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As weak as the 2006 housing market may have seemed sales volume-wise, 2007 is shaping up to be even weaker. Between March 2006 and March 2007, resale activity was down 13.5 percent for detached homes and 6.2 percent for condos.
Things look better on the supply side. Inventory for sale has increased in recent months, but not at anywhere near the pace set in early 2006. According to ziprealty.com, March condo inventory was actually down 12.9 percent from a year prior, while detached inventory was up 12.8 percent over the same period.
The months-of-inventory indicator simply divides a given month’s sales by the amount of available inventory, providing a rudimentary measure of how much demand there is to “soak up” available supply. As the chart shows, there was about a six-month supply of resale inventory on the market in March. Since March 2006, the supply-and-demand picture has actually improved a little for condos, but it’s gotten notably worse for detached homes.
— RICH TOSCANO