Negative numbers often conjure up negative images for me.

-40 degrees…means you are freezing your hiney off in some insanely cold part of the country.

-$50 means you just bounced a check at the local grocery store.

You know sometimes a negative number is a good thing….

-10 pounds…there aren’t too many people in the country that wouldn’t sign up for that.

-11% drop in Salem Oregon foreclosure notices…give me more of that, pretty please.  I’ll be nice…well, I’ll try anyway.  No guarantees.

I don’t think it is a big secret that foreclosures have been pulling home prices downward.  It isn’t a secret, right?  I don’t want my special real estate agent card revoked because I gave out classified information here…BUT for the first time in 5 quarters, the number of notice of defaults dropped by 11%, at least according to the information I get from Fidelity National Title Company.

Now that number is still…oh,  say…four times more than normal, but a drop now means that in a year from now we will see fewer of these properties hitting the market.   With our drop in unemployment here in Salem from the 11’s to the 10’s, it is possible that this downward trend will continue.

Right now 12.2% of Salem Oregon  listings on the WVMLS are designated as distressed properties (ie a short sale or foreclosure) and 11.1% of properties that sold in Salem last month were distressed properties.  It will take several quarters to bring these numbers back to normal, but it is nice to think of the possibility that we might be past the worst of those foreclosure numbers.  Unfortunately, one quarter doesn’t make a trend and we’ll have to see what happens in the next two quarters.

Home prices up?  What?

I have to say I was a bit surprised when I ran the real estate numbers this month for Keizer because the average and median home price ticked up.  Yep.  I said it.  Up. I know my regular readers would never believe I would say anything positive about real estate in our area.  I just proved you wrong

The average home price for Keizer Oregon for March was up 7.9% and the median was up 8%.   Now before any of you Keizerites get too excited about that news, it is just one month in the trend here.  I was fully expecting to see another mild decline like we had seen in the previous month, but some more expensive homes were able to be sold in Keizer this past month pulling that median up.   While I doubt this trend will continue through the summer it is a much better result than the large double digit drops that were happening in previous months.   That number coupled with a dropping inventory (at 8.7 months as I write this post),  are good signs for the Keizer real estate market.

Demand is up.  This isn’t a big surprise though.  That tax credit is nice.  Demand jumped 50% in Keizer for March.  This really helped to cut down the excessive inventory that was on the market.  Keizer continues to be one of the stronger markets in the Salem Oregon metro area.  While it has been impacted by the current economic woes, it continues to work towards stabilization and that coveted normal market.

Salem Oregon real estate market and home trends.

Well we are in the throws of a crazy spring as the tax credit eligibility ends here in just a couple of weeks.  As such buyers have been out much earlier than usual trying to take advantage of the tax credit.  So what did this dynamic do for our local Salem Oregon real estate market?

The median and average home prices are still dropping, but for now, the rate of descent has slowed. The average home price was down just a mere .20% from March of 2009, and the median home price was down 4.7% as foreclosures are coming on the market at competitive prices.

I had talked last month about the crazy high spike in inventory due to sellers putting their homes on the market much earlier than normal.  The inventory has dropped as expected, and while still crazy high, is at 15.3 months right now.  I fully expect this number to continue to go down as buyers start to soak up the inventory and close by the end of June for the credit.

Home sales ticked up this March compared to last year.  Sales volume has been up for several months, which is one factor that indicates we are slowing the descent and edging closer to the bottom of the market.   This doesn’t mean we have a healthy, normal market by any means, but we are showing signs of nearning that desired “bottom.”  Like I said before, I’m not willing to call a bottom until I see what the market does without the tax credit and the consequences of the Fed discontinuing buying mortgage backed securities March 31.  This summer and fall should tell us whether or not we are really starting to scrape along the bottom of our price drops here in Salem.

Keizer Oregon real estate trends

I chatted about the Salem Oregon real estate market a couple of posts ago, but let’s take a look at where the Keizer market is for February.  Technically homes sales were up in Keizer 42% in February 2010 over 2009, BUT this is just an increase from 7 last year to 10 this year.  It sounds better than it really is.  I really don’t want to put a damper on things, but I need to put the stats into context here.    This is still about half of what it should be.

The average home price dropped 8.6% year over year and the median barely shifted downward 2.3%.  Average home prices are being pulled down by the foreclosures and short sales in the marketplace, but the fact that the median hasn’t shifted much means that there is activity at more than just the lower home price level.  That part is good.  You want activity in all the market sectors for a good healthy real estate market.

Like Salem, the Keizer real estate inventory has skyrocketed as sellers jumped into the market very early to try and entice buyers looking for the tax credit to consider their home.  As such inventory has spiked up to 27.3 months in Keizer right now.  Remember that inventory numbers ebb and flow daily based on homes entering and leaving the market.  I do expect this crazy high number to come down as buyer start to purchase and fewer sellers list.

