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VOL. 125 | NO. 240 | Friday, December 10, 2010

November Home Sales Slide 24 Percent


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The Shelby County housing market continued to tumble last month, with November home sales falling 24 percent compared with the same month a year ago.

On a brighter note, the monthly average home sales price improved a bit, both from November 2009 and from October.

A total of 876 homes in Shelby County were sold in November, down from 1,152 homes sold in November 2009, according to the latest data from real estate information company Chandler Reports, www.chandlerreports.com.

Last month’s tally also marked a 13 percent decline from 1,011 homes sold in October.

The total dollar volume for November’s home sales was $113.2 million, a 21 percent drop-off from $144.1 million for the year-ago period. November’s dollar volume also was down 7 percent from October’s $122.1 million.

Real estate agents were quick to point out at least one reason for the disparity between November 2009 and last month.

“For that decline from November to November, you have to remember that we had the tax credit last year, and people were hurrying to take advantage of that,” said Landis Foy, managing broker for Crye-Leike Realtors Inc.’s Quail Hollow office.

Although the tax credit was eventually extended, buyers didn’t know that would happen until late in the game and rushed to close on their homes before Nov. 30, 2009. That’s why Foy thinks the year-to-date figures are more telling – but even those show a dip.

Year to date, Shelby County home sales were down 7 percent, with 12,415 homes sold through November compared with 13,331 homes sold through November 2009.

Meantime, in November the average home sales price for the county was $129,266, a 7 percent improvement over $120,804 in October and a 3 percent increase compared with $125,084 a year ago.

The biggest increases in prices were seen in seven areas: Eads, Collierville, Germantown’s 38138 ZIP code, East Memphis’ 38117, Bartlett, Southeast Shelby County and Downtown.

One reason for the price increase was due to the number of foreclosures, or bank sales, continuing to fall in November, as they have been all year.

There were 221 bank sales for the month, a 35 percent decline compared with 342 in November 2009, and a 29 percent decline compared with 313 bank sales in October.

Traditional, or non-bank sales, totaled 655, a 19 percent drop from 810 in November 2009 and a 6 percent drop from 698 in October.

Neil Hubbard, principal broker with the Germantown office of Prudential Collins-Maury, attributes the increase in home prices to the exit of these distressed properties from the market. As the foreclosure bargains are snapped up, that leaves more conventionally priced homes on the market.

“As these distressed properties are being sold, more of them are moving out of the marketplace,” he said. “That’s helping to boost home prices in those areas.”

Realtors point to several other factors that come into play in the current environment, including sellers who are forced to come to terms with the realities of the competitive market. They tend to be lowering their prices to be competitive, or if they are not willing to go lower, taking their homes off the market.

In terms of the submarkets with the most activity, Frayser’s 38127 produced 75 sales with a total dollar volume of $1.4 million. Yet Frayser had one of the lowest average home sales price averages in Shelby County at $18,717.

At the other end of the scale, Collierville’s 38017 was the most lucrative ZIP code with 74 home sales averaging $312,626 and totaling a county-best $23.1 million.

The highest average sales price was in Eads’ 38028 at $601,833, followed by Germantown’s 38138 at $359,050 and Germantown East’s 38139 at $333,787.

Sales of new homes for the county last month totaled 57, with an average home price of $235,083 and total dollar volume of $13.4 million. Sales of existing homes totaled 819, with an average price of $121,901 and dollar volume of $99.8 million.

Sales of both new and existing homes declined from the same month a year ago, and few industry professionals see quick relief from the current decline in housing sales.

“I’m hoping we’ve hit bottom, but even though I am an eternal optimist I do think we have some more foreclosures and short sales to deal with,” said Linda Sowell, president of Sowell & Co, which specialized in homes within the I-240 loop. “That’s just a cold, hard reality.”

PROPERTY SALES 98 172 17,556
MORTGAGES 101 194 20,229
BUILDING PERMITS 223 349 36,295
BANKRUPTCIES 52 115 11,279