I predicted in a Las Vegas Review-Journal article that we were nearing the bottom of the market last November. Wow, did that shake some people up. I received emails from a number of my clients stating that they thought I was crazy, and asking how we could be nearing the bottom when prices were still dropping. Yes, prices are still dropping ... but since you really only know that prices are rising after the fact, you've already missed a great opportunity if you wait for statistics that are 30 days old when you see them.

I am more confident than ever that we are at the bottom of the market in terms of sales. For the 11 months ending in October 2007, the number of sales decreased every single month. In November, sales were flat. Based on several factors, I predicted we were nearing the bottom and that, even with an expected holiday slowdown, we would begin to see sales rise early in 2008.

Sales of "resale" homes (single family residences listed on the MLS) in Las Vegas have remained flat for November, December and January. In a market that was devastated by decreasing home sales for nearly a year, flat is good. But it gets better, because pending sales are on the rise. I am going to make another bold prediction: I predict that, barring an apocalyptic event this month (such as mortgage products disappearing), February sales will be higher than January sales.

My clients already know my secret: I don't make guesses based on my feelings. Our research is real-time, not based on another firm's stats released at the end of the month. (My researcher can beat up your researcher.) So while I'm going out on a limb in predicting that February sales will be higher than January sales, I'm merely extrapolating using today's statistics.

It's simple supply-and-demand logic that once demand is rising, prices will follow. Perhaps sales will remain flat for several more months; I predict that they will continue to rise. We are seeing pending sales rising in what are traditionally the worst sales months of the year. In March or April, these sales will begin to show up in the statistics as escrows close.

In other words, the general public will be reading news stories that sales are rising soon. I work hard to keep my viewers on the cutting edge; I don't want our clients and viewers to hear about opportunities once they've passed. When prices begin to rise, I'll let my viewers know. In the meantime, I'm stating it once more: We are at the bottom in terms of sales. How long until the pendulum swings?

[Email Blogger]