Fairbanks Alaska Real Estate Month in Review - August 2008
What a crazy month. We bid adieu to Lehman, then watched as Bank of America swallowed Merrill Lynch and now the Fed has nationalized AIG. Rumors of a similar fate surround the few other giants left standing. The real estate and finance landscape is changing daily and at a record pace. To say we’re living in interesting times would be an understatement. The good news is that the Fairbanks real estate market continues to move forward despite near catastrophic news from the financial powerhouses on Wall Street.
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Locally, home sales picked up somewhat in August over July and with 106 homes sold. August earns the distinction of being the busiest month of 2008, thus far. We're still trailing our sales numbers as compared to this time last year by 22%. Judging from the rumblings from other brokers and buyers I expect that number to widen to perhaps upwards of 25% behind '07 by years end.
Marketing time increased slightly to an average of 106 days in august and 128% over the 2007 average. At least in the short term, home prices are going to need to come down in order to stimulate the market. The spike in the discount-from-list-price number is due to a handful of sellers who, until recently, were unrealistic with respect to value. Three Fairbanks sellers finally decided to cut their asking price by more than $100,000 to effect a sale. One slashed his price by more than $200,000 (28.3%) before a buyer showed interest.
Homes in good condition that are priced within the market will continue to sell. Those sellers unwilling to market their homes accordingly will join the ranks of hundreds of others who are languishing on the market with no buyer in sight.
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