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 It is a mix of good and bad news for May of 2007. The real estate market in Morgan Hill has seen sales increase, but the inventory has gone up as well. Also, despite what we have seen over and over in the market, the homes that are managing to sell are selling for amounts higher than they did last year. Read on for all the details.
Lets take a look at the number for May of 2007 for Morgan Hill.
Supply and Demand
 Inventory is up 20.7% from the same period last year. There are 268 homes in inventory. That gives us about 6 months worth of inventory, assuming these inventory and sales numbers remain constant - not a good bet.
On the up-side, sales are up 29% from the same time last year. In total, 44 homes sold in Morgan Hill in May 2007.
The graph really gives a good indication of what inventory numbers have done over the last few years. Very steady increase.
 If we take a look at these same numbers for recent months, we see that the inventory is up 11.2%, just from the previous month of April. An increase like that is to be expected as we head into the summer season.
Over the last month, sales have increased by 17.6%. That is encouraging, but may not tell the whole story. An increase during this time of year is fairly normal and may not be an indication of a larger trend.
Home Prices
The average home price continues to increase. It is interesting to note that the increases have slowed substantially. In May of 2007 we saw only a 2% increase from the same time last year.
If we see a continued flattening or even a decrease in average home prices, that could be the catalyst that draws more buyers into the market.
Also interesting to note is he 5.1% drop in the median home price. This tells us that more homes below the average price are selling than those above.
 When we look at the same numbers for previous months, we see that once we compensate for seasonal effects, the overall trend is down. However, the average price of a home in Morgan Hill increased by 10.8% from the previous month.
Days To Sell
The days it takes to get a home sold just seem to continue to increase. It is now taking 65 days, on average, to get a home sold in Morgan Hill. That is an increase of 18.2% from the same time last year. At that time, it was taking about 55 days to sell a home.
Despite this big increase, it is not the longest it has taken to get a home sold in recent years. Back in 2003, it was taking 76 days to get a home sold during the month of May.
 Looking at the short term changes over the last few months, we see some encouraging signs. The days to sell is actually down 19.8% from last month.
If the summer season really kicks in, we will see this number continue to drop. However, the big indications of whether or not this summer season is a boom or a bust will be revealed by average price and a big drop in inventory numbers.
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