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When reviewing the information about new construction whether permits, starts, or sales, if as many talking heads profess, that housing is “recovering” why are all categories 52 to 59% off the fifty year averages and down 72 to 76% from the peaks. And construction employment has dropped from 8,045,000 million people employed to 5,436,000 million people employed. The question i have to ask myself, if you go from no pulse in intensive care to a pulse are “recovering” or just not dead.
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actual total for year |
permit issued |
start of construction |
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multi |
single |
multi |
single |
single sales |
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2010: |
Year to Date |
604.6 |
447.3 |
586.9 |
471.2 |
323 |
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2011: |
Year to Date |
611.9 |
413.7 |
606.9 |
428.6 |
302 |
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year over year + or - |
1.21% |
-7.51% |
3.41% |
-9.04% |
-6.50% |
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seasonally adjusted |
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permits issued |
permits issued total |
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one unit structure |
includes multi family |
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permits issued |
413.7 |
611.9 |
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peak year |
1682 |
2219 |
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permits % drop from peak |
75% |
72% |
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50 year average |
911 |
1383 |
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permits % drop from 50 year |
55% |
56% |
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movement up from Bottom |
353 |
17% |
522 |
17% |
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housing started |
starts total |
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one unit structure |
includes multi family |
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starts |
428.6 |
606.9 |
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peak year |
1611 |
2357 |
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starts % drop from peak |
73% |
74% |
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50 year average |
1056 |
1481 |
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starts % drop from 50 year |
59% |
59% |
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movement up from Bottom |
360 |
19% |
520 |
17% |
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housing sales |
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one unit structure |
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new single family sales |
302 |
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peak year July 2005 |
1283 |
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sales % drop from peak |
76% |
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48 year average from 1963 |
628 |
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sales % drop from 48 year average |
52% |
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Bottom August 2010 |
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movement up from Bottom |
278 |
9% |
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2011 END OF THE YEAR REPORT
THE GOOD, THE BAD, THE DIRECTION
MY FIRST COMMENT ABOUT 2011 IS, I AM GLAD IT IS IN TH REAR VIEW MIRROR. MY BELIEF IS 2011 GOES INTO THE RECORD BOOKS AS THE LOW POINT IN REAL ESTATE UNIT SALES AND MOST PROBABLY PRICING IN THIS REAL CYCLE IN YELLOWSTONE COUNTY. THAT BEING SAID THAT DOES NOT MEAN A BOUNCE IN 2012. WHAT IT MEANS IS, MOST PROBABLY, STABILITY WITH A BIAS TOWARDS AN UPWARD MOVEMENT. THE MOST DIFFICULT ASPECT OF 2011 WAS THE FINANCING ARENA, ALTHOUGH RATES ARE INCREDIBLE, THE HOOPS TO JUMP THROUGH TO OBTAIN FINANCING ARE NOT INSIGNIFICANT AND LEAD TO DISCOURAGEMENT OF PURCHASERS DURING THE PROCESS. 2011 WAS THE HIGHEST RATE OF FAILED TRANSACTION THAT I HAVE EXPERIENCED IN MY THIRTY YEARS IN THE BUSINESS. I HOPE 2012 SLOWS THE CHANGES WITHIN LENDING PRACTICES TO GIVE MORE STABILITY AND CONFIDENCE TO PURCHASERS.
FIRST THE POSITIVES OF 2011. THERE ARE ACTUALLY THREE MAJOR POSITIVES THAT YELLOWSTONE COUNTY ENDED 2011 WITH, ONE IS INVENTORY 20% BELOW 2010 AT THE END OF THE YEAR, THE PENDING SALES BEING UP 17% AS COMPARED WITH 2010 AND LAST WOULD BE THE SMALL DECLINE IN UNIT SALES COMPARED TO 2010. WE CONTINUED TO SEE NEW HOME CONSTRUCTION DECLINE AND 18% DECLINE COMPARED TO 2010 AND A FALL OF 54% SINCE 2007. WHILE EXTREMELY DIFFICULT BUSINESS ENVIRONMENT FOR MY FRIEND IN THE BUILDING OF HOMES, IN THE LONG RUN THE SURVIVORS WILL BE HEALTHIER AND MORE PROFITABLE. LAST THE RENTAL MARKET SHOWS THAT GROWTH IS OCCURRING WITH YELLOWSTONE COUNTY WITH LESS UNITS AVAILABLE AND POSITIVE GROWTH IN RENTAL RATES. AS THE RENTAL MARKET CONTINUES TO STRENGTHEN THIS WILL CONTRIBUTE TO THE CONFIDENCE OF PURCHASERS SINCE AT THIS TIME THERE IS JUST $86 DOLLARS DIFFERENCE IN THE MONTH COST TO RENT THE MEDIAN HOUSE FOR RENT AS COMPARED TO PURCHASING THE MEDIAN PRICED HOUSE PAYMENT WITH TAXES AND INSURANCE. THAT DIFFERENCE IN 2008 WAS $391.
FINALLY I WANT TO THANK ALL MY GREAT CUSTOMERS FOR ALLOWING ME TO HELP THEM ACHIEVE THEIR REAL ESTATE GOALS IN 2011, ALTHOUGH A DIFFICULT, WITHOUT LOYAL CUSTOMERS IT WOULD HAVE BEEN A MORE DIFFICULT YEAR.
