- May 3, 2024
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There are several different ways to measure the housing market. I’ve referenced absorption rates in past columns. But absorption rate lags two months behind the market because sales are measured when they close, not when the sales contract is signed.
In 2009, I introduced a new way to measure the housing market — one that overcomes the delay in measuring sales. I named it the GINNdex, after Bobby Ginn becuase of his impact — good or bad — on the local market. Although several of Bobby’s projects were over-envisioned and crashed spectacularly when the bubble burst, the Hammock Beach Resort is a success. It is the largest generator of local tourism dollars.
The GINNdex is the ratio of inventory to sales contracts (both pending and contingent). Because it measures contracts, it is more “real time” than closings. It reflects what is happening today rather than what was happening two months ago. Like the absorption rate, it can be used to measure different segments of the market. Like the absorption rate, a low number indicates more activity than a high one.
I live in Tidelands where sales activity is currently brisk. There are 17 units for sale and 15 sales contracts. The GINNdex would be 17/15, or 1.13. High activity can be seen in the lender-owned home market too. Many lender-owned properties go under contract within days of being listed, often for prices above the listing price. Currently, 48 are available and 64 are under contract, giving a GINNdex of .78.
The GINNdex for all Flagler County Multiple Listing Service single-family homes is a more normal 1.99 (1008/507). Since more than half of all Flagler home sales are depressed sales (lender-owned or short sales), we would expect the GINNdex to be lower for less expensive homes and higher for upscale homes.
The median selling price of all single-family homes sold through MLS in December was $115,000. The GINNdex of those below the median is .84. For those above the median, it’s 3.0. For homes listed over $500,000, the GINNdex is 7.9.
Condos show a similar pattern, but the condo market is still more sluggish than the home market. The GINNdex for all condos is 3.8. For those listed below $100,000, it’s 1.49. For those listed above $500,000 it’s a staggering 16.3.
The GINNdex for Hammock Dunes condos is 9.2.
The new measure can also be used to compare locations. The GINNdex for Palm Harbor is 2.6, while Pine Lakes is 1.8. The difference reflects the higher list prices for salt water canal lots in Palm Harbor. Palm Harbor has 96 listings above $200,000, while Pine Lakes has only 24.
