Its mid-December, the darkest time of the year. Ancient cultures always had a Festival of Lights about this time of year, trying to lift spirits and look forward to the longer days and sunnier dispositions of spring.
So, perhaps it was a glimmer of light that came across the newswires this morning as the ZipRealty housing survey was released for November, showing that housing inventory in many metro areas, including Baltimore, shrank considerably for the month compared to inventory in October. Nationally, the traditional shrinkage of housing inventory from October to November averages just under two percent. But this year the national average was closer to 10%. The Baltimore numbers were just under 4% shrinkage.
Fewer homes on the market should result in some home price stabilization, especially as we move into spring. That, tied in with the pent-up demand I’m seeing in my practics — so many people just waiting… waiting for some kind of good news that will spur them to enter the market to sell, buy, or both — gives me some cautious optimism that once the bad news is all out we will have the beginnings of a recovery. That’s a holiday gift we could really put to use.
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I have a shocking, truly shocking, piece of information to give you. You better sit down.
2007 was the fifth best year on record for housing sales.
That’s not just hot air, that’s factual data from the National Association of Realtors. Now, I grant you, as someone who makes his living in the real estate industry, it shocked me to read that. It certainly didn’t “feel” like good times. My accountant will confirm that it certainly wasn’t MY fifth best year.
Regular readers of my blog will know that I have regularly taken issue with the way the media has painted the crisis in the housing industry… which really started as a crisis in the MORTGAGE industry. But the NAR statistics seem to confirm something that has been noted for many years — it is no longer fruitful to treat the US economy as one monolithic entity. We are a collection of regional economies, and whether it was the “rolling recession” in the nineties that seemed to affect only a region or two at a time, or the current housing situation, there is an argument to be made that much of the pain is centered in a handful of regions.
Recent stories in the Wall Street Journal have shown maps showing where the foreclosure rate has spiked, and a story on National Public Radio this morning (4/16) talked about a critical drop of 24% in housing values in Southern California. But there have been relatively few stories about the strength of housing in certain markets like New York City. I’m going to speculate that the housing markets are worse in areas where the economic trouble is deepest. (Not a high risk speculation, to be sure.) The mortgage/financial industry disaster is certainly having a national ripple effect, but the breathless disaster coverage on the 24-hour news networks, loves to paint a national picture where one really doesn’t exist.
The newspapers — normally a bastion of more thoughtful coverage — seem to be trying to compete with the television networks over who can cry the loudest. None of which is in the best interest of the country. Everyone wants to put their own political spin on it as well, whether its a conservative Republican laissez-faire approach (from the mouth of John “Herbert Hoover” McCain) or the more reactionary, desperate Clinton Campaign (Tell the banks when they can and can’t foreclose! Prohibit them from adjusting their mortgage rates on schedule! Shoot ducks! Drink beer!)
I wish we’d all just act like grownups.
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