- The Washington Times - Friday, December 26, 2008

As expected, November was one of the slowest months of the year for the Washington-area real estate market. Every year, November and December are the toughest months to sell a home.

Sellers faced additional hurdles last month, including a troubled economy, low consumer confidence and tighter lending standards. It was one of the hardest months to sell a home all year.

On the upside, last month’s sales were 18 percent higher than a year ago. That’s actually rather remarkable, considering how much worse today’s economy is than it was at the end of 2007.

Lower home prices had a lot to do with the increase in sales. Prices have fallen so far that many who had been on the fence are now ready to buy. Realtors report that first-time homebuyers are out again - those with good credit, that is.

Today’s very low mortgage interest rates are a great help to buyers, but lenders have much tougher lending standards than they did in the first half of this decade.

Back then, loose lending standards allowed many people to buy, and sales surged. However, it was an artificial demand. Home prices and sales stats were pushed upward by a flood of unqualified borrowers buying homes they really couldn’t afford. Now, our housing market is artificially depressed, burdened as it is with a backlog of homes that are hard to sell.

There was one another mildly positive sign in November. The inventory of homes for sale fell to 43,742 last month - the lowest it has been since March 2007.

Despite this drop in the inventory of unsold homes, the smaller number of home sales in November caused sales chances to drop to 12 percent - the lowest they’ve been since February.

Sales chances are calculated by dividing a month’s sales figures for by the inventory on the last day of the month, resulting in a percentage. A figure below 20 percent indicates a buyer’s market. Higher figures mean we’re in a balanced market or a seller’s market.

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Contact Chris Sicks by e-mail ([email protected]).

The statistics in this story reflect a metropolitan area that includes the Maryland counties of Montgomery, Prince George’s, Anne Arundel, Howard, Charles and Frederick; the Virginia counties of Arlington, Fairfax, Loudoun, Prince William, Spotsylvania and Stafford; the city of Alexandria; and the District.

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