Happy New Year, etc. etc. There are plenty of predictions about the next year in the housing market, and I’m going to do my best to ignore all of them. But there is (and will be) plenty of actual data to look at.

First off, there’s some good sales news from Calculated Risk. Specifically, it shows that not only are sales increasing (as we already knew), but much of that increase is coming from conventional sales as opposed to distressed sales.

For example, as economist Bill McBride put it, while NAR reported that sales in general were up 14.5% in November (year over year), conventional sales were actually up almost 21%.

Further…

Also note that the percent of distressed sales over the last 6 months is at the lowest level since mid-2008, but still very high. This is the lowest percent of distressed sales for November since 2007.

Related to that, McBride also looked at the ratio of sales of new homes compared to used existing homes over the past 18 years or so.

Before the market collapse — going back at least to 1994 — for every new home sold there were about six existing-home sales. I.e., there was a 6:1 ratio of existing to new homes.

Thanks to all the distressed homes hitting the market starting in 2008-ish though, that ratio shot up as new homes took a hit. From late 2009 until mid 2011, more than 14 existing homes sold for every new home. 

Since then, though, the ratio seems to be declining. As McBride explained,

In general the ratio has been trending down, although it increased over the last few months with the recent pickup in existing home sales. I expect this ratio to trend down over the next several years as the number of distressed sales declines and new home sales increase.

Eventually we’ll (probably) get back to that 6:1 ratio of existing to new homes, and — coincidentally — to a lower percentage of distressed sales. But that’s going to take time. The recovery is still a work in progress.