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July 2006 BloodhoundRealty.com Market-Basket
of Homes: Values down 1.83% on slow sales

This fall in Valley schools, the faces of the teachers may change, but the kids may be the same. The annual selling season, when parents move in time for children to start the school-year in their new neighborhood, for the most part has not materialized. Home prices for July were down 1.83%, compared to June, in the BloodhoundRealty.com Market-Basket of Homes. More significantly, only 151 home sales were recorded, a fairly low number for this time of year. Average sales prices were down $4,715, from 257,999 in June to $253,284 in July. Values are down $16,591, or 6.15%, from the December 2005 high of $269,875. Market-Basket homes spent an average of 74 days on market, five days more than in June.

As has been the case in recent months, most Market-Basket homes are selling at or above list price. A few deeply-discounted properties pulled down the average, and average discounting netted out to 1.61%, down from 1.75% in June.

A total of 151 Market-Basket homes were sold in July, down from 176 in June. However, inventories of available homes have declined. There are now 1,506 homes available for sale in the Market-Basket, where there were 1,525 in June. With sales of only 151 homes, the implied absorption rate is almost 10 months, but, interestingly, there are 179 Market-Basket homes currently listed as "Sale Pending." A six-month absorption rate is considered normal.

Based on the idea of the Consumer Price Index market-basket of goods and services, the Market-Basket of Homes uses average sales prices for a small subset of all Valley home sales to get a clearer idea of what is happening in the middle of the bell curve. The alternative method, striking a median among all closed transactions, introduces too many extraneous factors to provide a reliable indicator of what is happening to prices for those homes that are most avidly desired by the greatest number of people. To that end, the Market-Basket of Homes looks at sales prices for MLS-listed suburban homes from 1300sf to 1900sf built in 1998 or later, the homes that drive the resale market.

The BloodhoundRealty.com Market-Basket of Homes is updated monthly and is always available at http://www.BloodhoundRealty.com/MarketBasket.pdf