As noted in the prior post, the size-adjusted median actually experienced a bit of a monthly bump for the first time in 2 years:
The month-to-month increase for detached homes was just barely positive at .1 percent, but condos popped for 8.7% (though that number is less impressive in light of the whackage to the condo size-adjusted median in recent months).
The plain vanilla median bounced also, with detached homes up 1.5% and condos up 3%.
The Case-Shiller home price index is based on single family home sales, so this month’s data didn’t have too much effect on my little HPI proxy:
Volume was decent once again, beating out the prior two Aprils:
And inventory continued to decline… a phenomenon that has been much discussed on the Econo-Alamanc forum in recent months:
Months of inventory came in at just 4.9:
I’ve been keeping tabs on the disparate increase in condo vs. single family sales… here’s another way of looking at it, with months of inventory for each property type:
There were actually only 4.4 months of detached inventory, compared to 6.2 months of condo inventory.
Inventory, and especially single-family inventory, is really quite tight right now. Again, nothing new to the Piggs. There may well be a lot of new must-sell inventory in the future as a result of homes in foreclosure, not to mention homes that aren’t in foreclosure yet but will be. There is a lot of pent-up inventory (and pent-up must-sell inventory at that), though as discussed in a couple recent forum threads (here and here) there is some question as to when and even if that pent-up inventory will be released into the wild.
Whatever may happen in the future, the fact remains that as of right now inventory is tight. That’s just the reality of the situation, and the imbalance between short-term demand and supply is liable to put some upward pressure on prices.
The previous post discussed the potential causes and significance (or lack thereof) of the increase in the median-based price indicators, so I won’t rehash that all here. The summary is that in addition to the little run on inventory we have going, spring is a traditionally strong time of year for housing. In fact, spring price rallies are par for the course even during secular housing downturns — I imagine the only reason we haven’t seen many spring rallies in this particular downturn is because it’s been so brutal.
So even if the rise in the median price indicators represents a legitimate rise in actual home prices (versus a median disortion), it’s nothing to get too worked up about, except perhaps for the novelty that we finally got a month-to-month price increase. Watch that months-of-inventory figure, though. If the foreclosure dam holds and inventory remains this low for a while, things could get interesting.