As the parents in your neighborhood know, we are back to school!
For some, a welcome relief . . . for others, a sad event as they look at their growing young adult and wonder where their little baby has gone.
I may be more of the latter, just saying. Now that the kiddos are back in school, we can get to focusing more on adult things . . . like home ownership.
For most of us, our homes are the largest asset we’ll ever own—so you are right to want to understand this asset and the market you are in.
You deserve an expert guide. Here are the top things you need to know:
Overpricing is Rampant, as Days on Market Increases
Based on Average List and Average Sold prices this month, our Average Over-Pricing is at approximately $45,000! Yikes!
Case in point, let’s explore a real-life perfect example of this scenario.
Three model matches are listed for sale around the same time frame, in the same neighborhood … one priced at market value, another slightly higher, and the 3rd $40,000 over market comps.
The one priced to market value sold for list price in 11 days.
The one priced slightly higher sold for slightly under market comps in 32 days.
The one listed entirely too high, dropped the price $30,000 and then sold for slightly under market comps in 41 days.
Check out this chart ... we see that homes are selling at 98.4% of list price, lower than we’ve seen in the last three (3) years.
Parallel to the overpricing frenzy is an increase in Days on Market.
Average Days on Market for the entire MLS has increased every month this year. Starting at 15 days in January 2019 and now at 22 days.
We know that homes that are priced correctly will receive competitive offers quickly and homes that are not, tend to sit.
When we look at homes that have been on the market for over 30 days, we find that the majority of those homes are overpriced.
Currently 63% of the homes for sale have been on the market for over 30 days and are without offer.
Image courtesy of Stephen Mohammed, Broker in Ontario, Canada.
Median Sales Price Stabilizes While Total Home Sales Try to Catch Up
Last month we saw our 1st increase in Median Sales price in over 3 months, coming in at $304,000, but our overall number of Homes Sold was down over 11% from last month and last year.
This month, our Median Sales Price for single family homes is about the same, down only .3% to $303,000.
We did sell 8.8% more homes this month than last, but still leaving us shy of last year’s numbers by 0.8%.
Overall stability of the market is exceptional. Our Median and Average Sales prices still remain below our 2006 peak.
In July, the U.S. economic expansion that began in June 2009 became the longest in the nation's history, marking 121 straight months of gross domestic product growth and surpassing the 120-month expansion from 1991 to 2001.
The average rate of growth during this expansion has been a modest 2.3% per year compared to 3.6% per year during the 1990s.
Long and steady growth will always be better for our economy than a sharp, drastic incline.
While we expect the economy to perform well for the rest of 2019, most economists see a mild recession on the horizon. Let me reiterate… mild … and not due to a housing crisis.
Real Estate Market Highlights
|Single-Family Home Stats
||2019 vs. 2018
|Median Sales Price
Up 4.5% YoY
|This month our Median Sales Price for single family homes is about the same as last month, down only .3% to $303,000. Our Median and Average Sales prices still remain below our 2006 peak.
|Number of Single-Family Homes Sold
Down 0.8% YoY
|8.8% more homes sold this month than last, but still leaving us shy of last year’s numbers by 0.8%.
|Months on Hand / Months of Inventory
Up 64.5% YoY
|Down 8.2% from last month. With our slow June, we expected an uptick in units sold in July. The number of new listings is down 2% since last month, ergo bringing inventory levels down.
|Average Price of New Listings
Up 2.7% YoY
|Based on Average List and Average Sold prices this month, our Average Over-Pricing is at approximately $45,000! Currently 63% of the homes for sale have been on the market for over 30 days and are without offer.
|Average Price of Homes Sold
Up 8.1% YoY
|Currently single family homes are selling at 98.4% of list price, lower than we’ve seen in the last three (3) years.