Home Inventory In Cincinnati; a 24 Month Review - Time to Upgrade
I was talking to a real estate agent yesterday and we discussed the inventory of homes in the greater Cincinnati area. I was very surprised to hear them terribly concerned about their perception that there are 11 months worth of homes on the market right now. I questioned his concern and did some research on my own at Housing Tracker.
The short story is that there are 64 more homes on the market today than there were one year ago, 1/2% more inventory than in 2006 and 1.8% more inventory than 2005. Now it is true that prices have gone down slightly; for the median home the drop since 2005 is 3.35% and for higher priced homes 4.45% over the same time period. Lower priced homes have dropped 5% since 2005 but also did not experience the price spike and hard correction that the median home and luxury home experienced.
What this translates to is that if you are in a median priced home it is the best time to move to a bigger space if you need to. I know it is against everything that we have been hearing on the news but the reality is that the price of the home you want is closer to selling price of the home you have right now. Math does not lie - the difference between a median and high priced home this week is $90,000. One year ago that difference was $97,000 and in 2005 the difference was $94,302. In real dollars upgrading is ALWAYS a good move in a down market. If your Cincinnati real estate agent is not telling you this they are just plain wrong.
Week Inventory 25th Percentile Median 75th Percentile
11/28/07 11,415 $99,900 $149,900 $239,900
11/28/06 11,351 $104,900 $158,000 $255,000
11/28/05 9,418 $104,900 $154,900 $249,202
Tags: Cincinnati Real Estate, home buyer, home seller, home values, Property Value
This blog entry is factually flawed.
According to your own source, housingtracker.net, which BTW tracks ASKING prices, not SELLING prices, the inventory of unsold homes for sale by MLS in Cincinnati is:
12/2007: 18,479
12/2006: 17,178
That’s a difference of +1301, or +7.6%, not the +64 and +.5% you site. That is a tremendous jump. I’m not sure where you got that data from either as you quote the inventory as 11,415 as of 11/28/2007.
Regarding upgrading to a luxury home for $90,000, since when is a 240k home considered “luxury”? 240k will barely get you a 3 bedroom, 1 bath home in East Hyde Park. I wouldn’t call that a luxury home. Following that logic, I suppose I should buy a Mercedes instead of a Honda if the Honda has decreased in price less than the Mercedes?
In any case upgrading isn’t an option for a lot of people since the credit market bubble has burst, and it requires selling your existing home first in a stagnant market.
More more thing, commenting on your blog was very difficult. The moveable type create new account feature didn’t create an account, and even after going to typekey.com and creating an account there, it still will not authenticate from your blog. To comment using openid required creating an account at wordpress.com, creating a blog at wordpress.com, and staying logged in at wordpress.com before I could login to comment at your site.
Britton I am sorry you had a hard time commenting. I’ll look into it. I know MT can be cumbersome at times to get an account. We are trying to encourage openid and again I’m sorry that it gave you such a hard time.
You make a great point. Luxury was probably a less than ideal word choice. And you are right some areas you can barley get a bungalow for $240K, but in the suburbs you can find 4 bedrooms and 2 baths for that. I am not suggesting upgrading for the sake of up grading, but if you have 5 kids a Mercedes and a Honda do an equally bad job of taking them all around, you need a bigger vehicle. I am going to edit the post to better reflect my ideas. As far as the incongruity in the data … I cut an pasted the char right off of the website. The hyperlink was straight to metrics page but if it is Java based it may give you a more general landing page.
I got the root of the discrepancy. The number that you are quoting in your comment is for the greater Cincinnati-Middletown area and the numbers that I quote in the post are for Cincinnati. They are two different reporting areas in the website.
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