Real Estate Market Conditions
(As reported December 2006 by Shirley Enders)
ACROSS THE NATION
Throughout most of the country as well as on this beautiful sandbar called Cape Cod, buyers have had more choices due to a larger inventory of homes, sellers are more willing to negotiate and some who are extremely motivated are offering incentives adding up to a buyer’s market. However, the media is now indicating that buyers, who have been waiting in the wings for the best opportunity, have decided “NOW is a good time.”
Following are just a few of the many links from the economic gurus watching the market and verifying what we as Realtors are beginning to see as more and more homes are “pending” in all price ranges even during the holiday season – traditionally one of the slowest times for real estate sales.
Greenspan Says The Worst Is Over For Housing - November 28, 2006
http://www.realtor.org/RMODaily.nsf/pages/News2006112904?OpenDocument
Pending Home Sales Confirm Market Is Stabilizing - Daily Real Estate News - December 4, 2006
http://www.realtor.org/RMODaily.nsf/pages/News2006120401?OpenDocument
Realtors: Slump to end in ’07 - Boston.com (The Boston Globe online) – by Bloomberg News – December 12, 2006
http://www.boston.com/business/globe/articles/2006/12/12/realtors_slump_to_end_in_07
CAPE COD
Across Cape Cod, the number of sales of both detached single-family homes and condos eased throughout the 1st three quarters (January through the end of September).
Nevertheless, it is also clear that Cape Cod has remained a very desirable place for many to own a home – whether a primary residence or a second home. So far, while the volume of real estate sales is down significantly and we have seen significant reductions in asking prices, the final sales prices have refused to drop in correlation with the reduced demand. For example, while the number of single-family homes sold in the 3rd quarter of 2006 was -25.4% from the same period in 2005, the median asking price from the sale period in 2005 was only -3.5% across the Cape. And this is the 1st decrease in median for 2006! The 1st quarter median was level at 0.0%, the 2nd quarter was +2.5%! And while the year-to-date volume of sales is down for condos, the median sales price is still seeing a positive increase.
What these numbers indicate is that, while we have been in the process of a market adjustment, we are not seeing a big “bubble burst” as many had predicted. Once adjusted for the market conditions, most homes on Cape Cod are selling between 93-98% of final asking prices. Why is that? Many Cape Cod home sellers are 2nd home owners. Many don’t NEED to sell. Many have opted to withdraw their homes from the market or to simply “be patient” once they have adjusted the price to fair market value.
For home owners who do wish to sell in the current market, those who have owned their properties for a while will see a very good return on their financial investment (not to mention the emotional benefits they received from home ownership). They should realize that “average days on the market” data is actually longer than the statistics would reveal as the listing of many homes have expired and been re-listed starting the “count” over again. Pricing correctly from the beginning, preparing and staging their homes to be appealing to buyers is critical. And, once they sell, if they are also going to be buyers in the same market, they also will see some very good values, balancing the pendulum.
What’s in store for 2007?
It’s all about supply and demand and where we are in the cyclical market of real estate. The length and height of each curve is dependent upon so many factors in a world that is constantly changing that not even the best economic gurus can predict with pinpoint accuracy what will happen in a few weeks or months or quarters. As supply of available homes diminish, because of seller’s withdrawing them from the market or buyers who are purchasing them, the cycle will begin upward once again. But it may take most of 2007 for that to happen – perhaps a small dip in the median prices as existing inventories are used up and then modest recovery and back to a more “normal” balanced market. It appears this downward curve may be a somewhat long but shallow one. Time will tell. One thing is for sure, market histories indicate that real estate prices/investments have always proven to be a good long term investment.
Friday, December 22, 2006
Friday, September 01, 2006
Cape Cod Real Estate Market Conditions - Aug. 2006
The Cape Cod Real Estate Market
(As reported August 2006 by Shirley Enders)
CAPE COD
Throughout Cape Cod, the sales of both detached single-family homes and condos eased throughout the 1st two quarters of 2006.
Year-to-date (January through end of June), the number of single-family units sold was down 18.9% from the same period one year ago. Fewer buyers in the market and more homes from which buyers can choose has relieved much of the upward pressure on prices, resulting in the smallest gains in a number of years.
