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Chester County Real Estate Statistics: July 2010 Comments Off

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The Chris & Caleb Team Assessment: More of the same, Move up Sellers/Buyers have opportunity…

We are pretty optimistic guys, and while the July stats are not “Doom and Gloom”, it definitely ain’t pretty either! Let’s take a look. . .

PENDINGS:

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Pending indicates future closed sales. We at the Chris & Caleb Team refer to this as “Intended Demand”. Pending stats continue to climb out of the incredible hole that the tax credit put it in. Pendings grew to the 350 mark in July, but as you can see, it is still a good way away from where the 5 year trend is and even last years numbers. So, while it is a good sign that pendings are increasing, they are still way off the norm, indicating a slower than usual market.

CLOSED SALES:

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Closed Sales or “Demand” for homes in July was way down. We have been warning of this for the last several months after we saw the pendings drop off after the end of the tax credit. It was only a matter of time before the drop caught up with actual closed transactions. Closed sales were off almost a WHOPPING 40%! But, as we have seen in Pending Sales indicators, this number will most likely not stay down that far for long. We feel strongly the rest of 2010 will most likely be off by about 20% or more in closed sales.

ACTIVE LISTINGS/SUPPLY:

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This number is the probably the most concerning of all the numbers we see. Right now the number of homes for sale is roughly 12% over what the 5 year trend is, and easily the most we have seen in recent history. Economics 101 – Demand slows, supply increases – it means prices come down and everything slows down. With recent news that experts say that the 2011 economy is going to be worse than this years, these numbers are not good. Buckle up folks, as if things are tough already, it’s gonna get tougher.

AVERAGE SOLD PRICE:

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The average sold price is much more of an indicator as to what price range is selling than it is of what our homes are worth in Chester County. It appears that in July, higher end homes were the hot ticket item. We believe this was driven by “Move Up” seller/buyers who were selling their “First time home buyer” homes to Tax Credit buyers and then looking for a larger, move up home. In addition, interest rates have been extremely attractive for higher end buyers who have been on the fence, just waiting for such a time. It is very likely that August’s numbers will rejoin 2009′s numbers.


What Does This Mean?

For Sellers: Unfortunately, nothing new for seller’s. Not to be a broken record, but if you don’t have to sell, you probably shouldn’t. We will say this, one type of home owner that would greatly benefit from selling right now would be what we call a “MOVE UP SELLER/BUYER”. This is someone who has outgrown their current home for one reason or another and wants to buy a larger house. While you won’t get as much for you home as a few years ago, the same goes for the home you want to buy, if not more so. If your home’s value has declined 5% in the last several years, you can be that the larger home that you want is even more on sale. Plus 5% at $200k vs 5% at $400k is quite a difference. Factor in the incredibly low interest rates (4.5% conventional) and this could be the deal of the century. If you are considering selling your home but don’t think you can get enough for it, please contact us. We can get you the insight and advice you need to make the best decision possible. We expect the market to be “depressed” for another several years, possibly as many as 4 or 5. But that also means that what you are going to buy will be “on sale” as well. You may make out better now, than you would in several years. But to know that for sure, let us get you the facts and information you need to make that educated decision.

For Buyers: For those lucky few who are qualified and ready to buy, this in an incredible time to do so. Mortgage rates are historically low at 4.5% for 30 yr conv. or 3.8% for 15 year fixed. With inventory going up, seller’s will have more and more competition which means their prices will have to come down. BUT – you must make sure you align yourself with the right agent. We are confident that we are those agents. To know what your next steps are just get in contact with us!

Next Steps:

BTW, We do have very specific data for every price range and area of town. Want specific data pertaining to your neighborhood or your own home? We have it! Please let me know if you would like a neighborhood-specific analysis by contacting me!

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Posted on: 08-16-2010
Posted in: Chester County, Market Update, Monthly Update, News

Chester County Real Estate Statistics: May 2010 1

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The Chris & Caleb Team Assessment:

After the marathon that March and April were, we knew we would probably be hearing some crickets in May. And boy did we EVER!

PENDINGS: Last month was the worst month on record for pending home sales in Chester County – at least in 10 years, if not 20 or more. The average over 5 years has been around the 500 mark – last month was 251! This drop in activity was expected by The Chris & Caleb Team, though not the severity. Basically what happened was that the activity the market saw in March and April stole from May, June and July. We expect the numbers for June and July to follow the same level of low activity, though we should see some increase, slowly back to the averages. Seasonally speaking, it is all downhill from here as you can tell, June is the last month of the spring market when a majority of the business is really done.

CLOSED SALES: These numbers are tracking slightly better than 2009, but that is most likely due to the activity spurred by the tax credit. By August the tax credit effect will have subsided and we will know truly where the market is tracking. We believe the market will track at or below 2009 levels, depending on what happens in the overall economy.

