July home sales declined 47% since last month in a wild freefall, while marketing days increased 29% up to 129 days. July is also down 51% from 2007 and that July was the slowest July of this decade. All this to say there is currently no positive or even neutral trend with new contracts or closed sales on single family homes. Each of the last nine months has claimed the dubious honor of closing the fewest number of home sales in recent years.
The absorption rate (the number of months it would take to sell the existing inventory at July’s sales pace) jumped to nearly 24 months, double from June, representing the surge in unsold inventory. Spring and summer are normally the lowest inventory months—as few as three months in July 2005, the largest sales year historically.
Key Peninsula is absorbing its inventory slightly faster than Gig Harbor…an 18 month supply (297 homes), while Gig Harbor has a 27 month supply (749 homes). Key Peninsula is also experiencing a better ratio of sales price to list price…98% compared to 94.44%. This is in part explained by a lower median sales price ($267,000), a price slightly easier to finance in today’s uncertain lending world. Gig Harbor’s median is $398,000. Key Peninsula is picking up about 36% of the total sales; it generally produces about half of Gig Harbor’s total.
The most active price range is under $300,000 in Gig Harbor, with just a seven month supply of homes. This single range approaches a neutral market, considered to be six months. But for homes listed over $600,000, there are simply not enough buyers…eight for the 387 homes in Gig Harbor and four for the 46 homes in Key Peninsula in July.
CURRENT # MONTHS SUPPLY ON THE MARKET
Price range Gig Harbor Key Peninsula
All prices 27 18
<$300,000 7 18
300-399,999 16 18
400-499,999 26 25
500-599,999 46 9
600-699,999 93 ns
700-799,999 45 8
800-899,999 56 ns
900-999,999 36 ns
1-1,499,999 24 8
NS–no sales in this price range. There were no sales over $1,331,800.
