- The July median sales price (average of trailing 6 months) showed an increase during the past month to $320,000 and was 5.4% higher vs. July 2008.
- The median sales price in July was at the highest level since the peak in October 2007 ($320,000 vs. $350,000) and the continuing trend this year appears to be up.
On the negative side...
- The number of Longmeadow homes sold in the July 2009 period was significantly lower vs. the corresponding period in 2008 (17 vs. 27).
- 2009 YTD Longmeadow home sales were equivalent to 2008 YTD (91) and significantly lower vs. 2006 and 2007 periods (91 vs. 125- 2006 and 118- 2007).
- There appeared to be a resurgence in home sales during the first four months of 2009 (January - April) ... possibly due to low mortgage rates... but the home sales for the past four months (April - July) were at the lowest levels in the past 4 years.
- 46 out of 91 (52%) homes sold in 2009 were at less than the official Town of Longmeadow assessed value (see figure 2) continuing a trend that has been seen for the past two years.
- The median sales price for July 2009 (average of trailing 6 months) is still 8.6% lower vs. the peak reached in October 2007 ($320,000 vs. $350,000).
Earlier this year it appeared that home sales in Longmeadow in 2009 were on track to be improved vs. 2008 but the recent increases in home mortgage interest rates appear to be slowing down this resurgence. However, with increasing median home sales prices it does appear that a bottom may be forming for the Longmeadow real estate market (as well as the rest of the US). This combined with a recovery economy may lead to a more normally functioning real estate market in 2010.
Below is a chart showing the relationship between recent Longmeadow real estate Sales Prices and Assessed Values (data obtained from Vision Appraisal website). ~50% of the homes sold in 2009 YTD were purchased at prices less than the official assessment value.
The chart below shows that the median sales price (6 month trailing average) for July 2009 continued to increase to $320,000 (5.4% higher than July 2008) but it is still 8.6% lower vs. peak of $350,000 reached in October 2007.
Here is a link to the data for 2006-2009 Real Estate Transactions that were used to develop the above graphs.LongmeadowBiz.com- Longmeadow's #1 Business and Community website
3 comments:
Any investment can be overpriced no matter how great its fundamental value or how secure its prospects. In the absence of a more thorough analysis, it's reasonable to suspect that investments in a market that has been rising for a long time are overpriced. In itself that guideline isn't a signal to sell, it is a signal to make a closer examination.
I appreciate your statistical analyses, but you should note that the official town assessment are as of January 1, 2008. It is not surprising that houses are selling below those assessments. It is surprising that half are selling above those assessments.
Kathy,
Thank you for highlighting this information.
In the past, because the official town property assessments are based upon market values up to 1-2 years old, the offical town property assessment information has usually significantly trailed current market property values and sales prices have been much higher. However, in recent years it has become a reasonable indicator of current market values because of the significant fall in property values.
Regression analysis of the recent 2008-2009 data shows only a fair correlation (~ 80%).
I publish this information for both buyers and sellers as one of many indicators of current Longmeadow property values.
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