The Housing Market is Getting Better. Consumer Confidence is the Drag.
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We’ve just published the latest edition of Carpenter Reports: The Central Indiana Real Estate Market, a quarterly review of central Indiana real estate market activity. For reasons you’ll see in the report, I’ve titled this edition “The Housing Market is Getting Better. Consumer Confidence is the Drag.”
Why? I believe this quarter’s report continues to illustrate that the central Indiana housing market is in a recovery. Any argument that now is a great time to buy a home is more compelling today and that this report supports that.
Over the last quarter almost every county in central Indiana saw lower inventories of single family homes for sale, a necessary and healthy sign of recovery. Six had double-digit declines. With that, we noted double digit increases in sales for the third quarter. With the exception of Shelby, Putnam and Madison Counties, all central Indiana counties experienced solid double digit increases. Again, evidence of a recovering market. Stabilization, and gradual improvement in the Average Sales Price of the homes sold is another key indicator. Compared to the third quarter of 2011, this quarter showed a healthy 2.7% increase in the Average Sales Price.
With these numbers, we anticipate positive comparisons for the fourth quarter of 2011 and early 2012 as the recovery continues to build momentum into Spring.
The biggest challenge to a sustained recovery in central Indiana’s housing market continues to be consumer confidence. The downward trend in the monthly Consumer Confidence Index continues to put a drag on the housing recovery. Despite favorable prices and interest rates, many prospective homebuyers simply lack the confidence in their personal situation to undertake such a major purchase.
At Carpenter, we believe there will be gradual improvement in our housing market over the next few quarters and for years to come. It won’t be a straight-line to recovery. There will be bumps along the way. It will take improving consumer confidence in what the future has to offer to assure us the sustained recovery we all need and want.
Posted by: 
David Caveness
