March 2011 did see a decline in the number of pendings when compared to the shorter month of February 2011. The chart to the right is for existing homes in Rutherford County, priced between $100,000 and $400,000. Since pendings were up for February, it would make sense that closings would also show an increase in March, which indeed the graph displays. The good news I would take from these figures, however, is that most of those closings were the result of transactions that took 4 weeks or less.
In other words, your average short sale or HUD foreclosure that pended in February would not be reflected in the March number of closings, since they often take longer than a month to close (if they close at all.) Therefore, the rise in closings for March are more reflective of a recovering economy-- one not dependent upon short sales and foreclosures.
It is also important to keep in mind that the figures for February, March, April, and even May and June 2010, are reflecting the Federal government's tax credit that was a part of the stimulus package. One could reasonably say the chart's rise in pendings and sales during that time period is a false echo since the economy wasn't able to sustain that growth. Any current increase in sales should be more reflective of recovering economic conditions and confidence in stabilizing real estate values.
Next time we'll look at how new construction is faring this first quarter of 2011.
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