Wednesday, May 28, 2008

It Only Gets Better From Here

One of my favorite local cheerleaders is Realtor and Happy Valley developer Tony Marnella. Despite being called out on this blog before Tony still churns out the propaganda. This time around Tony is proclaiming April as the bottom of the Portland housing downturn.
Tony writes:

Another great article that vindicates a lot of what many of us have been saying was written recently. The Wall Street Journal published an article written by Cyril Moulle-Berteaux on the 6th of May. This article nails it!
It states that April will show that it was the bottom of the housing decline. We feel that in our sales offices and what we hear amongst our peers. Buyers are starting to feel a bit more confident and are starting to revisit the housing market. More positive news like this Wall Street Journal article and our local new channel 6 had a great story about the Portland housing market last week all help rebuild the confidence that has been lacking in our market place. We still hear plenty of negative press, but we will always hear that. When the market turns around then it will be bad press about how unaffordable it is. Most of the naysayers won’t find anything positive no matter what direction the market goes. However, for the rest of us it is improving.
Ever it be so slowly, it is improving.

Tony attributes the recent uptick in traffic to conversations with his sales team and peers. We’ve seen this card before from local realtors. Back in March when Vancouver sales were at a 20 year low the executive director of the Clark County Association of Realtors said, ‘We’re hearing reports that more people are attending open houses and inquiring about property.”
Unfortunately those reports never showed up in the sales data and Tony’s claim will be proven just as valid.
The article addresses the fact that home inventories have been falling over the past months. Here in Portland, RMLS reported that we had 12.8 months of unsold inventory in January. By March we were down to 9.1. We have seen an increase back to 10.1 in April however; an increase in inventories is historically in line with this time of year.

If Tony mentions the increase from March to April is normal then why doesn’t he mention the reduction from January to March is also normal and expected? Maybe he just forgot so I’ll show it here.
Oh and since the months of supply is a ratio (total inventory/monthly sales) we should look at total inventory too. It paints a very different picture.

We have seen a 6.8% increase in pending sales from March to April. Of course, all that will be referenced by the naysayers in their blogs and stories is that sales are down from last year with no mention of the increase in sales month to month since December of last year.

Who do you think the naysayer is? We know he reads this blog.

Real estate is a seasonal industry and Tony knows this; sales bottom in December and peak in June. The fact that sales increased from December to now is just as news worthy as the sun rising in the east this morning. I’ll let the sales graph explain what the current market really is like.

The National Association of Realtors has also just reported that, “buying a house in the Portland metro area is once again affordable for a family earning the median income.” All the more reason to get into this market now and stop listening to those who continue to say the sky is falling in spite of the facts that things are improving.

Most Realtors in town distance themselves from the NAR’s real estate porn. They know how easily refutable the cheery press releases are and don’t want to get caught pushing it.