The Dog Days of Summer

The familiar expression, "The Dog Days of Summer," has evolved over centuries to describe the long, hot, sultry days when everyone lacks the energy to do much. Imagine swinging leisurely on a hammock, trying to escape the oppressive heat. I’m sure that’s what the Romans did.?

The phrase?“Dog Days” originated in the Roman Hellenistic period, referencing the heliacal rising of the “dog” star system, Sirius. This period, now from July 3rd to August 11th, was associated with heat, drought, thunderstorms, lethargy, bad luck, and even the superstition of dogs going mad.?

"Dog days" perfectly captures the current real estate climate. It's scorching hot, and while dogs aren't going mad, humans certainly are. Far too many countries are embroiled in intense disagreements about everything under the sun. Pun intended.?

Despite all the rancor and persistent doomsday predictions of an imminent housing crisis, home sales continue to defy expectations. Like a broken clock, which is right twice a day, there might be a sliver of truth in these negative forecasts—but only a sliver.?

Interest rates remain stubbornly high at 7%, presenting buyers with the double whammy of limited inventory and high rates. Yet, sales have continued, and median sales prices have remained stable, even inching upward most months.?

The chart below shows median home prices in Orange County from 2019 through June 2024. Last year, median prices fluctuated quite a lot as buyers grappled with high prices and high rates. The days to sell shot up from 2022 into last year, as interest rate shock hit buyers. This year, median prices have remained flat for the last three months, which is unusual for summer. Days to sell, however, remained incredibly low by historical standards.

Concerns and Trends?

Median prices surged from January through April, then stalled. This mirrors 2022, raising some concern. The relationship between active listings and sales is subtly changing. Having missed the market shift in 2022, I'm hyper-vigilant in analyzing inventory data. I detest being wrong, particularly when it could cost a client money.?

The following chart shows relative inventory levels. While active listings aren't much higher than sales, a trend may appear. Or it could be yet another blip like last year.?

In June, the number of sales equaled 38.08% of active listings. Pre-pandemic, this was typical. Not anymore. In May, it was 44.16%; April, 41.38%; March, 32.82%; and February, 32.82%. Typically, the sales ratio?increases in peak summer months. This?June it dipped below April, which is far earlier than expected, considering sales closed in?June entered?escrow many weeks before.

....continue reading report here: https://open.substack.com/pub/wendyhooperross/p/the-dog-days-of-summer?r=1r8ory&utm_campaign=post&utm_medium=web