Looking back over 2009 so far, you can see some interesting trends in what is selling in the Golden Isles. I took a peek at mainland Brunswick and broke the sales figures down to seller controlled sales and other entity controlled sale (such as banks, asset management co, relocation) and the trend sort of tells a story…
Take a look at this graph:
Over this past year, the mainland areas of Glynn County has closed anywhere from 21 to 52 homes. Yes, that’s way down from 2008, but such is the market. Of those sales, as you can see, the year started almost neck in neck with regular (that is to say, Seller controlled) to Corporate controlled sales (meaning banks, relocation companies etc.).
You might notice, however, that as the year wore on, the number of corporate controlled sales dropped from running about 48% to levels more in the 30% range of overall sales. What does this mean? It probably means that the Federal First Time Homebuyer Tax Credit impacted general sales, improving regular seller controlled sales. I also think that the drop in seller controlled sales in November so far may be indicative of the holiday season’s approach and the extension of the Tax Credit into next year. The pressure is off for now, leaving the bargain hunting investors to pick up the foreclosure deals where they can find them.
The other thing to note here is that there is a directly proportional relationship to price points. All the national statistics have reported that re-sale home prices have gone up steadily over the last three quarters. Well, this sort of goes hand in hand with my graph. I noticed in my analysis of the Brunswick market that the lower the home price range I was looking in, the better the odds that they would be mostly foreclosures. As I moved into homes in the $200+ range, foreclosure rates dropped and then $400+ were very rare (although there were some out there!). So as first timers bought regular homes, they stayed in the higher ranges of home prices… if this is the case, this might explain increases elsewhere.
Based on that, I can see how the foreclosure sale dominated market would make it seem as if home prices in general are down – but what I noticed around here in the Golden Isles is that a good chunk of the homes under foreclosure and owned by the banks are already in a lower price range to begin with. It’s not as if $250K homes are selling for $70K… it’s more like a proliferation of $90K homes selling for $70K bringing overall housing sales figures down. There are just more of those foreclosures than there are of the $400K foreclosures, so the numbers will be skewed that way. Get it?
It’s amazing what the numbers can tell you… Stay tuned for more as I delve into the Island side of things!
