Ada County residential sales in December were 6% higher than they were last December even though inventory, at approximately one month of resale and finished new homes, was down 7%. Pending contracts at the end of the month were 13% higher than at the same time last year, pointing to a good start for 2018.
For the year, unit sales increased 3% over 2016 and average prices were up 13%.
Notice in the graph below, the difference between inventory and number of units sold as well as inventory and average price. In 2006 and 2007, just before the housing recession, there was a relatively steady gap between number of units sold and number of units available for sale (inventory). At the end of 2017, the gap is quite large. What does this mean? Certainly the climb in average price has been caused in large part by the lack of inventory.
Also notice that the climb in unit sales seems to be leveling off between 2016 and 2017. Will that trend continue? Will it turn down? The most important number to watch is probably unit sales. If the number of units sold trends downward, we could be heading toward a housing recession. But the next recession could be interesting. It might bring us more inventory to choose from, a leveling off of prices and even occasiona spurts in sales.
2018 should be an interesting year in Ada County real estate!
Let's watch together.