October 2011 Hillsborough Real Estate Market Update– Holding Steady

 Hillsborough is a relatively small market - with 100 to 150 sales per year. The trends in this area do not frequently change on a month-to-month basis. For October 2011, sales continue to remain steady, whereas both listings and inventory are low.

For each of the past five months, sales have decreased, but this is more likely due to the change in seasons - more sales have been recorded in summer and early fall than late fall and winter – rather than a change in the market. Last October, eight sales have been recorded. There have been 126 homes sold within the first ten months of this year, which is a 19% increase from the same duration last year and 62% increase in 2009.

Fewer new listings have come onto the market while sales have been increasing. New listings declined by 13%. Distinct decline has been observed with inventory. At the end of October last year, the number of homes for sale in Hillsborough  have reached 85 while only 55 homes for sale have been recorded at the end of October this year. Homes for sale are down by thirty and this phenomenon indicates that there’s less competition for each seller and less choice for buyers. Homes on the market this year are selling faster as compared to last year. In 2010, the average home that has sold did so in 67 days while this year, the average home has sold in 60 days.

Latest closed sales prices in Hillsborough suggest the importance of making an in depth assessment rather than merely basing your judgment from changes in median or average selling prices. Median sales values decreased by 10%, and average selling values decreased by 5% through the first ten months of this year. Having the chart below as basis, prices seem to be down by about $200,000 to $300,000 from the end of 2010. This data, although correct, can be deceiving and it’s because there has been a change in the type of home this year from the prior year. In 2010, the average size of a home sold has been 4,200 square feet while in 2011; it has been 3,800 square feet.

Having an average price per square feet of about $700, the 400 square feet difference correlates to around $280,000, which equals to the whole variation in the average and median prices. Selling values seem to be going up when we control the variation in the size of homes being sold and depend merely on the price per square foot.

 The market remains strong and the demand continues; but although there are continued targeted price drops, sellers are not compelled to reduce their prices dramatically to encourage buyers. In each of the last seven months of the year, sale price divided by list price has been greater than 95% - indicative of homes being sold for more than 95% of the seller’s average asking price. The sale price divided by list price was at or above 95% within three months only, in the 15 months from January 2010 to March 2011.  Normal rate differs by place and even during the years when market in Hillsborough is booming or 2004/2005, the normal rate has been well below 100%.

Hillsborough Real Estate for October 2011 – By The Numbers

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