So what's happening in New Castle County Delaware real estate today? -- A bit of a slog but some signs of an upturn.
As noted in my last post on New Castle County, the market here experienced the same drop in activity that we saw region wide. Since then, again like other areas, it has continued to struggle. Closed sales have continued at the slowest pace seen in years, but recently we have seen an uptick in new properties going under contract. We may be seeing the beginning of a more solid market.
First Some History:
In New Castle County as a whole, from an average sales price of less than $200,000 in 2003 with 7689 reported sales, the residential real estate volume activity peaked in 2005 with 8285 reported sales in the local MLS system with an average price of just over $245,000. Prices continued upward to reach an average sales price of $266,000 in 2007, but by that point sales volume had fallen to 6880 units. In 2008, we experienced a decline in both prices and units to 4883 homes sold at an average price of $259,000. Then, as mentioned earlier, activity dropped dramatically as the impact of the turmoil in the financial markets really hit home in the fourth quarter of 2008.
In 2009, we have continued to see unusually slow activity in New Castle County DE for settled properties with only 220 units being recorded in the MLS for January and 254 for February. This is down 28% from the corresponding months in 2008. Prices have also declined to an average price of $238,000. On a good note, there has been an uptick in pending properties. In the first two months of 2009, we have seen an additional 677 properties with accepted contracts of sale, down only 21% from the corresponding months in 2008, and up 31% from the last two months of 2008.
Bottom Line: Signs of an upturn? Too early to tell for sure but certainly trending in the right direction.
Although it remains unclear if we have reached a floor, there are signs that we could have a fairly strong spring. The increase in new properties going under contract will inevitably lead to increased sales and this should tend to free up activity as sellers look to move up. The market as a whole should benefit both from both the decline in prices/mortgage rates and the pent up demand resulting from the recent below normal sales rate. If Washington and the Treasury Department can show any leadership, the market could firm fairly quickly. With historically low interest rates, increased inventory, and declining home values, this is actually one of the best times to purchase properties we have seen in years. Will it hold? - Too soon to tell, but at least today we are continuing to move in the right direction.
(All statistics are from the TrendMLS System and believed accurate but not guaranteed.)