The good news for Keizer is that the distressed part of the market has stayed relatively constant in the past couple of months.   Distressed properties make up 10.3% of the active listing right now.  While that is a 10 fold increase from normal, in relation to other parts of the country, this is a pretty good statistic.

So what do I expect for Keizer in the coming months?

I still think home prices will have a mild decline here.  Good homes at good prices are still selling.  Homes in poor condition are not as cash investors are the only ones willing to take the duds that need a lot of work.  I’m starting to see some foreclosures sitting on the market as some of them are overpriced for condition.  Buyers are super conservative right now, so sellers you have to be on top of your game in order to sell right now.

P.S.  This data was crunched from the WVMLS.

Salem Oregon real estate market and home trend report

Today I saw a countdown for the home buyer tax credit to end:  50 days left to get under contract.  That count down has been so apparent this past month as the Salem Oregon real estate market started early.  Typically I tell clients that the market starts to heat up in April, but agents were running amok this month as things got busy much earlier than usual.

Sellers are out trying to get their home sold for the tax credit and buyers are out trying to get the tax credits.  So…where does all this frantic activity leave the Salem real estate market for February?

The average home price dropped 6.9% and the median 2.9% from February 2009.  Honestly, I think that is pretty good.  If the Salem market could stay around 5-6% drop this year, I think that would be a solid sign for the market.  The current inventory has spiked up to 19.4 months in Salem.  Normally, I would be very concerned about that spike, but inventory always rises over winter as there are fewer home buyers out. Obviously this is a huge jump, but it is not unexpected since sellers are trying to make sure their home is on the market for buyers looking to claim the tax credit.  This inventory number will continue to drop over the spring.  I just think we have an unusually high number due to this dynamic.

Sales are up 8.8% from February last year.   I would expect March and April to show increased sales volume as well.  The big to watch numbers, in my opinion, will be the summer numbers after the tax credit ends.

It appears for the first time in several months, that the real estate market will forge ahead without the tax credit and be allowed to start sorting itself out, unassisted…well sort of anyway.

All in all considering the high unemployment rate here, these numbers look pretty good.

Data was crunched from the WVMLS.

Last summer when we went to Bend for our summer vacation, true to form about 30 minutes into the car ride we got the yell from the back seat “How much longer?”  Every few miles we got the notorious question. I think it is a genetically programed question into the brain of every child to ask their parents every few minutes “Are we there yet?”  I know, you’re thinking what do my Saturday night ramblings have anything to do with real estate…Just bear with me here while I spin my thoughts…

Everyone wants to know if we have hit bottom. I think my poor crystal ball has been clasped so many times in my sweaty palms as I started into its depths in order to answer that question for every home owner and home buyer that asks. What my crystal ball says to me seems to be directly proportional to how much coffee I have had that morning though so I’m not sure if the crystal ball is really talking to me, or I should have gotten one less shot of espresso in my mocha that day…but back to real estate.

So what this graph shows is the year over year (ie Aug 08 vs. Aug 09) median price difference.  In this case a price drop.  It is my opinion that the median home prices didn’t drop as much in the 3rd and early 4th quarter as much due to the tax credit.  Buyers jumped in the market in much greater numbers than usual and caused the prices to remain higher than normal. With less buyers in the market, the prices plunged in December and January.  Now these are Salem Oregon specific real estate numbers.  The median home price plunged 21.9% Jan 2010 over Jan 2009.  This was inevitable to make up for the lack of correction earlier. I really don’t think the market is going off a cliff right now.

While it appears that the prices are declining rapidly, the flip side of this is the sales volume.  That big peak was of course the expected end of the tax credit.  Sales were up 6.25% this January over January 2009 and for the past 6 months each month had more sales than the previous year.  So that is a good trend.  Buyers are out.  The sales volume is still low, but positive is a good direction to go.    Not surprisingly, the percentage of sold homes that are distressed properties (meaning short sales or foreclosures) has been slowly creeping up.  I have no doubt that this will continue to creep up all year.  I’m hoping it tops out at about 25% but we’ll just have to see what happens as the year progresses.

So, what is the point of all of my rambling…well this is a very long answer to those of you that ask me “are we there yet? Is Salem Oregon at bottom?”  My answer to you is the same answer I give to my kids in the car…”we’ll be there in a little bit.”

P.S.  Data was crunched from the WVMLS.

Last one year end market report.    Whew…I need a break from data and I’m sure my regular readers are getting tired of data too!’

So let’s talk Stayton real estate.

Stayton has been struggling for a while and that hasn’t changed.  The inventory is currently at 36 months, which is high even for our normal slow months.  I wish I had better stats to share with you for Stayon, but I don’t.  If you want cheery news you’ll have to go to Aumsville.

So Stayton…

The average home priced dropped 11.9% to $192, 156 and the median shifted upwards 2.2% to $189,900.  I think the median shifted up as there were some more expensive foreclosures that hit the Stayton market, pulling the median up.   I don’t think that the Stayton real estate market is close to recovering or bottom for that matter.

