Despite having one of the warmest Decembers on record, it didn’t help home sales. December sales were down compared to last year and there are a few other signs of a slow down.  China’s economy troubles certainly doesn’t help either. Let’s look at the details.

DEMAND: Demand in December was still strong, compared to the five year trend. It did end up with less sales than December of last year.  In and of itself, that doesn’t indicate anything. Let’s look at the rest of the indicators to see what they are saying.

SUPPLY AND INVENTORY ACCUMULATION: Seasonally, this number is right on track with where it’s expected to be, which is very low.  December is the month that most people pull their homes off the market for the holidays.  From here on out, inventory will grow.

SOLD TO LIST RATIO: For the second month in a row, this number lagged noticeably behind the same month last year. November was 0.6% behind and December 0.9% behind.  When looking at the overall ratio for the year, 2015 shows 94.80% where 2014 was 95.16%. This is something to take notice of.

RATES: Rates have jumped slightly in response to the Fed raising rates, though nothing to detrimental. FHA is still sub 4% and Conventional is around 4.25%-4.5%.

CONCLUSION: With China’s economy on very shaky ground and folks like George Soros saying that he sees signs of a 2008 slow down, there are a lot of signs pointing to a slow down. Locally, the stats are not showing that the market is as strong as it was last year.  The Sold to List price being down as well as the number of homes sold being down are signs of some level of a slow down.

For those thinking of selling in the next few years, if the market does slow down, they will be able to get more for their house this year than the next few years. It may be the right time to sell.

For buyers, rates are the “X Factor”. They are headed up and that can have a dramatic impact on what a buyer can get. Now is the time to take advantage of sub 5% rates.

In either case, we’d love to connect them with one of our specialists to give them the info they need to make the best decision.  If you or someone you know are looking to make a move, please give us a call at 484-696-4833.