Here's some '07 vs '06 Memphis data under the microscope. Forget the phrase "local market".
With the recent decline in sales fiqures there are some significant increases in the level of sales of lower priced properties.
Here are some Memphis numbers:
Home Price----'06 vs'07 sold YTD Change
0-19k 64v119 +86%
20-29k 51v43 -16%
30-39k 43v54 +26%
40-49k 38v32 -16%
50-59k 37v49 +32%
60-69k 59v67 +14%
70-79k 58v63 +9%
0-89k 76v39 -47%
0-99k 49v45 -8%
100-119k 111v93 -16%
120-139k 123v118 -4%
140-159k 5v112 +49%
160-179k 94v83 -12%
180-199k 78v67 -14%
200-249k 116v97 -16%
250-299k 110v90 -18%
300-399k 95v75 -21%
400-499k 40v29 -28%
500-749k 29v12 -59%
750-999k 8v3 -63%
1m-& Up 9v2 -78%
data: Memphis Area Association of Realtors
The biggest losers are the categories that start at 160k and up. Median home price levels are down across the board. A local assertion of a 14.8% decline over 06' is an across-the-board decline for the whole year and doesn't place place the data in current queue. How can anyone assert that this is a "short term anomaly" while the market is still tumbling and hybrid loans and pay option arms about to reset?
The biggest gainers are low priced properties, which might be an indication of the strength of the residential purchasing activity of investors who are rapidly capitalizing on the opportunities in the failed subprime market, including the massive acceleration of default and the opportunities to cash-in on foreclosures and short sale opportunities due to a possibility of a favourable combination of circumstances, albeit unfortunate for many homeowners.
Over the long term, is buying a home still one the best investments a consumer can make? I believe that it is.
The "average" sales price for 2006 is being reported as 178.8k while the same figure for "average" sales price 2007 is being reported as 148k. That looks like about -.17226 or a -17% decline in the value of a house for the year ending October, or about a $30.8k (30 thousand 800 dollar) loss in the value of your home in the "average" price range.
What about the "median" sales price for the same month, year to date:
135k for '06 as opposed to 122k for '07. That looks like about a -10% (-.096296) drop in the values of median priced homes equivalent to a 13k, or a 13 thousand dollar loss.
Exisitng inventory is another issue.
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