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 This month we are seeing the usual trends we would expect for the time of year. With the summer coming to a close, we should expect inventory and sales to decrease - and we do see that.
However, inventory remains at a staggering high while sales continue to be at record lows.
As we have seen with previous months this year, home prices are again down when compared to the same time last year.
Read on for all the details.
Supply And Demand
Just as we have seen with the county in general, our inventory continues to increase when compared to the same time last year.
Inventory has increased 2.2% when compared to September 2006. That gives us a total of 277 homes currently available for sale in Morgan Hill.
Sales are down an amazing 30.8% from September 2006. Given the low sales we had in September 2006, it is amazing to see such a drop while the available inventory continues to rise.
That gave us a grand total of 18 homes sold in September 2007.
If sales were to stay at that level, we would have enough inventory to last us over 15 MONTHS!.
There is some good news in that fewer homes were added to the inventory this September 2007 than in September 2006. We saw a 33.6% drop in the number of homes listed. That was a total of 79 homes added to the inventory of homes in Morgan Hill.
When we look at the numbers going back to May of 2006, we can easily see the seasonal trends. The typical winter dip in the center. It also lets us see where there have been some deviations that don't fit with our usual expectations.
For instance, last years inventory peak was in August. This year, we peaked in June. A good argument for this is that many people were counting on the summer season and listed their homes in June. Sadly for those folks, the selling season actually came and went in May, leaving the summer months in decline which resulted in higher inventory as those homes did not sell.
From August to September, we saw inventory decrease 2.5%. That would be expected for this time of year. In fact, I would have expected a bit more of a drop.
Sales from August to September are down 37.9%. Again, we would expect a drop in sales at this time of the year, but this drop is even more than we would normally expect.
Home Prices
2007 is likely to be remembered as the year "it" happened. It is when the Morgan Hill market finally saw home prices drop in the face of huge inventory and slumping sales.
Perhaps one of the most telling charts that reveal this fact is the average home price graph. Look at that drop from September 2006 to September 2007. The average price of a home in Morgan Hill dropped 30.7%.
The median at about the same level tells us that there are as many homes selling over the average as below it. The average price of a home in Morgan Hill for September 2007 was $756,646. That is down from over $1 Million just one year ago.
The highest price a home sold for in Morgan Hill was $1,130,000. The lowest price was $451,000. That low price home was actually a repossessed property being sold by the bank. 
Even when we look at just the past few months, this months drop is pronounced. In fact, from August to september 2007, home prices dropped 20.1%.
I suspect that much of this is a result of the summer season that just did not perform as anyone had hoped. We now have a bunch of properties that must be sold, and sellers are biting the bullet to get their homes off their hands. Even if we go back to winter of last year, home prices are still lower now. While lower prices at this time of year are to be expected, this goes WAY beyond what most would predict.
September is a particularly revealing month. September of 2006 had the highest average price over the period shown and this September 2007 has the lowest. What a difference a year makes.
Days On Market
 Finally, we examine how long it is taking to get homes sold in todays market, versus the same month in previous years.
Once again, we find ourselves setting an unpleasant record. When compared to September of 2006, the time it has taken to get a home sold in September 2007 is up by 21.8%.
That gives us a total of 106 days - on average - to get a home sold. Remember, that is data that only pertains to the homes that have actually sold. As we know from the numbers, most homes are not selling and many have been on the market for over a year.
 I suppose we should be at least a little thankful. After all, it is actually taking less time to get your home sold in September than it did last month. In fact, when compared to August 2007, the time it takes to sell a home is down by 28.4%.
But again, so much of this can be effected by the nature of the homes that sell. We have so few homes selling that just one or two that have been on the market for a very long time can skew this average number.
In fact, from what I am seeing, if a home is priced correctly and marketed effectively, it can be sold in a very short time. I have seen some homes that get sold in just a few days.
Now more than ever, it is critical for todays sellers to carefully select the real estate professional they will work with to get their home sold.
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