January has never been a strong month for home sales. So it's no real surprise that only 40 homes sold in Spanish Fort, Daphne, Fairhope and Point Clear last month. In fact, only 42 sold in January 2008.
So I remain watchful for signs showing the housing market's direction in the coming months.
Pending sales are up to 102 as of Feb. 4, 2008, compared with 86 homes under contract just after the New Year.
Inventory remains roughly the same at 1,090 homes for sale on the Eastern Shore.
A couple of statistics show that sales of high-end homes were anemic, with the average sales price dropping dramatically. However, the list-to-sale percentage rebounded to 94.21% in January, up from 91.99% in December. Stats are drawn from the Baldwin Multiple Listing System.
Here are the stats for the Eastern Shore in January, 2009:
Total houses for sale: 1,079
Spanish Fort: 127
Daphne: 327
Fairhope: 506
Lake Forest: 130
Pending sales
Total: 102
Spanish Fort: 24
Daphne: 30
Fairhope: 35
Lake Forest: 13
Closed sales for January 2009
Total: 40
Average sales price: $228,944, down from $274,054 in December
Median sales price: $216,800, down from $225,000 in December
List to sale percentage: 94.21%
Spanish Fort: 7, where the highest selling price was $259,900
Daphne: 17, where the highest selling price was $394,500
Fairhope: 13, where the top seller was a $670,000 foreclosure
Lake Forest: 3, where the highest selling price was $161,000
Of the 5 listing appointments that I went on last week, only two owners chose to list. The others wanted to wait until home prices rebounded to 2005-2006 levels. These individual sellers were looking for a price point some 10% to 25% above what the market showed they would get today ... or rather 9 months down the line when they could expect a sale.
Admittedly, it's foolhardy to try to definitively answer this question. But there are statistics that show that we will be waiting a few years even with the optimum circumstances for prices to reach those golden days of 2005-2006.
For discussion purposes, let's assume we are talking about the broad market. In fact, all real estate is local, influenced by supply and demand, influx of new industry and workers, availability of housing after natural disasters, etc.
Further, the market must hit bottom first and there are several analysts predicting that this will happen in mid-June. In fact, Jim Cramer of Mad Money says it will happen precisely 161 days from today. Love the drama!
But in order for it to stabilize, so must the rates of employment, mortgage interest and foreclosures. Financial markets must find more sure footing and those big bad demons of inflation and deflation must be held at bay.
So let's assume that bottom is hit in June and all the other complexities are non-factors here.
For some sellers, there's no problem in putting house selling on hold for several years. If you're a seller who bought in 2004-2006 and there is actual money to be lost, by all means wait if you can.
But I believe that owners of existing homes may find that they simply missed the golden opportunity. In finance it's called unrealized gains. To wait a year before putting a house on the market is not only prudent, but helps the rest of the housing market by keeping inventory down. But to wait several years, while your residence ages, your house style becomes more dated, may not be a better choice.
I welcome any comments how to better answer my sellers' questions.
2008? Whew! Glad that's over.
2009? At least we know what we're dealing with.
Here's a backward look on a sorry year in real estate, and a forward look in which I will stick my neck out.
2008:
•n Twenty-four percent fewer homes sold than in 2007 from Spanish Fort to Point Clear.
•n Foreclosures, short sales and distress sales (essentially pre-foreclosures) captured buyers' attention.
•n On the Eastern Shore, the average sales price was down only 1% from the previous year and the median sales price was down just 6%. But it didn't feel that way, and a late-year statistic proved the point: In December, sellers took on average 8% off the list price to move their homes.
2009:
•n Interest rates have already dropped after the Fed unveiled a plan to buy $500 billion in mortgage securities and debt. For just a few hours one day in December, the rate hit 4.25%. The drop has triggered a new refinancing boom and hopefully will spill over into home sales.
•n Business Week magazine predicts the market has hit bottom, but prices will remain weak through the end of 2009. It cites the large inventory of houses as a negative and predicts potential sellers who have been sitting on the fence will put their homes on the market at the first sign of improvement, leading to more inventory. Locally, November was the worst month for sales (only 47 on the Eastern Shore), mirroring sales the month after the terror attacks of Sept. 11, 2001. I agree - and hope - we've hit bottom in terms of the number of sales.
