The Idaho Statesman ran a story yesterday asking suggesting the housing sales numbers might indicate a bottoming out of the market. There are several problems with this sort of story. From start to finish the story bears a strong resemblance to the blogs about Boise real estate which have been trumpeting the return of a healthy market for at least as many months as the market has been in a spiral.
Though it wasn't in blog form I remember being told nearly nine months ago by an agent how prices had "recovered" and sellers were getting asking price and higher for their places. The message then was that we needed to act quickly and buy now. Oddly those same houses, still on the market, are now priced lower than they were last winter. In the last month Boise has been struck by the loss of several hundred jobs. Although some of those jobs will actually be cut over the next few months it is still a blow to confidence in consumer's minds. Yet the article in the paper would have you believe that a 3% decrease in available housing is a significant indicator of a bottom in the market.
Although these market forces don't garner a mention in the story, or undoubtedly in the press release it was based on, there are some real numbers that should have been in the story. The big one is foreclosures and banked-owned properties. Certainly in our neighborhood there has been a greater than 3% decrease in the number of homes on the realtors MLS. That's because more than 3% of the homes are that were on the market in July 2007, and were listed in the MLS are no longer. Some are banked owned and listed as for sale by owners, others are being foreclosed and set for auction. None, however, have made really made the number of available houses on the market decrease.
What would have made for a good story and a responsible piece of journalism is a story about how the MLS numbers might change but are becoming less indicative of the market as sellers are forced to find alternative routes to handling their property. How many unwilling landlords have properties rented to cover some portion of the mortgage? How many buyers have decided that they simply can't afford to buy gas for a real estate agent's Hummer and are selling on their own? If the market is picking up why is the 2009 Parade of Homes going to be free when the 2008 version charged admission? Those would have been much more interesting than reprinting the real estate association's press release.