By Angela Thelin, Managing Director - Exceptional Properties on January 25, 2010 Exceptional Properties | 1 Comment »
Let's start by defining "Luxury Properties". In essence, they are properties with distinct price points that differ from area to area. For the purpose of this writing, I have split this market into three different price levels: $1-3M, $3-5M and $5M+.
After an increase in listing inventory over the first half of 2009, I see some clear signs of movement and a hope for positive things to follow. In general, there was an increase in activity level after May, however it was primarily the lower end of the luxury property market that was moving. This follows the same pattern as previous years, keeping in mind that the total sales volume is higher in this price range. Interestingly, the listing inventory was lower than 2008 at the same time. The lower inventory translates into less properties on the market for buyers to choose from and better opportunities for sellers. With all that said, pricing the home correctly is a big component in the sales activity.
From January to October last year, 779 sales were reported in the range of $1-3 million compared to 1168 for the same time in 2008 and 1791 in 2007. Sales in 2009 was consequently 33% below 2008 and 57% below 2007. If we just look at the last five months for the same years we see that sales are 22% below 2008 and 45% below 2007, which is a sign that we are moving in a positive direction. On top of this, sales in October were higher than for the same period in 2008. You can expect properties at this price point to stay on the market for an average of 144 days compared to the average of 126 and 118 from same period in 2008 and 2007.
At the $3-5 million listing price range, we had 89 sales through October 2009, again with the highest number of sales during the summer. Sales for the same period in 2008 were 151 and 252 for 2007. Just looking at the last three months we can see that the number of sales during the two last years are almost on par at 40 sales and just 35% lower than 2007. The average time for a property to be on the market at this price point is around 171 days. From the chart below you can see the inventory in 2009 is higher than the same period over the past two years.
Moving onto the higher tier of luxury homes, $5+ million, there were 55 sales in Connecticut from January to December 1, 2009 compared to 77 sales in 2008 and 141 in 2007. The number of sales from September through November was slightly higher than this same time in 2008: 22 vs. 20. Even though it is considerably lower than the 41 in 2007, it's still a positive development. At this price point you can expect your average days on the market to be around 196, which is in line with the situation for 2007 but about 50 days longer than in 2008.You can see the total inventory building over the past years and remaining at a higher level in 2009 compared to the prior two years.
Fairfield County is following the trends of the State as there is a higher concentration of the higher end homes in this County than the rest of Connecticut.
For information on the latest statistics in your specific city or town, visit
http://www.raveis.com/localhousingdata.asp .
To learn more about how to analyze the data visit http://blog.raveis.com/2009/11/16/analyzing-the-data-for-buying-and-selling-a-home/
More luxury market watch blogs to follow for MA, RI, and Westchester County, NY
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