It's July 30th, 2010 and I've been tracking Des Moines real estate market activity since 2008. In 2009, I began to follow and record Pending transactions on a daily basis. Pendings refers to an accepted offer between a buyer and seller and is a temporary status of a real estate transaction.
When a home is listed for sale, it is labled as "Active" meaning it is available for showings and the seller is waiting for an offer to purchase to be brought to them. When a buyer and seller agree on a purchase price and other contingencies of the offer, the property status is changed to "Pending" or "Sale Pending". The Pending Status can last from a couple of weeks up to more than a couple of months, depending on the laundry list of things that need to happen before a buyer is willing and/or able to close on the sale. The third status of a real estate transaction is called the "Sold" or "Closed" status. This is when the buyer completes the purchase process, typically by sitting down with their mortgage lender and signing dozens of papers promising to repay the mortgage and finally presenting a check to the seller for the amount of the purchase. The real estate transaction is over for practical purposes at this point.
The chart that you see updated on this website each week represents the number of Pending Transactions recorded on each day in 2009 and year to date in 2010. The picture above is a slice of the Current Pending Sales Comparison chart. You can download the full PDF report by Clicking Here. But for now, here's what the different lines and colors mean.
First, the blue line. This is the daily record of Pendings in 2009. Every Friday I mark where the activity was for that same date in 2009. This lets you see whether we are ahead or behind last years activity when looking at 2010 data.
Next you will notice that there is a Red and Yellow area chart. This is the 2010 Pendings. The activity is red as it progresses through the year until the point at which 2010 Pendings were ahead of 2009. Once 2010 Pendings dipped below 2009 levels, the chart changes to Yellow. This is to give you a quick visual of whether we are ahead or behind 2009 activity.
Note that on May 3rd, 2010, we hit the high point of Pendings at 2,159 transactions "on the books". Coincidentally, this was right at the end of the Federal Tax Stimulus program that ended on April 30th. So naturally with the incentive ending, Sale Pendings begin to drop off.
This trend has continued until around the second week of July when Pendings stopped falling and the market began to pick back up again. To the uninformed consumer, one would make the assumption that the real estate market is very slow and perhaps even well behind where it should be from last year. If we had not had the tax stimulus, then this assessment would be correct, but what we saw in the Des Moines real estate market was that much of the real estate activity that would normally have occurred throughout the summer was accelerated to prior to the April 30th deadline for the stimulus.
You can see that business is now levelled off and staying around that 1,100 number of Pendings. We are behind last years numbers of Pending transactions as shown on this chart, but remember the tax stimulus was in effect then as well. It may take the rest of this year before we know if we are truly ahead or behind.
In the meantime, keep checking back at my website http://www.remarketpulse.com each week for an updated Pendings chart.