There's no way to be certain what 2012 will bring. However, a few things do seem clear enough to make some assessments. First, 2011 was not the recovery year it was expected to be. It was yet another "transition year" for most. Second, multi-decade low mortgage rates and suppressed home prices coalesced to form an attractive purchase environment. And buyers did just what their name implies. This has driven down inventory levels in many locales, which—thirdly—nudged the market balance toward equilibrium. Here's how the final month of 2011 concluded the year.
New Listings in the Contra Costa region were down 8.9 percent for detached homes and 30.9 percent for attached properties. Pending Sales increased 33.6 percent for single-family homes and 56.1 percent for townhouse-condo properties.
The Median Sales Price was down 7.2 percent to $515,000 for detached homes and 5.7 percent to $200,000 for attached properties. Months Supply of Inventory decreased 38.1 percent for single-family units and 64.1 percent for townhouse-condo units.
Ultimately, the upcoming spring market should be a major tell about the future direction of housing. Sellers are seeing multiple-offer situations; buyers are seeing sub-4.0 percent loans; supply-demand trends are more balanced. When it gets down to it, that's a stable foundation and a far cry from 2009. While the fundamentals are better, the foreclosure situation and political unknowns remain wildcards. For now, enjoy the fresh canvas.