St. Louis Real Estate Market-Is it improving?
Using the best residential data available from the MLS, there are a number of reasons to conclude that the St. Louis Real Estate Market is improving and will continue to do so in 2012.
First, consider that the inventory of homes for sale is significantly reduced compared to the start of 2011.
Including St. Louis City, St. Louis County, St. Charles County and Jefferson County, the January 2012 listing inventory for residential homes is down by 1230 homes or 10.9%. That trend has continued for the past 8 months on a month-to-month comparison.
For the same criteria and time frames, sales (closings) for January 2012 are up 18%. Closings have been up for 8 months in a row on a month-to-month comparison.
Looking at a slightly larger time frame and comparing the 4th quarter of 2011 to the 4th quarter of 2010, closings are up 11% even though the average inventory during the same period was down by 11.3%.
Can we expect it to continue?
On the short range, the best evaluation of buyer demand is probably measured by showings on listings.
Showings for Prudential Select Properties listings are up 28% for the first 40 days of 2012 versus 2011. Undoubtedly, our mild temperatures has helped that activity to some degree, but not likely to the 28% degree.
Finally, we can make one more observation about the market in 2011 versus 2010.
During 2010, the $8000 Tax Credit Incentive Program was in full force for closings during the first half of 2010. Millions and millions of dollars were given to first time homeowners as an incentive to buy a home. In 2011, there were no government incentives in place for home buyers. In spite of that major difference, the total sales in the same 4 counties discussed above were as follows: 18,820 sales in 2010 versus 19,189 sales in 2011.
More homes were sold in 2011 without any artificial financial incentives available. Reduced prices and historically low interest rates were the driving forces encouraging homebuyers.
2012 is already gearing up to be a great year. Banks are loosening up credit again and more homes are going on the market.