Market stats from a recent Chelsea assignment
Market change
In order to measure the direction of the market as far as where it has been and where it is currently, I have taken into account a year-over-year market study of both the broader Chelsea market (the macro market) and newer house sales on less than an acre in the school district. The year over year studies also takes into account both the current number of active listings to pending sales, as well as average absorption rates in part to measure the current tenor of the market as well as estimated remaining supply and demand for marketing times. Finally the appraisal also takes into account the subdivision price history exposed through the MLS as far back the records are maintained online. This information is presented below.
For the broader Chelsea market all MLS sales are used, with the exclusion of rental offerings only. In this segment there is a steep decline from the first year through year three of the study, with increases in prices showing in years four and five, both in the overall sales price as well as dollar per square foot sales price. In this grouping, there is an average of 153.8 sales per year (12.82 per month) with sales fluctuating year to year. There are currently 117 houses for sale in Chelsea schools, with 19 showing as under contract (16.24% of listings are under contract). This indicates based on historic data, an 8-month supply of listings which also indicates a slight oversupply in general. Prices appear to have stabilized to show slight improvement for the broader market.
The second market segment includes only houses built between 1990 and 2011 and on one acre or less in the Chelsea school district. In this section there is also a sharp decline in prices in years 2 and 3, as well as year 4. There is only a slight recovery noted for the most recent year and dollar per square foot sales prices remain relatively stable overall. This segment has a much lower number of sales each year and is therefore less reliable for statistics; however it remains useful in tracking pricing trends, absorption and current supply and demand. In this market there are an average of 18.8 sales per year (1.57 per month), and with 7 offerings not yet under contract, the expectation would be the remaining inventory would be absorbed into the market within 5-months which is better than the broader market in general. As there are currently 10 total listings in this segment, and 3 are under contract, the pending to list ratio is 30% which is higher than the market in general. This does show good activity for this particular market segment and a more balanced market with supply and demand.
Finally I considered the entire subdivision pricing trends over time which shows a market that has been reflective of the broader Chelsea market with sales prices dipping to their lowest point in mid-2009 but then rising and falling erratically in 2010 and part of 2011, with the last few sales showing an increase in price. This is evident in both overall prices as well as price per square foot as graphed below.
In conclusion, the subject broader market shows improvement over 2009 levels; the newer houses in Chelsea appear to be absorbing into the market at a greater rate than the general market, and there is good support for a slightly increasing market within the subdivision as a whole. Taking all three segments into consideration, I consider this market to currently be stable to slightly increasing, with demand and supply in balance and marketing times of 3-6 months on average for the subject’s market segment.
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