Current Market Conditions Posted with December Sales

I just posted my latest market conditions report with sales data through December (as well as a full year comparison for 2008 and 2009.) The sales data has been so similar for the past 3 months, in terms of volume and prices, maybe I should just cut and paste and change the dates! One striking thing this month, though. The average asking price rose 4.2% between December 2009 and January 2010, which flies in the face of logic that indicates sellers need to be reducing prices to bring them more in line with buyer expectations. I hope that's just some temporary anomaly that's a function of year end listing expirations, rather than an indication that sellers are firming on their price expectations.

Please check on the Current Market Conditions Report on my website and drop on back here to leave your thoughts on what's happening.

Comments

[ANM]

David

Very interesting and not at all surprised.

The fact that few properties over $400,000 sold in December indicates money is very tight and people are increasingly value driven across all segments. The rise in average asking price is most probably 'a temporary anomaly' for the reason stated.

The US housing market is about to face massive mortgage resets from spring 2010 to summer 2012. The resets will have consequences on prices in many primary and secondary markets. A number of housing 'pundits' - in the last few months - have suggested, 'the market has bottomed out'. I'm not drinking the kool-aid folks! They sound like the same people who, a few years ago, said the market was strong and wouldn't implode. There will be many good opportunities for those willing to wait for the right deal to come along.

[Ferenc Jaroslawa]

You bet.

I see five acres in Highland sold for 24k.

Purchased in '04 for 59k with pit and perco too.

That's a drop of over 60% in five years.

Your benchmark for five acres of land in Western Sullivan for 2010 - 22k to 30k... forget about the high 30's to fifties guys. Not anymore.

Ferenc Jaroslawa

[Rod]

Land can't be easily purchased for $35k yet. Maybe it will, but there is no indication that sellers are consistently letting go at sub-$40k, with a few exceptions and outliers of course.

[ar]

This pretty amazing sale at $175,000 speaks volumes about the market:

http://www.zillow.com/homedetails/birds-eye-view-map/32764696_zpid/#birds-eye-view

How can new construction possibly compete in this market?

[David Knudsen]

Ah, ar, I think this is what teachers and parents call a "teachable moment", and an excellent illustration about why data on Zillow has to be taken with a grain of salt. Yes, that sale would have been quite remarkable at $175,000 and hard to compete with IF in fact, it was an arms length sale. But in looking at the property record (which isn't available on Zillow), I see that the property was bought by Richard and Linda Sandler in 1992 for $125,000. The sale that Zillow references, in Oct. 2009, for $175,000 shows Richard Sandler as the seller and Linda Sandler as the buyer. While I don't know the Sandlers, or the cirucmstances of this 'sale', it could possibly be related to a divorce property settlement or something not arms length related in some other way to those two parties.

An appraiser looking at this sale as a 'comp' would immediately notice this in the transaction history, and not use it as a comp because it isn't arms length. But Zillow ain't that smart, and so it will go into their comp stew to come up with their Zestimates, whether it is responsive or arms length or not. And that's the big problem with Zillow.

[ar]

Thank you, Master.

[E.O. Schnied]

Yes David.

Yes!

Erwinna Onde Schneid

[TR]

I'm new to this blog, but does the ar person ever get it right?

[ar]

Yes, TR, all the time, but being "new to this blog," you can be forgiven for not knowing that.

[David Knudsen]

In defense of Ar, this one would be really tough to get right.