Inventory Data for 5 MonthsPosted on Wednesday, September 12th, 2007 at 6:17am.
All of this information is drawn from our twice-monthly MB Market Updates, and reflect end-of-the-month data snapshots. Also, we made several adjustments to the data that were first published in the updates – failed escrows and canceled listings that return are, respectively, eliminated from the "newly pending" data and added back to the "active listings" data, as appropriate.
For even more nerdy detail, check out this new post at our sister site/data-dump, where we've published the data in 2-week increments instead of monthly, and we provide section-by-section graphs for the 3 regions west of Sepulveda. There's some discussion of the data there, too, that you may find interesting.
What's the story here?
The first issue is sales activity. Unlike many MLS-based reports, MBC is not publishing data on sales that closed in a given month, but rather on listings that went into escrow in a given month. This is more of a real-time measure. (Others do this for much broader regions.)
All we have to rely on now is these 5 months, but what we saw was a drop by 52% in sales versus the previous monthly average number of SFR sales (21) in this west-of-Sepulveda region. This figure happens to be in line with reports that Los Angeles County saw a 50% drop in sales in August comparing year-over-year, not month-by-month, in 2007.
Indeed, the drop in our subject region appears to have been more than twice as bad (-58%) as the county-wide average of 25% down from July 2007. But, alas, we must beware small samples – these are quite small samples.
Also, look at sales versus new listings. In just one month (July) did the number of sales exceed the number of new listings coming on the market. While more homes were added than were purchased, inventory remained largely level because of cancellations (not shown). This suggests an overall balance, with no obvious excess in supply or demand at this time.
Eventually you will want to look at newly pending sales as a percentage of the actives. This is often expressed as the number of months' supply of homes on the market. We seem to have averaged about 3-5 months' worth of inventory, though August (beware small samples!) ballooned to 7.7 months' worth.
Compare our "problem" with inventory to that in Moreno Valley (far east on the 60 fwy.) – 59 homes sold there in August, with 2,200 on the market – just about a 3-year supply. Achem. We're not there.
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