Murrieta CA Condo & Townhome Monthly Real Estate Market Report - November 2011.
This monthly report reflects the changes in Murrieta’s condominium and townhome real estate market over the past 12 months.* So how do things compare to a year ago? Well for the 90-day period ending last month, median condo and townhome listing prices and sold prices were both slightly lower. Plus, the number of condos and townhomes listed for sale and the number sold were both down significantly. And there were still a high number of Short Sales and REO’s on the market. Read on to find out how these factors are impacting Murrieta’s condo and townhome real estate market.
Median Condo & Townhome Prices
Listing prices were slightly lower for the 90-day period ending last month compared to the same period last year. Sold prices were also slightly lower compared to last year. The median listing price was $123,000 last month, down from $126,500 a year ago. (The listing price is the amount that sellers wanted someone to pay for their home.) The median sold price was $119,000 last month, down slightly from $120,000 a year ago. (Sold prices are the actual amount that buyers paid for the home.) Though last month’s median sold price was slightly down from a year ago, the good news is that prices continued to remain stable during the past 12 months, with the median prices of condos and townhomes ranging between $115,000 and $120,000.
Median Condo & Townhome Inventory
The number of Murrieta condos and townhomes listed for sale was down for the 90-day period ending last month compared to the same period last year, and the number sold was also down. There were 88 listings for sale, down from 119 a year ago, and there were 77 condos and townhomes sold, down from 113 a year ago. Though the number of condos and townhomes sold was down from a year ago, which would tend to put downward pressure on sold prices due to lower demand, the number of homes listed for sale also dropped, which puts upward pressure on prices due to a smaller supply. This helps explain why condo and townhome sold prices have remained stable through the year.
Median Condo & Townhome Sales Types
The Murrieta condos and townhomes sold can be categorized into three transaction types: Standard, Short Sale, and REO. Standard sales are traditional, where owners sell their homes for more than they paid. Short Sales, also known as Short Pays, are sales where owners sell the home for less than they owe on their mortgage and must seek their lender’s approval to sell the home. REO’s (Real Estate Owned) are foreclosed homes where lenders are now the owners and are offering the home for sale. REO’s are also known as bank-owned homes.
The number of REO’s and Short Sales sold was down last month from the same period last year, while the number of Standard sales was up. During the 90-day period ending last month there were 31 REO sales, down from 48 a year ago, and 23 Short Sales, down from 39 a year ago. In contrast there were 21 Standard sales, up from 18 a year ago. It appears that the excessive inventory of low-priced distressed properties is being absorbed, which is good news for the Murrieta housing market as it suggests that home prices will remain stable. However, the number of REO’s and Short Sales still outnumber Standard sales by a factor of 2.5-to-1. So while condo and townhome prices are remaining stable, odds are we won’t see any significant increases in home values until the distressed property inventory is finally absorbed.
Murrieta Condo & Townhome Absorption Rate Trends
The absorption rate refers to the number of months it will take to sell all the homes currently listed for sale. For example, if it will take six months to sell the current inventory of homes, then the absorption rate is six months. When the absorption rate is less than five months, it’s considered a seller’s market. When the absorption rate is more than seven months, it’s a buyer’s market. And when the absorption rate is between five and seven months, it’s a balanced, or stable market.
Absorption rate trends help buyers and sellers determine a realistic value for the home. When absorption rates are trending upward, then homes are taking longer to sell, which puts downward pressure on housing prices. However, when absorption rates are trending downward, then homes are selling faster, which puts upward pressure on housing prices.
Last month, the absorption rate for Murrieta condos and townhomes was 1.1, which places the absorption rate within the Seller’s Market range. Also, the trend is flat, virtually unchanged over the past several months. Based on the absorption rate’s current trend, it appears that it will continue to be a Seller’s Market for quite some time.
*The values shown for each month are based on data measured during the prior 90 days of activity. For example, values shown for October 2011 are based on data measured from the beginning of August 2011 through the end of October 2011. The information provided is deemed reliable, but is not guaranteed.
Copyright ©2011 Bill Burchard
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