Focus On Newer Construction

This week I'm updating the activity on newer construction in our market. I first reported on these back in March (click here). As a quick refresher, what I mean by "newer construction" is a house built in 2000 or later, not counting homes offered or sold by the builder. Let's see what's new since I covered this a few months ago.

Our overall inventory has been declining pretty significantly for most of the year. The newer home segment of the market has actually bucked that trend. We have 17 of them on the market today, vs. 14 in March. Of these 17 homes, 3 of them are REO listings, and 9 are short sales. I'm actually a little surprised to see as many as 5 traditional sellers in this segment, because so many of these homes were sold at or around the peak of the market. Of the 9 short sales, 5 are contingent, so they're actually in contract. I didn't have notes indicating any contingent short sales in this segment back in March, so that probably accounts for the increase in inventory.

We have zero, zip, nada in terms of pending units in this segment right now. I would expect that a couple of those contingent listings should be in pending status soon. We've had 7 sales of these homes since the March post. 5 of those were REO's, one was a short sale, and one was a traditional seller. Not surprising numbers here. As I mentioned a few months ago, a lot of these were sold back in the days when prices were higher and lending guidelines were much looser, so I expect that short sales and REO's are going to remain with us for a while, maybe a bit longer than the market as a whole. The upside is, however, that these are still holding value this year despite the disproportionate number of distressed sales. I still think that when we start to see prices recover, that we'll see these properties appreciate better than the market as a whole.

Most of the second quarter sales should be reported by next week, so I'll do a second quarter report next week and update the price per square foot chart.