- The Washington Times - Friday, April 30, 2010

March was very good to Washington-area home sellers.

It was easier to sell a home in March than at any time in the past four years. As the chart at the bottom of the page shows, sales took off as the snow melted and buyers took advantage of low interest rates and the federal homebuyers tax credit, which expires today.

The inventory of unsold homes rose along with sales because more folks put their properties on the market. About 14,000 homes were listed with area Realtors in March, up from 7,800 in February. That’s a huge increase, which could have resulted in a glut of unsold homes (inventory) in March and weak competition among buyers.

That’s not what happened, however. In fact, competition increased dramatically, and here’s why: Sales of existing homes jumped 64 percent from February to March. More than 10,000 homes were sold last month, the highest monthly total in five years.

PDF: Charting the market

So even though the number of home listings nearly doubled from February to March, by the end of March, the remaining inventory of unsold homes was just 12 percent higher than in February.

That’s why it was so much easier to sell in March - supply was up 12 percent, but demand was up 64 percent.

When we combine those two statistics, we have what I call sales chances, which 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.

Chances climbed to 29 percent last month, up from 20 percent in February. In the spring of 2006 sales chances reached 28 percent, but they haven’t been close to that again until last month.

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