I've looked at several different aspects of the market to try and paint a clear picture for those of you who are curious to know. First I looked at the sales for the past six months. This will help us identify any trends that might be taking place. My take on it is that the sales levels are holding pretty flat. As you can see the summer months had increased sales numbers which is very normal. I predict that over the next few months the sales numbers will decrease to a level closer to March and April and possibly even lower due to recent mortgage industry and overall economy concerns.
Second, I wanted to look at the total number of active listings in the Desert Ridge area by price range.
Next, I pulled all of the sales for the past six months by price range.
Lastly, I made some calculations so that we can see what the absorption rate is in each individual price range as of the end of August '07. This will give us an idea of how long it would take at the current sales levels before the inventory that is currently available will be sold. The absorption rate for single family detached homes in Maricopa County as of the end of August was a little over 12.5 months. Currently the number is almost 13.5 months. So as you can see, the Desert Ridge area is, on average, in a better position. Of course, the homes listed over $1M are moving considerably slower than the rest of the Desert Ridge market, but that doesn't completely surprise me. What does surprise me is that it is so much slower. Over two years worth of inventory is not a healthy situation for that segment of the market. I'll be keeping a close eye on this aspect of things over the coming months to try and determine the cause.
Typically the absorption rate in a balanced market is approximately 3-4 months. So for the majority of the active listings, under $750,000, the approximate absorption rate for those homes would average out to about 6.5 months. Not all that bad, especially when compared to 13.5 months for Maricopa County.
I will continue to analyze the data as it comes in and provide you with anything that I see as pertinent.
[tags] Desert Ridge real estate, Aviano real estate, Market Analysis, Absorption Rates [/tags]