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January Listed Home
Sales Up; Prices Soft
The year 2011 has started out in positive territory for the area Association of Realtors. January 2011 sales volume for single family homes of all types was up by 6% compared to January 2010.
Existing home sales have dominated the overall realty market for quite some time. Annual 2010 sales volume also ended in positive territory with a 9.8% improvement over 2009. In terms of actual sales, there were 136 more 2010 listed single family home sales than the year before.
All this "success" comes as overall price averages continue to fall. The January average sales price was -12% lower that January 2010's. Comparing January 2009's average price with January 2011's, a two year span, shows a differential of -25.5%.
The average price for a traditional winter visitor property actually rose briefly last year. While prices were still down last month, 2-bedroom homes showed the least devaluation. There is a good chance that visitor demand may again drive prices back into positive territory this month but only for these smaller dwellings.
Visitor participation in the realty market was much like local behavior during 2009. Sales plummeted for all realty products, existing and new.
During 2010, visitors sales recovered a bit faster than the overall market but that only came in combination with government tax incentives.
The attraction of even lower prices this year has again brought them out as buyers, at least for a few more weeks.
Further confirmation is seen in brand new residential sales with a full third of last month's sales to visitors. Of 26 January sales, 9 were visitor lot situations.
As for the remainder of the year, prices will continue to fall by another -4% to eventually include visitor properties as we enter summer. We also expect sales composition to remain primarily with existing home sales rather than new building.
We'll reconsider this forecast once we receive sales totals through at least May this year.
As a final comment on this subject, the dispersion of January sales is quite interesting. Using $100K ranges, we find the sales dispersion to look like this (% = proportion of all monthly sales):
Sales <$100K - 48%
Sales $100K to $200K - 42%
Sales $200K to $300: - 8%
Sales >$300K - 2%
Assuming increased demand promotes price rise, the above table tells you where the potential is.
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Peak Visitor Presence NOW!
They're here! This commentary coincides with the peak visitor presence we see each year. Assuming that the weather stays moderate, we may expect this crowded condition to continue for the next few weeks.
As we write annually, we find that any heat streak with temps above 80 degrees for three consecutive days causes some loss in visitor presence. While this sounds absurd, we've done the research that provides substantial evidence of this behavior. Until a few years ago, we always saw a reduced March presence if February had these hot conditions. 2008's season changed that statistical evidence but we still believe is does cause losses. The point here is to hope for continued temperate weather!
After a record presence some years ago, subsequent visitor counts have fallen due to the recession. Last season produced some recovery numerically but visitor spending remained subdued. Early signs this year indicate that visitor influence may promote accelerated recovery with increased spending. They're participating more in realty sales with the hope that this will spill over into our other sales sectors.
We began our 4-part, monthly visitor count a few days ago starting with February park occupancy. We'll have that number out in our next commentary. Although several parks report 100% occupancy, there are still at least a few hundred vacancies. They won't be 100% full. Factually, we've never seen that anyway although we've seen that statement before in past media reporting.
We also expect a continued population increase for visitor-owned occupancies. Remember that we lost ground in this category over the past two years so we have yet to see if the net result is more people than "ever." Some increase was already established last month so there is a guaranteed "plus" for a higher than last year count for this category. It may not, however, be more than the historical peak but could be close.
On a final note, we still don't have housing permits from one jurisdiction. We'll comment on that once we get them in!
- Paul
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