•n There's a lot of pent-up demand. Marriage, divorce, new babies, retirement: Think about everyone who had a housing need that they didn't act on in 2008. This year may be their year.
•n Finally, a couple of opinions: Houses with great prices, and great houses, will sell, as always. If you're considering buying up or down, why wait? You may get less for your present house, but you will probably pay less for your new one, and the interest rate will be very attractive.
On to the stats:
Fourth quarter sales on the Eastern Shore registered a yearly low. Only 162 sold, compared with 265 in the third quarter. Average sales price was $260,838, with sellers taking on average 6% off the list price to sell. Average days on market were 162.
For the year, 833 homes sold, compared to 1,092 in 2007. Average sales price declined slightly from $292,091 to $287,736. The time it took to sell lengthened from 144 days in 2007 to 166 days in 2008. (Note: Both figures were skewed by houses being re-listed.)
Fairhope: 57 homes sold in the 4th quarter, compared with 68 during the same time in 2007. Average price was $304,455, compared with $356,772 the previous year. Average time to sell rose from 157 days to 172 days.
For the year, 293 homes sold, compared with 400 sales in 2007. Average prices actually rose from $339,028 in 2007 to $353,765. Days on market rose from 162 to 197.
Daphne/Montrose: 69 homes sold in the 4th quarter, compared with 58 in the 4th quarter of 2007. Average sales price declined to $248,922, from $258,273 at the same time in 2007. Days on market rose from 153 to 166.
During all of 2008, 321 homes sold, compared with 394 in 2007. Average sales price was $271,599, down from $295,486 for all of 2007. Days on market stretched from 141 to 150.
Lake Forest: 15 homes sold, compared with 25 sales in the 4th quarter of 2007. Average sales price dropped from $162,768 to $139,600. Days on market lengthened from 101 days to 124 days.
For the whole of the year, 99 homes sold, compared with 114 in 2007. Average prices dropped from $170,930 to $157,355 in 2008. Days on market rose from 110 to 159.
Spanish Fort: 21 homes sold in the 4th quarter, compared with 33 during the last quarter of 2007. Average sales price dropped from $304,803 to $268,198 in 2008. The time it took to sell was virtually unchanged at about 130 days.
In 2008, 120 homes sold vs. 145 in 2007. Average sales price dropped from $281,232 to $277,245. The days on market stretched from 123 days to 140 days.
Inventory: As of Jan. 8, there were 1,082 homes on the market on the Eastern Shore.
■ Spanish Fort: 118
■ Daphne/Montrose: 328
■ Fairhope: 502
■ Lake Forest: 134.
If you have specific questions about your home's value, feel free to call or email.
2008? Whew! Glad that's over.
2009? At least we know what we're dealing with.
Here's a backward look on a sorry year in real estate, and a forward look in which I will stick my neck out.
2008:
•n Twenty-four percent fewer homes sold than in 2007 from Spanish Fort to Point Clear.
•n Foreclosures, short sales and distress sales (essentially pre-foreclosures) captured buyers' attention.
•n On the Eastern Shore, the average sales price was down only 1% from the previous year and the median sales price was down just 6%. But it didn't feel that way, and a late-year statistic proved the point: In December, sellers took on average 8% off the list price to move their homes.
2009:
•n Interest rates have already dropped after the Fed unveiled a plan to buy $500 billion in mortgage securities and debt. For just a few hours one day in December, the rate hit 4.25%. The drop has triggered a new refinancing boom and hopefully will spill over into home sales.
•n Business Week magazine predicts the market has hit bottom, but prices will remain weak through the end of 2009. It cites the large inventory of houses as a negative and predicts potential sellers who have been sitting on the fence will put their homes on the market at the first sign of improvement, leading to more inventory. Locally, November was the worst month for sales (only 47 on the Eastern Shore), mirroring sales the month after the terror attacks of Sept. 11, 2001. I agree - and hope - we've hit bottom in terms of the number of sales.
