Improvements in Indiana Real Estate are Evident
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The local real estate market is healing. We’ve just released the new edition of Carpenter Reports, and we see some very positive signs in the Indianapolis and central Indiana housing market. Listing Inventory continues to decline. This decline is needed for the market to get back into balance … to get healthy again. Inventories of single family homes for sale are down in the fourth quarter by 29.9%. Johnson County leads the market with a decline of 36%, followed by Shelby County with a 33% decline. Marion County, as the largest county for inventory saw a nearly 30% decline.
The national and local economy continues to make improvements. That continued improvement reflects on the housing market. The trending numbers during the fourth quarter of 2011 are positive. Pending sales during the fourth quarter were up nearly 14% year-over-year with Shelby County leading the way with a 51% year-over-year improvement followed by Hancock County with a 28.3% improvement in the fourth quarter. Marion County experienced a solid 14.1 growth of pending sales.
The average residential sales price for closed sales in central Indiana remained relatively flat to down slightly. The average for the 11 county area was down by 3.6% from the same period last year. Again, Shelby County led the list with a 14.7% decline. Hamilton, Johnson and Madison Counties saw an increase in their sales prices year-over-year in the fourth quarter. We believe we will begin to see a firming of prices and growth in the averages as the year progresses.
As we have discussed before, consumer confidence is one of the two critical elements in driving home sales; mortgage interest rates being the other. Mortgage rates are now at a record low level; currently below 4%. Consumer confidence, as measured by the Consumer Confidence Index (CCI), rose sharply in both November and December from historically low levels. The January index drifted down only slightly, but held the gains from the previous months. As consumer confidence grows, the demand for housing will grow with it.
At Carpenter, we continue to believe we will see gradual improvement in the local economy, in consumer confidence, and in housing going forward. Bumps in the road are to be expected, especially in an election year, but we believe the improvement will be relatively steady going forward.
Posted by: 
David Caveness
