Summit’s home market started the quarter slowly, but improved by December. Let us take you through our analysis.
Following Wall Street’s September market meltdown and the Euro fiasco, the level of nervousness at the start of the quarter was high. Many felt they had lived through the 2008 movie, and no one wanted a sequel.
Predictably, October and November transactions declined sharply from the prior year. In October closings fell from 13 to just 7, and in November, from 26 to 15. And Days on the Market almost doubled from prior year levels. Activity indeed slowed from promising earlier year results. These two charts show this trend well:
But despite obvious market concerns, Average Original List and Average Sale Prices were just slightly lower for the quarter. And then these same prices rebounded strongly in December. Indeed, in the last month of 2011, 7 homes sold for more than $1 million versus 5 in the prior year. The average sale price increased by 18%, an astounding number, although on a short time frame with limited data points. But check out these two graphs, which suggest underlying housing strength:
And if this emerging December trend continues, as we suspect it will, keep an eye on home inventory. At Bunn Moxley Homes of Keller Williams we believe the approaching year end focused many minds, whether for tax reasons or otherwise: over half the homes sold in December had been on the market for longer than 150 days. Buyers and Sellers that heretofore were unable to agree on price, finally transacted. And while the List Price/Sale Price ratio dipped below 90%, the clearing price level improved over last year (indeed, up 18% in December).
We have uploaded onto our website (www.bunnmoxleyhomes.com) our analysis of every home sold in Summit in the 4th Quarter. We find it useful to look at activity during a quarter, rather than a month. Home data is lumpy, and a few sales in one month versus another do not make a trend. But with interest rates on the 30 year below 4 percent, and a 10 Yr Treasury hovering around 2%, and with home inventory at its lowest level in three years, we remain quite constructive on the market.
Understand that this market snapshot hits just the highlights. We have examined the data in many different ways, by luxury price, by bedroom and by neighborhood. Free free to reach out to us if you want to see a different data slice of the market, or to understand our perspective.
Here is our Spreadsheet of Summit Sold Homes from October through December 2011:
