Serving Bellingham & Whatcom County
Coldwell Banker Bain
Tom DeRose :: Wireless: 360-220-9355 :: Email: tderose@coldwellbankerma.com
Housing Market Cycle
Posted on January 8, 2010
This graphic shows the cycle of housing sales and sale prices through decreasing sales and lower prices, through recovery of the housing market.
Up arrows indicate increasing prices or number of sales. Sideways double arrows indicate no change in price or number of sales. Down arrows indicate decreasing prices or number of sales.
Up arrows indicate increasing prices or number of sales. Sideways double arrows indicate no change in price or number of sales. Down arrows indicate decreasing prices or number of sales.
Note that the price of homes generally lags behind the number of sales. In a downturn, the price of homes remains up or even decreasing, but the number of home sales drops (Phases 3-5). Then, after both number of sales and sale prices are decreasing, sales will begin to level off and increase (Phases 6 and 7). Finally, prices will level off and begin to increase (Phases 8 and 1)
Typically, recovery is driven by the number of sales. This is what is generally happening in the market now. The number of transactions compared to a year ago is up, but prices are still declining (Phase 7). So we should look ahead to see if prices stabilize (they are showing signs of doing so now), and we will complete the cycle into a full recovery.
Typically, recovery is driven by the number of sales. This is what is generally happening in the market now. The number of transactions compared to a year ago is up, but prices are still declining (Phase 7). So we should look ahead to see if prices stabilize (they are showing signs of doing so now), and we will complete the cycle into a full recovery.
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