New Hampshire Market Trends July 2007

July 2007  

New Hampshire Home Sales Trends
Look Better Than the Nation's
-by Peter Francese

The monthly data chart at the end of this article gives us a snapshot of residential sales versus new listings.  But Chart I below shows the trend over the past 24 months.  It shows pretty clearly the seasonal variations in statewide home listings and sales.

What it also shows is that over the past two years, new listings rose to a peak of  above 3,000 units each summer and then fell to about 1,000 units each December.  This seasonal pattern looks remarkably consistent over the past 24 months.

Chart I also shows residential sales (excluding condominiums) peaked in August 2005 at about 1,800 units, peaked again at almost 1,600 units in June of last year, but may not have peaked yet this year.  June 2007 sales reached nearly 1,400 units.  The lowest sales months, to no one’s surprise, were January and February when transactions averaged about 700 a month both last year and this year.

What this chart is not showing is a major downturn in New Hampshire’s housing market.  Home buyers and sellers often get frightened by national news stories about home sales “plunging” to “record lows.”  Perhaps we should make part of this chart into a handout so buyers and sellers could see how fairly large seasonal variations can affect one’s perception of housing market conditions.

Chart II below shows part of the national picture with data from the National Association of Realtors (NAR).  An interesting distinction between the New Hampshire numbers and those of NAR is that except for a brief spike up last winter, US sales appear to have little seasonal variation and look to be trending down.

From May of last year to this May, NAR data says that national existing SFD sales were down 10.8 percent and new homes sales were down by 15.8 percent.  In that same one year period, NH residential existing plus new home sales were down 12.5 percent.

Condominium sales in New Hampshire over the past two years present a somewhat different picture. New listings peaked in May of last year at above 1,000 units, but only reached about 900 this past May.  And monthly sales, which peaked in the summer of 2005 at just above 600, were 100 units lower in June of last year and were a bit above 400 units each this May and June.

Chart III suggests that the condominium sales in New Hampshire are weaker than other types of residential units.  Nationwide monthly condominium/coop sales were down 6.7 percent from May 2006 to May 2007. But in the same period in NH, they were down 15.9 percent.  From June of 2005 to June of 2007 monthly, NH condo sales have dropped 27.8 percent compared to a 19.1 percent drop in residential sales.

One reason for this greater weakness may be the rapid increase in the number of age restricted condominiums, which can only be sold to buyers ages 55 or older.  That limited pool of buyers may be growing, but perhaps not fast enough.

Some perspective on foreclosures

There are an estimated 375,000 owned dwellings in New Hampshire and according to NNEREN about 18,000 of them or roughly 1 in every 20 are for sale. According to one source, less than 400 units in NH are in the foreclosure process.  But another source says that about 600 homes here are now owned by the mortgage lender.

Any home foreclosure is a terrible thing for the owner of that house.  But compared to other states, NH has one of the very lowest foreclosure rates in the nation.  Also, taken in the context of how many homes there are for sale, unless the 400 or 600 are all put on the market at one time at a big discount (an unlikely event), they will probably not have much of an impact on this housing market. However, despite their small numbers, they can and often do have a psychological impact by making lenders and potential buyers more risk averse.

County data for the first half of this year suggest that home prices are holding pretty firm and even rising in a few counties.  But unit sales are below last year in every county except Rockingham County.  That was the only county where the average price went down as much as 5 percent.  During June, the nearly 1,400 homes that sold had been on the market an average of 114 days, less than 4 months.

January-June 2007 NH residential (non-condominium) sales

Source:  Northern New England Real Estate Network (NNEREN).  Statistics are based on information from NNEREN for the respective periods shown for the respective regions in the State of New Hampshire or all towns in the State of New Hampshire. All analysis and commentary related to the statistics is that of the New Hampshire Association of REALTORS® and not that of NNEREN.

The Real Estate Market Trends newsletter is provided for the benefit of the members of the New Hampshire Association of REALTORS®, Inc.  ©Copyright 2007 New Hampshire Association of REALTORS®, Inc. All Rights Reserved.

Peter Francese is the Demographic Advisor to the New Hampshire Association of REALTORS®.