Housing Market in Marlborough
I’ve been a bit alarmed at the number of “For Sale” signs springing up all over Marlborough. It is spring and the time to list houses, so is it my imagination or are there more houses up for sale than usual? The hand written “For Sale By Owner” signs are particularly poignant.
The following graphs were provided by Ken Hjulstrom of the William Raveis Real Estate company.
Inventory: The number of houses currently for sale.
May 2009 inventories are running about even with May 2008, but ~47% higher than May 2007.
The bad news is how many housing units are selling.
While in April of 2009 we had ~57 units for sale, only ~4 units sold.
Median Sales prices have trended downward. Losing about $130,000 over the past 2 years.
As the Average Sales price has also. Average sales price has dropped about $150,000. OUCH!
But the Asking Price to Sales Price ratio has remained steady.
So, it’s not a great time to sell, there are more housing units on the market then 2 years ago, but comparable to last year.
Selling prices have dropped, but it appears the sellers have priced their homes realistically by recognizing the poor market and priced accordingly.
Editor’s Note: I asked Ken for help compiling these graphs.
As with any statistics, there are a few things you should keep in mind while reviewing them:
1. The construction and sale up upper end homes has slowed. We had a lot of building of homes in the $450K and higher range back in the 2003-2004 time frame. Since then the focus has been on “starter” home resales so that will impact the median price for more recent sales.
2. Prices of homes has dropped since the peak in 2004-2005. Since then I would say the drop has been about 15% to 20% depending on the area.
3. Sales tend to peak in the spring (April through June.) It will be interesting to see what the numbers are for May and June this year. Sales have been good due to first time buyers taking advantage of the $8,000 tax credit and rates are around 5.5%. (They were at 4.5% until a couple of weeks ago.)
4. I have found that a lot of young couples have recalibrated their goals. Couples who used to shoot for the stars are now looking at homes with lower monthly costs. You used to see couples going after the $450K to $550K new colonials and those very same buyers are now often looking at homes priced in the mid $300s, or sometimes even lower. A lot of young couples are trying to keep under $250K. It is definately a different market from what we saw five years ago.
5. In spite of what you hear from the media, loans are available. The availability of money is NOT the issue. But credit scores and “debt to income ratio” are factors. Buyers are scrutinized much more than they were a few years ago and appraisers are much more careful when they are evaluating the value of a home. And esssentially no one is taking out mortgages with variable rates.
Also consider the number of rentals becoming available. I’ve lost two rental neighbors in the last two months. One is moving to another location in Marlborough — outside of the sewer district.