LOOKING AT THE MARKET STATISITCS FOR FEBRUARY 2006-2007
Something isn't right. Prices are UP in Anne Arundel County Maryland in 2007 over February 2006.
How could that be?? Look at the stats:
ANNE ARUNDEL COUNTY, MARYLAND
Total Dollar Volume is UP 11.68%
Average SOLD Price is UP 13.32%
Median SOLD Price is UP 7.55%
Now here's where it gets even strang:
Total Units SOLD is DOWN 1.45%
Average Days on the market is UP 86.67%
Average list price is UP 16.95%
Average Sale Price as a percentage of Average List Price is 92.78% for 2007, down from 95.75% in 2006
Wouldn't it make sense that, if the DOM is increasing month after month, the total units sold is down,
percentage of list to sold price is down, that the prices would come down? Wouldn't that make sense??
It would to me. But, that isn't what is happening in a lot of our areas.
So, I thought, perhaps this is an anomaly. So, I looked at Montgomery County information for the same
time period, February 2006 to 2007.
MONTGOMERY COUNTY, MARYLAND
Total Dollar Volume is UP 5.22%
Average SOLD Price is UP 6.96%
Median SOLD Price is UP 5.52%
Now here's where it gets even strang:
Total Units SOLD is DOWN 1.63%
Average Days on the market is UP 65.52%
Average list price is UP 10.30%
Average Sale Price as a percentage of Average List Price is 94.30% for 2007, down from 97.25% in 2006
I'm still perplexed so I take a trip across the beautiful Potomac River into Northern Virginia and I find
something quite different. Loudoun County is a market that I follow very closely.
Total Dollar Volume is DOWN (11.85%)
LOUDOUN COUNTY, VIRGINIA
Total Dollar Volume is DOWN (11.85%)
Average SOLD Price is DOWN (7.80%)
Median SOLD Price is DOWN (11.60%)
Now these results make sense to me:
Total Units SOLD is DOWN 4.39%
Average Days on the market is UP 73.08%
Average list price is DOWN (2.55%)
Average Sale Price as a percentage of Average List Price is 91.38% for 2007, down from 96.59% in 2006
I thought I needed another county to confirm that the trend made some sense for Northern Virginia.
So, I went to Fairfax County and found:
FAIRFAX COUNTY, VIRGINIA
Total Dollar Volume is DOWN (1.58%)
Average SOLD Price is DOWN (1.35%)
Median SOLD Price is DOWN (4.47%)
But, then things want crazy again with
Total Units SOLD is UP 4.39%
Average Days on the market is UP 82.26%
Average list price is UP (2.19%)
Average Sale Price as a percentage of Average List Price is 93.42% for 2007, down from 96.78% in 2006
Not shown in the above statistics is "Subsidy." So, I looked at about 50 SOLD properties and found a high indicence of Seller Subsidy.
Status: Sold Style: Colonial List Price: $415,000
Close Date: 14-Feb-2007 Seller Subsidy: $10000 Close Price: $415,000
Status: Sold Style: Colonial List Price: $414,000
Close Date: 28-Feb-2007 Seller Subsidy: $15000 Close Price: $414,000
Status: Sold Style: Colonial List Price: $415,000
Close Date: 16-Feb-2007 Seller Subsidy: $10000 Close Price: $410,000
I am seeing a lot more "subsidy" in closed listings than previously. This is also a statistic that doesn't
reach the published reports from the MLS. But, it is a very important piece of information in trying to
make some sense out of these stats.
SOME THOUGHTS ON WHAT THE ABOVE SHOWS
* Americans are a country of home owners.
* Sellers can list their homes on the high side and folks are still going to buy.
* Buyers are benefiting from subsidies as much as price.
* The real estate market in Maryland and Northern Virginia is VERY stable.
* I still believe that prices need to come down to stimulate buyer interest to a comfortable level.
Homefinders.com Maryland and Virginia Market Area
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Reprinted with permission from the Metropolitan Regional Information System Annual Report
MRIS MARKET REPORT FOR 2006:
Now that the market has had a year to absorb the impact of rising mortgage rates, it is worth
identifying its effects and which sectors have proven the most resilient. Based on the sales
information from the fourth quarter of 2006 (October, November, and December) and comparing
it with the same time period in 2005, we see that:
� The most homes are being sold in the middle price ranges.
� The fewest homes are sold in the lower price ranges.
� Compared to last fall, the middle price ranges have proven to be the most resilient in
terms of retaining their level of sales.
� However, sales have softened most in the lower price range.
Local Outlook
About 10% of all home sales were for second homes (investor rental homes and vacations homes) in the past
three years in the local area. Therefore, there is a little risk of investor �dumping� properties onto the market
over the short term. With the job growth continuing to move nicely, the worst in the housing market appears
to be at its end. Home sales will steadily strengthen from the second half of 2007. Home sales will rise 2%
in 2007 and then 5% in 2008. Price growth will be sluggish in 2007 in order to work off the excess inventory,
but will easily outpace the inflation rate by 2008, and thereby providing solid financial returns to ownership.
SOURCE: Metropolitan Regional Information Systems, Inc.
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