The Cape Cod condominium market started 2006 with only a slight decrease in number of sales 1st quarter and yet saw a significant gain in median price. However, for the 2nd quarter, the number of sales was down significantly and appreciation leveled with only a slight difference with the same period in 2005. This is not all that unusual in a market where buyers may have more affordable choices in single-family homes from which to choose including a supply in the high $200,000s and low $300,000s.
The motivation of the sellers varies depending on their individual circumstances. Many of the sellers are 2nd home owners and are not necessarily in a hurry to sell and can wait. Others who have relocated or who must move for any variety of reasons might be more “negotiable” than those who will continue to utilize their second home as a vacation home or rental as they have in the past. Unfortunately, homeowners who bought during the upward cycle with too little down are feeling the pinch right now.
It is clear that the recent era of double-digit appreciation is long gone. However, it is also clear that Cape Cod is remaining a desirable place for many to own a home. So far, while the volume of real estate is down significantly and we have seen significant reductions in asking prices, the final sales prices have refused to drop in with the reduced demand. The median held firm for the 1st quarter and saw a slight rise in the 2nd.
What Realtors have noticed is significant reduction in ASKING pricing. Sellers in 2005 were in the old “hot market” mentality remembering days of multiple bids and relatively short market times before negotiating satisfactory terms. However, because of the larger amount of inventory on the market, sellers are now becoming more realistic and once asking prices have been adjusted for the new market conditions, residential properties seem to be selling within 93% to 100% of FINAL ASKING PRICES. Since fewer buyers have a lot to choose from and are taking their time in making decisions, sellers are finding they must be more patient than in prior years.
(As reported August 2006 by Shirley Enders)
CAPE COD
Throughout Cape Cod, the sales of both detached single-family homes and condos eased throughout the 1st two quarters of 2006.
Year-to-date (January through end of June), the number of single-family units sold was down 18.9% from the same period one year ago. Fewer buyers in the market and more homes from which buyers can choose has relieved much of the upward pressure on prices, resulting in the smallest gains in a number of years.
The Cape Cod condominium market started 2006 with only a slight decrease in number of sales 1st quarter and yet saw a significant gain in median price. However, for the 2nd quarter, the number of sales was down significantly and appreciation leveled with only a slight difference with the same period in 2005. This is not all that unusual in a market where buyers may have more affordable choices in single-family homes from which to choose including a supply in the high $200,000s and low $300,000s.
The motivation of the sellers varies depending on their individual circumstances. Many of the sellers are 2nd home owners and are not necessarily in a hurry to sell and can wait. Others who have relocated or who must move for any variety of reasons might be more “negotiable” than those who will continue to utilize their second home as a vacation home or rental as they have in the past. Unfortunately, homeowners who bought during the upward cycle with too little down are feeling the pinch right now.
It is clear that the recent era of double-digit appreciation is long gone. However, it is also clear that Cape Cod is remaining a desirable place for many to own a home. So far, while the volume of real estate is down significantly and we have seen significant reductions in asking prices, the final sales prices have refused to drop in with the reduced demand. The median held firm for the 1st quarter and saw a slight rise in the 2nd.
What Realtors have noticed is significant reduction in ASKING pricing. Sellers in 2005 were in the old “hot market” mentality remembering days of multiple bids and relatively short market times before negotiating satisfactory terms. However, because of the larger amount of inventory on the market, sellers are now becoming more realistic and once asking prices have been adjusted for the new market conditions, residential properties seem to be selling within 93% to 100% of FINAL ASKING PRICES. Since fewer buyers have a lot to choose from and are taking their time in making decisions, sellers are finding they must be more patient than in prior years.
Tuesday, January 03, 2006
Cape Cod Real Estate Market Conditions - Jan. 2006
The Cape Cod Real Estate Market
(As reported December 2005 by Shirley Enders)
CAPE COD
Throughout Cape Cod, sales of detached single-family homes eased throughout the 1st three quarters of 2005. Year-to-date (January through October) shows the number of units sold down 11.6% from the same period one year ago. Fewer buyers in the market and more homes from which buyers can choose has relieved much of the upward pressure on prices, resulting in the smallest gains in a number of years.
(As reported December 2005 by Shirley Enders)
CAPE COD
Throughout Cape Cod, sales of detached single-family homes eased throughout the 1st three quarters of 2005. Year-to-date (January through October) shows the number of units sold down 11.6% from the same period one year ago. Fewer buyers in the market and more homes from which buyers can choose has relieved much of the upward pressure on prices, resulting in the smallest gains in a number of years.
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