Sales Blog

As we enter the holiday season, it is a time of the year when our thoughts frequently turn to appreciation for the many things for which we are grateful. With the spirit of the season in mind, I recently looked at the island's real estate market to see what good things there might be to brighten our expectations for the New Year. I was pleasantly surprised to see the positive momentum that appears to be building among the major market indicators.

• The supply and demand curves are moving steadily toward the point where the supply of property equals demand. Currently, there is a 1.2 year supply of residential properties available for purchase. Historically, our local market can be considered to be in balance when a 9 month supply exists.

• Through October of this year, the number of residential sales has increased over five percent compared to the same period 2010 - another positive indicator.

• The average selling prices of both houses and lots appear to have stopped their precipitous declines in 2009. Since then, the selling prices of properties have remained essentially unchanged, forming a pattern consistent with a "U" shaped recovery. While studying the trends in the number of sales by price range, it was very encouraging to see the reappearance this year of home sales above $1 million.

• It was especially uplifting to see that the number of foreclosure filings for both homes and lots is down 25 to 30 percent from last year. Let's hope that this trend continues!

• At first glance, the fact that short sales and foreclosure sales have increased this year would seem to be the Grinch in an otherwise upbeat holiday story. However, if you think about it, the sales of distressed properties have fueled the market in recent years, decreasing the supply of properties for sale and, increasing the number of sales. At the same time, until the inventory of distressed properties is sold off, it will be difficult for prices to rise by any significant measure.

I think that you will agree that, all things considered, these trends offer a message for which we can all be thankful.

Best wishes to everyone for a wonderful Christmas and a very Happy New Year!