- The Washington Times - Friday, January 23, 2009

December was, as it always is, the slowest month of the year for area home sales. It’s just not a great time to sell. Still, more than 5,000 sales were made last month, an improvement of 40 percent over December 2007.

Even with that surge in sales, home sellers still struggled against the significant leverage that buyers wield in today’s market. With sales chances at only 13 percent in December, sellers were not in a good bargaining position.

Sales chances are calculated by dividing a month’s sales figures 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.

The inventory is the issue that has plagued our market for the past few years. Because we ended 2008 with an inventory of about 40,000 unsold homes, we now begin 2009 with a big backlog of homes looking for buyers. Unless sales take off dramatically this year, we can expect inventory to remain very high and homes to stay on the market for three to four months, on average.

There is, however, a bit of a silver lining in this inventory story. At the end of 2007, we had 44,000 unsold homes in the inventory, so last month’s figure was an improvement.

If you look back a little further, you’ll get depressed. At the end of 2003 and 2004, there were just 10,000 homes on the market.

If 2009 sales continue to improve like they did in the latter half of 2008, it could help our inventory problem. That would cause prices to stabilize and return a little bit of balance to the buyer-seller relationship that currently favors the buyer in almost every case.

c 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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