New housing inventory heading below-1,000 mark

Only 116 new-housing projects in the county at end of third quarter

By Roger Showley

Wednesday, October 27, 2010 at 6 a.m.

As the housing market nears its annual holiday hibernation, the new-housing sector has approached the sub-1,000 mark, according to MarketPointe Realty Advisors.

In its third quarter report, the local consulting firm found only 1,002 unsold homes on the market, two-thirds of which are attached. Two years ago, there were 2,622 units and last year at this time, there were 2,000.

"The fourth quarter stands to be an important one for trending," the company says. "All of the ingredients are present for a strong quarter: historically low mortgage rates, lower inventory levels with no new product being built, and steady pricing."

At the end of the third quarter, there were 116 new-home projects, one more than in the second quarter, but 20 less than a year earlier and down from 241 in the third quarter of 2008.

The sales rate was .32 unit per week, down from .55 in the second quarter as buyers were hoping to take advantage of tax credits. The sales was .43 in the third quarter of 2009 and .17 in the third quarter of 2008, when the subprime mortgage meltdown and other economic issues were roiling the market.

Pricing in the third quarter averaged $564,229 or $388 per square feet for attached homes, but MarketPointe said that figure was inflated by the large number of high-priced condos that sold downtown, where the average of $662,756 or $500 per square foot. Outside downtown, the attached average was $472,419 or $300 per square foot.

For detached housing, the average price was $603,744 or $212 per square foot.

The overall average price, combining both attached and detached, was $249 per square foot in the third quarter.

That compares with $248 in the second quarter and $251 in the third quarter a year ago. The price has stayed within a narrow range except for a spike to $287 in the fourth quarter of last year.

MarketPointe reports a weighted average of beginning home prices, not counting lot premiums and upgrades. The prices reflected opened escrows not closed sales, which can delayed for several months if construction has not yet been completed.