Pending sales are eclipsing done deals as the best gauge of the housing market, Realtors said, as financing and appraisal obstacles apparently slow otherwise brisk sales.
Realtors handled 1,189 home sales here last month, down 2.9 percent compared with February 2012, according to the Oklahoma City Metro Association of Realtors.
The drop was puzzling, since every other major statistic was positive: The interest rate was better for buyers, an average of 3.64 percent, more than one-tenth cheaper than a year ago; the average sales price was $160,255, up 5.1 percent; and houses sold in an average of 87 days, about a week faster than in February 2012.
Keith Taggart, president of the association, dug deeper into the numbers and found a wad of transactions that were taking longer than usual.
The number of listings that went under contract last month but did not close was 1,747 — up 19 percent from a year ago and an increase of 60 percent compared with February 2011.
Pending sales last month were 25.9 percent above the five-year average for February: 1,372, Taggart said.
So, the dip in closed sales doesn't concern him as a gauge of the market.
“These (pending) numbers are more reflective of the feeling I get from the market activity right now,” said Taggart, managing broker for Coldwell Banker Select's office in Mustang. “Perhaps the dip in the numbers closed has to do with problems with financing and appraisals.
“Everyone is very busy. Everyone is so happy with the market. Our business is up 15 percent over this time last year.”
Pending sales hit a record of 750 in Edmond last month, said Brian Preston, an agent with RE/MAX Associates Realtors who compiles a monthly market report. In fact, he said, there were more sales pending for houses between $100,000 and $200,000 than there were homes listed for sale but not under contract.
Taggart pointed to two other factors affecting the “feel” of the market:
February ended with 6,548 houses listed for sale, 11.7 percent down from a year ago. Taggart said that was a 4.4-month supply — well within the range of what is considered healthy for the market.
Further, he said, multiple offers “have drastically increased” — but those aren't tracked.
Homebuilder Caleb McCaleb said he has been selling lots of new homes to newcomers moving in to work for Devon Energy, Chesapeake Energy, Continental Resources — and Boeing Corp.
“We're selling a bunch to Boeing engineers,” McCaleb said of his Edmond neighborhoods.
Preston said Edmond is seeing something of a shortage at some prices.
“The updated homes are selling like hoecakes in certain price ranges,” he said. “We have multiple offers on these houses when they do come on the market because buyers are seeing the homes that are currently on the market that need updating or are in poor shape.
“We also have sellers inflating their prices because of the market and buyers are overlooking these. We cannot get the appraised value on these.”
For their part, homebuilders are still responding to demand by rushing to meet it with supply, although less than desirable appraisals are slowing financing, said Mustang developer Robert Crout, president of the Central Oklahoma Home Builders Association.
Through February, Oklahoma City, Edmond, Midwest City, Moore and Norman issued 804 permits for single-family buildings, up 16.8 percent compared with the first two months of 2012, the association reported.
“It seems to me like this past four or five years of slowdown, I think people were doubling up. Family units were staying together,” Crout said. “It seems to me there are more family units out there — kids who were living with their parents now can go out and have a home of their own. People who can get out and have a home of their own are (doing so), because they can.”