On 1-20-08, I did a cross property search in Savannah, an area bounded by East Anderson to the south, Bay to the north, MLK to the west and East Broad to the east. The properties include condos, single family, multifamily and a smattering of commercial properties that were listed in our MLS system. This does not include private sales that occurred outside of our system. There were a total of 355 sales in 2005, 275 sales in 2006, and 221 sales in 2007 so we can easily see that there has been a slowdown in this area. The drop off was not as bad in 2007 as it was in 2006 though. The question is, will we bottom out this year (the numbers seem to indicate the decline is slowing), will it get worse (a slowdown in the last ½ of 2007 as compared to the first half has some folks saying the situation is worsening rather than improving), or will we start to see some improvement in 2008 – a real possibility largely depending on the attitude of the buyers.

There is a tremendous amount of pent up need/want to purchase housing right now. Many, many buyers are sitting on the fence waiting to see what happens. With so many affordable rentals on the market and with some buyers themselves needing to sell before they can buy, everyone seems to be holding their collective breaths. With 526 active properties (for sale) in this search, it would appear that there is a two year supply of “inventory” out there. But it does not take an Einstein to visualize a year like 2005 which would certainly put a dent in that number although we must suspect many would-be sellers are waiting out there too. I like to compare the whole situation to a rubber band that is being stretched and the longer and harder we pull will affect the resulting release when we finally let it go – remember housing is a NEED not a want and Americans have this insatiable desire to control and own their own property – something you cannot do if you are a tenant. There are 21 units under contract (pending sales) in this search, an improvement over last month.

Here is to the power of positive thinking. Let’s make it great in 2008!

Until Next Week,

Ron Melander