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April 2008 Newsletter - What's Happening in the Real Estate Market?
What's Happening With the Real Estate Market?
by Andy Smith, CCIM
Boy, what a roller coaster the economic news is lately. Lots of talk of recession, credit crisis, fuel prices going higher than ever, and a stock market that goes up and down like an elevator in a busy office building. During times like this, it is hard to get a clear picture of what is really happening, and even more difficult to have the courage to do anything. A natural tendency is to duck for cover, retreat, don’t make any moves because you may be making a mistake, and hope all will be better next year.
I can relate, as my son and I have been shopping condos in Boston, and have certainly been wondering, and worrying that maybe we did not know when was the right time to buy. Should we buy now, or wait just a little while longer? What will we do if the prices drop after we buy? These questions and fears are understandable, but I knew that even if the market was not at ”its bottom”, we should be taking advantage of a market full of anxious Sellers, and attractive interest rates.
With the help of a knowledgeable local Agent, we were educated about the market, found the neighborhood we wanted, looked at pricing trends over the last 2 years, locked in a very favorable interest rate, and have a property under contract scheduled to close in May. In the end, we knew that there was no “exact right time”, but believe in the sound investment principals of real estate, and knew the interest rates will not get any better than they are right now. We compared what would be our occupancy costs if we waited a little while longer, prices dropped, but interest rates went up ½ of a percent. What the numbers showed us is you live with the cost of the higher interest rate for 15, 20 or even 30 years, and that you are much better off buying now, locking in a great rate and enjoy those savings for years to come. The other lesson that was reinforced is one I have been writing about in every issue for the last 12 months. Real Estate is local. Some neighborhoods in Boston are experiencing a much larger turndown than others, and we needed local help to determine which neighborhoods were the right ones. You don’t go to a national news station to get a local weather forecast. You should not believe that a national real estate forecast is accurate in the market you are in either. Real Estate is local.
| Town | # of Homes Sold 1st Quarter of 2008 | # of Homes Sold 1st Quarter of 2007 | % Change | Average Sale Price 08 | Average Sale Price 07 | % Change | Average Days on the market in 2008 | Average Days on the market in 2007 | %change |
| Vermont | |||||||||
| Peacham | 1 | 1 | 0% | $525,000 | $142,450 | 268.6% | 236 | 73 | 69% |
|
Danville |
2 | 2 | 0% | $109,525 | $118,530 | -7.6% | 170 | 76 | 55% |
|
St. Johnsbury |
6 | 6 | 0% | $152,250 | $118,500 | 28.5% | 99 | 114 | -15% |
| Lyndon | 6 | 2 | 200% | $128,708 | $141,725 | -9.2% | 126 | 216 | -71% |
| Burke | 5 | 2 | 150% | $485,000 |
$147,000 |
229.9% | 144 | 216 | -50% |
| Waterford | 2 | 0 | n/a | $257,450 | n/a | n/a | 86 | 0 | n/a |
| New Hampshire | |||||||||
| Littleton | 6 | 8 | -25% | $294,833 | $204,333 | 44.3% | 195 | 188 | 4% |
| Bethlehem | 8 | 9 | -11% | $164,687 | $171,488 | -4.0% | 239 | 122 | 49% |
| Fran, SH, Easton | 7 | 5 | 40% | $263,985 | $302,080 | -12.6% | 147 | 185 | -26% |
| Lisbon, Lyman, Landaff | 5 | 6 | -16.7% | $147,300 | $140,250 | 5.0% | 121 | 64 | 47% |
| Carroll, Bretton Woods | 1 | 0 | n/a | $235,000 | n/a | n/a | 44 | 0 | n/a |
| Totals | 49 | 41 |
19.5% |
$251,248 |
$135,123 | 85.9% | 146 | 114 | 22% |
Let’s take a look at the first three quarters in the greater Littleton and St J markets. Overall, we see a great start to 2008, with unit sales up 19.5%! You don’t hear that in the national news. That s a great start for our area, and one that we see continuing to increase as the sun gets a little warmer, and the record snows begin to melt. But wait, what’s going on in Peacham, Burke, and Littleton? Are prices really going up that much? The statistics are accurate, but your local Agent can fill you in on the details. In Peacham, we are looking at 1 sale for $525,000 against one last year of $142,450, and in Burke the numbers reflect two brand new Bear Path condos that sold around the 1 million dollar mark. In Littleton, there was the March closing of the highest residential sale ever in at $695,000. Does that mean your property went up 85% as the overall number shows? Probably not. However, it also means that your property, or the one you are considering buying probably did not go down like the properties in Tampa, Fl, or Las Vegas, NV. It also means there are Buyers that can and will buy in this market. The sky is not falling, and in fact, things are looking pretty good for the local forecast.
If you want an up to the minute forecast on your property, or on one you are considering buying, please let us know. We would be delighted to help.
