Our report is completed for May 2009. And I am happy to inform that amidst the doom and gloom, there is still a positive direction for the market.

With regards to single family resale homes, we have seen closings grow from 183 units in January to nearly double that, at 363 units in May. This surpasses May of last year by 12 units.

Average home prices jumped by $8,000 for Resale homes.

Canyon County and Ada County resale closings have risen consecutively for 5 straight months. Canyon County has more than doubled its closings from 74 units in January to 170 units closing in May. These are very promising numbers!

Ada County Resale inventory has dropped as well as Canyon County. This is the most important element in the overall recovery of the housing market. Supply and Demand!!! The trend for closings will continue for resale homes, as the pending sales are up for the 5th straight month.

Distressed property inventory is holding steady for Resale. The increase in sales has kept these numbers in check.

We have a slightly different scenario for New Home sales. Both counties are down with regards to closings. There are two challenges for new homes: higher than normal levels of resale homes and the shear absence of new sellable inventory. Many of the new homes left are the unwanted children. Much of the most desirable homes are gone and banks are still not willing to ease restrictions on builders at this time. This is helping to feed the resale market! For the builders that are in a position to put inventory up, they will possess a distinct advantage if they have done their homework and put the right product up, at the right price, in the right location.

We will probably see Ada County New Home inventories drop below 500 units. Canyon County could drop below 200 before the year’s end. I do not even have records that go back far enough to show inventories at this level. We would have to comb through the records at the MLS and maybe find levels this low somewhere in the early to mid 1980’s.

We are running at a 5 month supply of New Homes for both Ada & Canyon County. This is hard to believe given our current market conditions. In spite of this, pending new home sales are up by 43 units. A good portion of this is most likely build jobs! Most of the distressed New Homes have been cleaned up!

We are very fortunate compared to other parts of the country. I believe Moody’s is correct in their assessment of Idaho. We will become healthier quicker than most of our Western neighbors. Idaho is still a great place to live and what has always drawn people to Idaho, and the Treasure Valley, continues to bring people and investments here!

We simply need to survive as we are in a recovery and we are making good progress. There is hope out there!!!   

If you would like a copy of this report, please e-mail me at mikepe@johnlscott.com.