•n There's a lot of pent-up demand. Marriage, divorce, new babies, retirement: Think about everyone who had a housing need that they didn't act on in 2008. This year may be their year.
•n Finally, a couple of opinions: Houses with great prices, and great houses, will sell, as always. If you're considering buying up or down, why wait? You may get less for your present house, but you will probably pay less for your new one, and the interest rate will be very attractive.
On to the stats:
Fourth quarter sales on the Eastern Shore registered a yearly low. Only 162 sold, compared with 265 in the third quarter. Average sales price was $260,838, with sellers taking on average 6% off the list price to sell. Average days on market were 162.
For the year, 833 homes sold, compared to 1,092 in 2007. Average sales price declined slightly from $292,091 to $287,736. The time it took to sell lengthened from 144 days in 2007 to 166 days in 2008. (Note: Both figures were skewed by houses being re-listed.)
Fairhope: 57 homes sold in the 4th quarter, compared with 68 during the same time in 2007. Average price was $304,455, compared with $356,772 the previous year. Average time to sell rose from 157 days to 172 days.
For the year, 293 homes sold, compared with 400 sales in 2007. Average prices actually rose from $339,028 in 2007 to $353,765. Days on market rose from 162 to 197.
Daphne/Montrose: 69 homes sold in the 4th quarter, compared with 58 in the 4th quarter of 2007. Average sales price declined to $248,922, from $258,273 at the same time in 2007. Days on market rose from 153 to 166.
During all of 2008, 321 homes sold, compared with 394 in 2007. Average sales price was $271,599, down from $295,486 for all of 2007. Days on market stretched from 141 to 150.
Lake Forest: 15 homes sold, compared with 25 sales in the 4th quarter of 2007. Average sales price dropped from $162,768 to $139,600. Days on market lengthened from 101 days to 124 days.
For the whole of the year, 99 homes sold, compared with 114 in 2007. Average prices dropped from $170,930 to $157,355 in 2008. Days on market rose from 110 to 159.
Spanish Fort: 21 homes sold in the 4th quarter, compared with 33 during the last quarter of 2007. Average sales price dropped from $304,803 to $268,198 in 2008. The time it took to sell was virtually unchanged at about 130 days.
In 2008, 120 homes sold vs. 145 in 2007. Average sales price dropped from $281,232 to $277,245. The days on market stretched from 123 days to 140 days.
Inventory: As of Jan. 8, there were 1,082 homes on the market on the Eastern Shore.
■ Spanish Fort: 118
■ Daphne/Montrose: 328
■ Fairhope: 502
■ Lake Forest: 134.
If you have specific questions about your home's value, feel free to call or email.
Home sales improved in December in Spanish Fort, Daphne, Fairhope and Point Clear. Sixty-six homes sold in December, up from the abysmal statistic of only 47 home sales in November.
Pending sales dropped to 86 under contract as of Jan. 3, 2009. That's a decrease from the 98 under contract in November.
Inventory dropped from 1,157 homes for sale on the Eastern Shore as of early December to 1,079 homes for sale Jan. 3, 2009. But this is only because a tremendous number of listings expired with the old year. Expect them to be brought back on the market rapidly.
Interest rates dropped before Christmas to a low of 4.25%, but that held briefly. Still, rates have vacillated in the upper-4% to lower-5% area since.
The list to sale percentage has widened, meaning sellers are making deals to get houses sold. In November, the list-to-sale percentage was 95.21%; in December it dropped to 91.99%. In other words, sellers took on average 8% off the price of the house.
Here are the stats for the Eastern Shore in December:
Total houses for sale: 1,079
Spanish Fort: 118
Daphne: 329
Fairhope: 501
Lake Forest: 1131
Pending sales
Total: 86
Spanish Fort: 20
Daphne: 28
Fairhope: 29
Lake Forest: 9
Closed sales for December 2008
Total: 66
Average sales price: $274,054
Median sales price: $225,000
List to sale percentage: 91.99%
Spanish Fort: 7
Daphne: 24
Fairhope: 21
Lake Forest: 5
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Janet English, RE/Max By The Bay, offers top-notch market, school and community information to clients in Spanish Fort, Daphne and Fairhope in Baldwin County Alabama
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