A couple months back I did a post on market share by price range (will be doing another update on that hopefully in the not to distant future), and today I’m going to take another stab at market share, but this time from the angle of unit type.
You’ll want to click on this one to get a closer look, she’s a big’uns!
This is broke into single family homes, condos and townhomes. As we can see, SFH’s dominate the landscape, no surprise there. By this measure townhouses look to only make up about 5% of the market (give or take 1% any given month), but I’m not exactly sure where the line is between condo and townhouse, seems a lot of the latter get grouped in with the former, but I digress.
Going off on a short tangent, these three make up the vast majority of what is announced as “residential sales” each month… though not quite all of it. There is another tiny fragment that comes from vacant lots and mobile homes. For example, last month there were 2,552 “residential sales” of which, 2,506 were from SFH, Condo’s and townhouses… so those other 46 sales came from somewhere, but are fairly immaterial to the stats as a whole. In anycase, they are not included in any of the calculations presented her.
Anyway, back to the graph. Now you may be wondering what the shaded area is. Basically it is the level where we would typically expect the market share of SFH’s to be. It is based on the numbers I had from 2000 up until 2006 when the boom started… we had a mean of 69.5% (also the median fwiw) for SFH (conversely Condos/Townhouses combined for 30.5%, obviously), and a standard deviation of roughly 2%. So, the shaded area is the area within one standard deviation of the median.
As we can see, it held up true to form through 2006, and has largely returned since the boom ended…though that could be a sign that a slight downward shift may be called for going forward as there was a disproportional number of condo’s built during the boom.
What is interesting to note, that while we’ve been hearing the last couple of months about how many more SFH’s have been being sold, proportionally they are still in line with what we’ve seen historically, and even over the prior year during an extended period of poor sales overall.
The major observation I take from this though is the massive increase in activity in condos/townhouses during the boom. They went from typically making up about 30% of sales, to making up as much as 44.1% in March of 2007.
Really quite a remarkable change from a statistical perspective as that’s over six standard deviations from the predicted path… even recalculating standard deviation just using information presented on this graph it is still over three.
Assuming a normal distribution, the odds of one result that far out varies between extremely low (less then 1/370) to astronomically low (less then 1/500,000,000)… and we had several results in that territory.
Obviously there was nothing normal about the bubble. Also reaffirms that there was a whole lot of speculation going on, and it’s going to be very hard to clear out all that, especially now that proportional sales appear to have returned to their norms.
I’m going to try to take a slightly different look at this figures, and give you all a look at the hard numbers of sales per unit type, and how they changed during the boom. But alas, that will have to wait for another day as I’m off to the football game. Have a good weekend.