Throughout the year I have been tracking the market in this manner to see the changes in inventory and the "propensity of the market to sell". Since one would expect the market to sell unevenly from month to month, and more in spring and Summer than in Fall and Winter, I am using this "fan of sales" method to add more value to Absorption Rate statistics.

It sounds good in July to say "there are 3 months of inventory", but not accurate. Using the three months prior to determine absorption rates gives a false picture, as you can see from the below graph. Absorption Rate statistics is an area where hindsight does NOT have 20/20 vision.

Inventory today in this price range of $400,000 to $600,000 in King County is 3,997 on market vs. 3,386 on July 6, 2007. Properties currently in escrow of 1,030 compared to 1,657 on July 6, 2007 tells us that Inventory is up 18%, while pending sales are down 60%. Closed sales are down 45% comparing July to October.

In my next post I will compare July to October sales in this same price range for King County for 2005 to 2006 to 2007. One of the best things about "Stream of Consciousness Blogging" is that I don't know how these numbers will compare, and we all find out together.

Yesterday someone asked that I update the stats from THIS POST. 

Since we are past the year half mark, I will call OVERSUPPLY, any category with

 more FOR SALE than STI + PENDING + SOLD YTD.

OVER FIVE MILLION - 42 FOR SALE - 0 STI - 3 PENDING - 8 SOLD YTD (OVERSUPPLY)

$4M TO $5M - 23 FOR SALE - 2 STI - 5 PENDING - **8 SOLD YTD (OVERSUPPLY)

$3M TO $4M - 67 FOR SALE - 2 STI - 10 PENDING - 22 SOLD (OVERSUPPLY)

$2M TO $3M - 183 FOR SALE - 17 STI - 22 PENDING - 87 SOLD (OVERSUPPLY)

$1.75M  to $2M - 115 FOR SALE - 11 STI - 34 PENDING - 86 SOLD YTD

$1.5m TO $1.75m - *176 FOR SALE - 15 STI - 37 PENDING - 106 SOLD YTD (OVERSUPPLY)

$1.25M TO $1.5M - 247 FOR SALE - 20 STI - 68 PENDING - 216 SOLD YTD

$1.1M TO $1.25M - 189 FOR SALE - 11 STI - 54 PENDING - 187 SOLD YTD

$1M TO $1.1M - 101 FOR SALE - 9 STI - 33 PENDING - 100 SOLD YTD

Based on my observations of actual homes on market, I think the OVERSUPPLY in the $1.5 million to $1.75 million is being created simply because some people who should be in the category below $1.25M to $1.50M) are overpriced, which is throwing off the stats.  If you add these two categories together there is *No "real" OVERSUPPLY under $2 Million. 

That is the true purpose of running stats in this manner.  We can see from these stats, that some owners priced at $1.5 or slightly higher need to reduce their prices below $1.5 for the market to be entirely in balance under $2 million.

At the very high end you will always have more sellers than buyers, because over a certain price people will prefer to buy tear downs and build their own homes, before buying someone else's $Five Million Dollar home.  Same as new car vs. used car.

*Note that I have used the same method so that duplications are standardized, though not eradicated.  An agent will sometimes show a property as being in two different areas even though a property technically cannot exist in two places at the same time.  For instance, a property in Juanita might show as both Juanita (area 600) and Kirkland (area 560) since Juanita is "in" Kirkland.  Also, since I compile the stats using $3 mil to $4 mil and then $2 mil to $3 mil, a property at exactly $3mil would show in both categories.  Since we are looking for the up and down trends, these built in duplications should not affect the assumptions made generally from the stats.

I decided to go with YTD on the solds rather than 6 mos so when we are finished at year end, we have true 2006 figures.  In the original post I went a true 6 mos back into December of 2005.  As of today YTD would be a tad over 6 mos.

These are for all of King County compiled via NWMLS by hand.  Not by using the mls stat feature.  I do a preview count of every single sub-segment noted, which involves 32 separate and distinct searches. The mls will only go up to 250, so as the number grows in the sold between $1 mil and $1.25 mil, I need to break out into two categories of less than 250 homes.

**Of special note, the solds in the original post for 4 to 5 mil were obviously out of whack, so I edited the original post to change 22 sold to ? sold.  Since only 8 have sold YTD, that number must have included all statuses for that category or else there were a lot of them at year end of 2005.  Let's track it forward from 8 and disregard the original 22.

As with all stats, there are many ways to compile them.  As long as we stay with apples to apples, we are safe as long as we are tracking the trend and not being anal about the actual houses involved.  To remove the duplications for purity sake, would not be worth the time spent viewing each and every property to remove them.