longer, on average, from listing to contract; there are more sellers than buyers; there is an abundance of unsold homes, positive and negative appreciation in the past year is about 50-50, and that multiple offers on properties have almost disappeared.
One of the strongest housing markets in the country is the Chicago Metro area, where 65% of member agents reported more buyers than sellers and 70% reported annual appreciation of 0-5%. Another 15% reported price hikes of 5-10%. On the other hand, 62% of member agents in California reported a negative appreciation ratio over the past year.
HouseHunt's quarterly surveys in the first half of 2006 showed that the overall U.S. housing market was moving from a seller's market to a more balanced market, achieving near-equilibrium for the first time in eight years.
The fourth quarter, 2006, national HouseHunt survey showed:
Time on the Market: Eighty-four percent of member agents reported that it's taking more than 60 days from listing to contract. Only 74% reported this much time is required in the third quarter survey.
Seller-Buyer Ratio: Fifty-two percent reported more sellers than buyers; 28% more buyers, and 20% said it was about 50-50 in their marketplaces.
List vs. Sell Ratio: Sixty-five percent reported their clients were getting 95-100% of their asking prices. In the Northeast, 52% said their clients were getting less than 95%.
Annual Price Appreciation: Forty-seven percent reported negative appreciation, compared to only 31% in the third quarter of 2006. Thirty percent reported price increases of 0-5%.
Inventory of Unsold Homes: Ninety-five percent reported a "good supply" in all price ranges. Regional reports were about the same.
Multiple Offers: Three of four member agents said their clients were not getting multiple offers.
HouseHunt, Inc. is a consumer-oriented Internet firm that supplies free information and services to homeowners, home buyers and home sellers in 47 states through more than 1,500 member agents and its primary Web sites, Househunt.com and moveUp.com.
For more information, visit www.househunt.com.