Wow its November! For all practical purposes, the new year is staring us down! I just did my monthly data retrieval and sales velocity continues to increase! It’s no flood gate sprung open or anything but it is a slow steady pace of modest increasing transaction volume. I have added a couple more data sets to the graph from last month. The main one is a cumulative comparison of last year to this year and totals by category. If velocity remains steady, the next signal of recovery is a change in median prices which shadow the sales volume trends.
At last check, median pricing for the residential property type was the first to enter positive territory. Vacant land and condominium form types are still seeing the median prices trending downwards but it is my forecast that condos will start to edge upwards as soon as we see visitor arrivals increase. This will produce greater buyer confidence in the possibility of better rental income to offset fees and taxes. Aside from increases in sales velocity, the vacant land form type is tied to the comparison of new construction costs and existing home pricing. Its simple really: ” Do I buy land and build a home or is there a resale in the market today that could be purchased for less than replacement cost?”
The key here is that even with only a few months of increased sales volume, the median prices are already starting to react. With every passing day more and more sidelined investors are jumping back into the mix.
Monthly Market Snapshot for November 2010**
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