The Park City housing market’s “absorption rate,” which
estimates how long it will take a house to sell, has fallen for the seventh month in a row. The absorption rate hit a high of 41.26 months in August of 2009. Currently, there is only a 27.29 month supply of inventory – a noteworthy sign suggesting that we are moving into an improving, more active real estate market. What has been a strong
buyer’s market over the past year could be moving back towards a more balanced market, signaling that the window of opportunity for buyers may soon be closing.

To say that activity in the Park City housing market has increased from the same time last year would be an understatement. During the first quarter of 2009, just 167 transactions took place in the greater Park City area (the lowest quarterly transaction total in 20 years). By comparison, 325 closed during the first quarter of 2010, nearly a 100% increase.

The 12-month rolling average (of the number of houses sold in the Park City area) jumped last October and has increased steadily since, marking the first time there has been sustained positive growth in the rolling total of units sold since November 2005. The 12-month rolling total of dollar volume has seen an equally impressive jump during the past six months. The rolling total volume sold in March reached $1,021,240,993, up 19 percent over the previous year.

Yet another significant statistic, and one that supports the hypothesis of a bottom in housing prices, is the 12-month rolling average of the single family home median sales price. Over the 18-month period of April 2008 to September 2009, the median home price fell 27% – from $710,000 to $500,000. That price has now remained flat for seven months, further indicating that housing pricing has found a bottom.

An additional indicator of a housing market’s strength, or weakness, is the number of foreclosures and notices of default taking place. In the first quarter of 2007, just two foreclosures occurred in Summit County. That number has increased every quarter since, reaching a high of 134 in the fourth quarter of 2009. In the first quarter of 2010, the number of Summit County foreclosures dropped to 81, a 40% decline. The number of notices of default also dropped, from 205 in the fourth quarter of 2009 to 177 in the first quarter of 2010, a 14% decline. Lower numbers of foreclosures and defaults are strong indicators that the economy and housing market have started to recover.

It is also worth noting that the foreclosures and notices of default in Wasatch County, adjacent to Summit County, declined in the first quarter of 2010 over the forth quarter of 2009. Foreclosures dropped from 65 to 61, and notices of default fell from 129 to 94.