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Market update at glance |
Year |
Percentage Increase |
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Yellowstone County |
12/31/2011 |
2010 |
2011 |
or -Decrease |
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Residential Closed Sales Units |
1721 |
1675 |
-3% |
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Residential Pending Sales Units |
149 |
175 |
17% |
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Residential Active Property For Sale |
827 |
664 |
-20% |
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Average sales price Single family Home |
$212,730 |
$208,121 |
-2% |
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Average Square feet Single family Home |
2371 |
2372 |
0% |
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Median sales price Single family Home |
$189,250 |
$184,900 |
-2% |
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Median Square feet Single family Home |
2242 |
2222 |
-1% |
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Average Days on Market Till Offer Received |
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Single Family Home |
65 |
71 |
9% |
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Absorption rate - |
TIME IN DAYS |
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Time it would take for all existing |
186 |
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properties to sell with no new inventory |
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coming into the market place - residential |
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SINGLE FAMILY PERMITS MONTH |
11 |
11 |
0% |
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SINGLE FAMILY PERMITS YEAR |
240 |
197 |
-18% |
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Average # Rentals Advertised Sundays |
345 |
335 |
-3% |
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Average Asking Price Rental Home |
$1,041 |
$1,061 |
2% |
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Average Asking Price Rental Apartment |
$645 |
$657 |
2% |



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Here is the headline from yahoo financial news
Here are the actual numbers--- whom is trying to sell what to whom ? ---- swamp land comes to mind
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FOR IMMEDIATE RELEASE TUESDAY, DECEMBER 20, 2011 AT 8:30 A.M. EST |
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actual total for year |
permit issued |
start of construction |
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multi |
single |
multi |
single |
single sales |
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2010: |
Year to Date |
551.0 |
416.4 |
553.1 |
444.5 |
256 |
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2011: |
Year to Date |
561.4 |
384.4 |
564.9 |
399.4 |
236 |
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year over year + or - |
1.89% |
-7.68% |
2.13% |
-10.15% |
7.81% |
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seasonally adjusted |
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permits issued |
permits issued total |
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one unit structure |
includes multi family |
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permits issued |
435 |
681 |
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peak year |
1798 |
2363 |
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permits % drop from peak |
76% |
71% |
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50 year average |
920 |
1400 |
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permits % drop from 50 year |
53% |
51% |
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movement up from Bottom |
353 |
23% |
522 |
30% |
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housing started |
starts total |
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one unit structure |
includes multi family |
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starts |
447 |
685 |
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peak year |
1823 |
2494 |
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starts % drop from peak |
75% |
73% |
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50 year average |
1066 |
1495 |
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starts % drop from 50 year |
58% |
54% |
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movement up from Bottom |
360 |
24% |
520 |
32% |
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The national association of realtors has acknowledged that they have actually overstated home sales. They have also stated they are in the process of revising their methodology in coming up with their figures and will restate their “estimates” in the “near” future. To give you an idea of how their restatement may look here is an estimate of sales then two graphs on show the numbers below and one showing new single family sales to give a visual and actual bench mark for comparisons
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Here is what the adjustment to the NAR sales would look like using the HousingTracker data (this is NOT the NAR adjustment): |
Sales, as Reported |
YoY Change, as Reported |
Adjustment |
Sales, Adjusted |
YoY Change, Adjusted |
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2007 |
5,652,000 |
-12.7% |
-2.8% |
5,495,000 |
-15.2% |
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2008 |
4,913,000 |
-13.1% |
-4.5% |
4,691,000 |
-14.6% |
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2009 |
5,156,000 |
4.9% |
-10.0% |
4,642,000 |
-1.0% |
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2010 |
4,908,000 |
-4.8% |
-13.4% |
4,250,000 |
-8.4% |
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20112 |
4,950,000 |
0.9% |
-15.1% |
4,201,000 |
-1.2% |
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1An example of adjustment, this is NOT the NAR adjustment, 2estimate for 2011 |
Here is new single family sales as a bench mark comparison for you to decide what you think is the most likely scenario of home sales of the two sets of figure in the graph above

Thought to ponder which home sales market did you participate in?
neither is stellar yet one definitely shows a more stressful market
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The market positives inventory down and number of sales is closing the gap on 2010, prices are down about 3% year over year same time period.My belief is 2011 will go down as the low point in the market place this cycle and by the end of the 1st quarter we should be seeing year overyear increase in sales and at the minimum stable prices. this should help give both buyers and sellers confidence which will improve market conditions from both perspectives.
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Market update at glance |
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Year |
Percentage Increase |
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Yellowstone County |
11/30/2011 |
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2010 |
2011 |
or -Decrease |
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Residential Closed Sales Units |
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1601 |
1542 |
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-4% |
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Residential Pending Sales Units |
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193 |
198 |
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3% |
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Residential Active Property For Sale |
870 |
766 |
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-12% |
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Average sales price Single family Home |
$212,424 |
$206,330 |
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-3% |
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Average Square feet Single family Home |
2361 |
2356 |
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0% |
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Median sales price Single family Home |
$188,900 |
$183,700 |
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-3% |
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Median Square feet Single family Home |
2226 |
2211 |
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-1% |
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Average Days on Market Till Offer Received |
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Single Family Home |
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65 |
71 |
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9% |
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Absorption rate - |
TIME IN DAYS |
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Time it would take for all existing |
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190 |
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properties to sell with no new inventory |
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coming into the market place - residential |
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SINGLE FAMILY PERMITS MONTH |
16 |
20 |
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25% |
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SINGLE FAMILY PERMITS YEAR |
229 |
186 |
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-19% |
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Average # Rentals Advertised Sundays |
345 |
329 |
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-5% |
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Average Asking Price Rental Home |
$1,041 |
$1,065 |
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2% |
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Average Asking Price Rental Apartment |
$645 |
$658 |
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2% |
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