- The Washington Times - Friday, September 25, 2009

Last month, Washington-area home sellers had the benefit of sales that were 15 percent higher than last year and inventory that was 24 percent lower.

That combination is making 2009 a much better year for sellers of existing homes than 2008.

Buyers are taking advantage of the steep price drops we’ve seen over the past two years. That’s what is fueling the increase in sales - even during a downturn in the economy.

That same drop in prices is the reason why many homeowners are choosing not to sell. That’s good for those who do sell because they face less competition.

Unsold inventory in August was down to 36,340. That’s the smallest number of homes for sale we’ve seen since February 2007.

Inventory has fallen for both of the reasons I cited above - more buyers are buying and fewer folks are selling.

Regarding sales, August’s total of 8,338 was not only 15 percent higher than in 2008, but was an increase of 55 percent compared to 2007. That was the year when sales were at their worst - and that slower market is what caused prices to fall so much in 2008.

Then, that price drop is what dampened the enthusiasm for selling. Only 9,587 homes were listed for sale in August. Compare that to 13,800 in August 2007 and 15,300 in August 2006. You can see clearly how lower prices have reduced the number of homes coming on the market.

Taking these two statistics together, we find that sales chances were 23 percent last month - much better than the dismal 11 percent we saw in August 2007.

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.

Contact Chris Sicks by e-mail (csicks@gmail.com).

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