I think it is still in a world of hurt over there.

I think this becomes more apparent when we look at the number of homes listed vs. the number of homes sold.  What is supply and demand looking like in Stayton?

Honestly, better, but not good.

The larger the gap between the red and blue lines, the worse the inventory and hence, supply and demand, are.

You can see we have clearly come off the peak, but things aren’t in any great shape.  From 2008, the number of homes sold dropped 10.9%.  Now that was offset a bit by a drop (28.2%) in the number of homes listed but supply and demand still aren’t working well together in Stayton.

So what does that mean for 2010?

Stayton home prices will have to continue to come down to correct the supply and demand imbalance.  Like Silverton, I would not be surprised at all, and in fact would expect to see, home prices drop another 10% in this area.  Inventory just isn’t getting eaten up fast enough to keep home prices stabilized.  Sorry Stayton home sellers.  I wish the trends were looking better for your area.

I feel off the data geek bandwagon here for a few days as I actually had to work…yes I really do negotiate offers and show houses on occasion.

So let’s talk Aumsville.

Aumsville ended the year at an average home price of $206,542  and a median home price of $209,500.  That average home price was a 1.5% INCREASE (I’m writing it in all caps, because it is the first time I get to write it) over 2008. The median, however, is down 5.2%.  The cause of this is due to the newer JDC subdivision in Aumsville, Highberger Meadows.  Several homes sold there, which are generally more expensive than Aumsville homes typically are.  The median which is the number where 50% are higher and 50% are lower is a bit more accurate for smaller towns since it swings less due to a high priced home selling.

Not that it means bad things for the Aumsville real estate market.

In fact I think good things, relatively speaking, are in store for Aumsville for 2010.  The same number of homes sold in 2009 as 2008.  Nice and flat.  What I really liked was the nice drop in homes listed.  A 30% drop in fact.  This nice drop has brought supply and demand much closer together.  Aumsville supply and demand has traditionally been very close and I think it still needs a bit of tweaking, but not bad.

I am interested to see how real estate does in Aumsville after the completion of the Home Depot distribution center.  With it’s easy access to the Mill Creek Industrial Park,  and the Cascade School District (generally speaking) getting better marks than East Salem schools, it will be interesting to see if the Sanyo Plant and Home Depot center keep Aumsville real estate going in the right direction. I’m kind of thinking it will.

P.S.  Data used in this report was calculated from information provided by the WVMLS.

Monmouth ended the year at an average home price of $180,887  and a median home price of $181,500    Monmouth home prices are about 11% higher than Independence and I think it shows in their year end numbers.    Monmouth has an 8.6 month inventory which is higher than Independence.

The average and median home prices did drop 12.7%  and 13.6% respectively from 2008 but it wasn’t enough.

Couple the drop in home prices with a 10% decrease in homes listed AND a 27.4% decrease in homes sold over 2008, and what you get is an ongoing supply and demand problem.  Last year homes listed versus homes sold was 55.4% in Monmouth and this year it was 45.2%.  Despite the number of homes listed going down, it just wasn’t enough.

Monmouth had been a fairly stable real estate market and while inventory is up, I don’t expect anything drastic for this small real estate market for 2010.  I would expect some ongoing price declines and Monmouth may correct another 5% or so, but it has one of the lowest rates of distressed properties on the market, 7.6%, in the Salem metro area.  Since employment in Monmouth is driven by the university, I wouldn’t expect to see a huge increase in foreclosures in this town.

P.S.  Data used in this report was calculated from information provided by the WVMLS.

What happens when you have low home prices, coupled with low interest rates?  Low inventory.  That is the situation occurring in Independence Oregon’s real estate market right now.  The inventory is at a nice healthy 4.5 months, which is nice to see.  The reason?  Low home prices.

The average and median home prices in Independence have always been almost exactly the same.  Independence ended the year at an average home price of $162, 874 and a median home price of $162, 000.    Compare that with some of the other metro towns and you can see that Independence is more affordable than some of the other Salem cities.

The average and median home prices did drop 7.4% from 2008 making Independence very affordable.

Couple the drop in home prices with a 12% decrease in homes listed AND a 16% increase in homes sold over 2008, and what you get is a supply and demand imbalance…corrected.  At least for now.  Right now, the data is indicating a nice healthy, normal, real estate market.  Now remember normal doesn’t mean a sellers market or a buyer’s market.  It means “let’s be reasonable” market.  Both sides need to put their sharkish “blood in the water” ways aside for a while.

So Independence ended the year on a good note.  There may be some ongoing mild price declines here, depending on unemployment woes, but I’m not anticipating any drastic changes to the Independence real estate market right now.  I would expect it to stay relatively flat in the 2010 year.   ‘

P.S.  Data used in this report was calculated from information provided by the WVMLS.