October holds to prevailing model

RealTrac’s October numbers are in and it’s more of the same: residential sales way off while land sales continue to hold their own.

First the good, or better, news. Year-to-date land sales are actually up, with 102 parcels sold through October, compared with 98 through the first 10 months of last year. October, though, saw a small dip, 7 sales now, 8 a year ago. Consider the market in terms of dollars only, and it’s a much different story. Average selling price in October just $34,214, compared with $91,100 October 2007. through the first 10 months of the year, the average selling price for land was $51,115, compared with $78,028 a year ago.

Do the math: using these year-to-date averages, there was $7,646774 in land sales in 2007, $5,213,730 in sales through October 2008. That’s a $2,433,044 decline in dollar volume. Use 6 percent as an average commission rate for reference purposes, and there’s been a decline of $146K in earning power for area real estate agents from land sales alone.

Now for home sales, way off from 2007. Year-to-date sales have declined 36 percent here—228 sales through October last year, against 145 now— although the average selling price has increased $21K, $159,425 compared with $138,352 through October 2007.
Even with those average sales increases the decline in total unit sales has had a telling effect on earning power.
Total dollar volume through October 2007: $31,544, 256.
2008: $23,116,625.

That translates into a dollar decline of $8,427,631. Under the six percent commission model, there’s a loss of $505,658 in potential income for area real estate professionals.... not to mention the decline in all business and professional services activity generated by each closing.

October home sales merely reflected the yearly trends: only 14 units sold, compared with 27 a year ago., a 40 percent decline, slightly offset by a 10 percent average increase in selling price to $159,239.

One cautionary note: numbers here only reflect sales of DeKalb County property listed with our multiple listing service(MLS). In today’s trying economic times, some people are trying to sell their property themselves. So while MLS activity may be the best picture we can draw on the state of the market, it’s not the whole picture.