TOM Begins To Behave Himself
September
is a transition time for almost everybody. Here in Salt
Lake City and Beyond and across the US, the kids have shifted into school gear, adults
have moved out of vacation mode, and businesses are already sprucing up for the
(believe it or not) Holiday Season.
In real estate, we are looking with more than casual
interest at what’s going on nationally. Especially those measures that tend to
affect local home sales. The largest
professional association in the country is our own National Association of
Realtors®. At the beginning of the month, they broke another piece of welcome news.
This one looks like the difference between ‘indicators’ of a strengthening home
sales market -- and signs that it’s already fact.
The
NAR release was about TOM. No, as you have probably guessed, TOM isn’t some
real estate broker’s name -- it’s the Time On Market measure. For local homeowners who are selling (or planning to
sell) their properties, it’s a vital measurement of one of the two most
important characteristics of how things are going – a tip to what they may
expect when they list. Along with median price trends, it tells the story of
whether the market is hot, cool, or somewhere in between.
For
some years now, TOM has been an uncooperative sort of fellow. At least when it
came to Utah home sales. Following the
financial crisis came skyrocketing foreclosures…then the fallout from that --
painfully long TOMs marking the lengthening time it took to move homes through
the market. TOM had stretched out to a painfully long median of 98 days – close
to the longest ever.
The good news: TOM is just about
back to normal. From the cyclical peak hit in 2009, by mid-summer, he was back
“in the range of historic norms for a balanced market.” Traditional sellers were reporting the median
TOM had returned to the balanced range of six to seven weeks. IOW, TOM is
finally behaving himself.
And what about that other half of
the picture that helps guide home sales expectations?
I
think it’s too soon to tell for sure, but the head economist at NAR knows what
history tells us to expect when this kind of balanced market returns. According
to him (Lawrence Yun), “Our current forecast is for the median existing home
price to rise 4.5% to 5% this year.”
Plus another 5% in 2013!
So the transition that September
means for everyone else seems to be underway in the real estate world: and it’s
a transition back to home sales normalcy. In light of what we were looking at a
just couple of years ago, I think it’s fair to say we are delighted that
‘normal’ is the ‘new normal!’
Article
Written By ShirLee McGarry, Freelance Writer/Author and Realtor® at All
American Realty in Sandy, Utah
www.Homes4SaleUtahRealEstate.com
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