ACTIVE LISTINGS/SUPPLY: These numbers are also tracking with 2009. The disconcerting fact is that the supply does not appear to be dented by the tax credit activity. Ideally, that number should have come down slightly because of all that activity, and we still may see a slight adjustment as some of the “pending” homes actually settle. In the end, it’s economy 101 – if the demand is low, the supply goes up. As the supply goes up, the price comes down. We believe the rest of the year will be a repeat of 2009 as far as actives go.

AVERAGE SOLD PRICE: Nothing sensational here either. These numbers are tracking with last year as well. The number did see a bump in March, but that is probably due to a combination of jumbo loans becoming attractive again and as a result there was some movement in high price ranges.

What does this mean?

For Seller’s: Unfortunately, your home is worth less than it was in April. The market is slowing down, not only seasonally but due to the tax credit as well. If your home is currently on the market and was before May, then you should seriously look at your pricing strategy and see if an adjustment is in order. Most likely – it is, and certainly not an increase. If you are in a difficult position or need to sell quickly, then you need to be super aggressive with your pricing and marketing. If there is 10+ months worth of inventory and there are less than 1 home selling a month and you are competing with 10 other homes – you better be the CLEAR value and choice. It’s not the time for the faint at heart. . .

For Buyer’s: If you are qualified to buy a home and want to – now is a FANTASTIC time. There is a drought of sorts for qualified, willing buyers, which gives you a tremendous amount of power. Prices are adjusting downward and the interest rates are back below 5%. If you are thinking of buying, now is the time!

Next Steps:

BTW, We do have very specific data for every price range and area of town. Want specific data pertaining to your neighborhood or your own home? We have it! Please let me know if you would like a neighborhood-specific analysis by contacting me!

Supply of Homes for Sale in Chester County:

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Demand- Closed home sales in Chester County:

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Pending Home Sales in Chester County:

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Average Sale price in Chester County:

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Posted on: 06-2-2010
Posted in: Chester County, Market Update, Monthly Update, News

Chester County Real Estate Statistics: April 2010 Comments Off

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The Chris & Caleb Team Assessment:

The tax credit has officially ended!! And good riddance. . . This was a nice gesture by the government to help kick start the market, but it is time to see if the market can stand on its own. That will take another three months while the market flushes out the remnants of tax credit. I firmly believe we will see a slight dip in prices, with the demand falling about 25- 30%. It won’t drastically effect prices but it will be a healthy correction.

Let’s talk about what the numbers are telling us. Let’s start with “DEMAND” or closed sales. Closed sales in April were around 400 mark, hovering just below the 5 year trend and a good deal above what it was this time last year. May and June will continue to see an unusual increase, following the unusual, but expected, increase in pending sales this month. I have to tell you – the last two weekends of April, people were going nuts! It really wasn’t healthy.

Next is the Active Listings or “SUPPLY”. For the month of April, this number jumped above what they were even a year ago. I believe we can, again, contribute this to the tax credit. When supply goes up, prices typically go down. The good news is that this inventory should be eaten up at with the tax credit buyers. This happened late last year in the last month of the tax credit. Let’s hope this is the case, because if a lot of inventory is left on the books, prices will fall more significantly than otherwise.

“INTENDED DEMAND” or pendings is next. This measures how many homes were sold but not settled in April. As you can see this number jumped dramatically. The 5 year trend typically sees about a 10% increase from March to April. This year it saw about a 30% increase! That’s pretty significant, especially considering that May should be even more dramatic. We could even see that number go way above the 5 year trend. Again, this is all driven by the government subsidies and aid of the tax credit.

Last is the “AVERAGE SOLD PRICE”. This one surprised me. Seasonally we see a bit of an increase, maybe a 5%-6% increase over March. This year it was more around the 10% mark.This is a clear indication that homes above the $300k mark are moving, not just first time home buyer homes. We have been watching this segment of the market since the beginning of the year and noticing an increase in confidence. This is also helped by the tax credit, but to a lesser degree than the first time home buyer. If this trend can keep up, which we believe it will, it will mean good news to those who have been thinking of selling their homes in the $300k – $700k. We feel that in the next 3 – 6 months, we will see a lot of “Move Up Buyer” homes selling as the seller’s of first time home buyer homes become buyer’s of move up homes. The Average Sold Pirce will be a telling sign of where the activity in the market is.

What does this mean?

For Seller’s: If you are a “Move Up” seller, meaning you have a home that would sell to a first time home buyer, in the $300k range or under, I have to say that you have missed the boat. The tax credit is over and it may be another 18 – 24 months before you can the type of money for your home as you could have in the first half of this year. If you have a home that is a “Move up” home, meaning it is in the $300k- $700k range and you have been thinking of moving on or need to relocate, now is the time. That market is going to be flooded very shortly with buyers that need to buy. And as always, if you must sell for either reason of relocation, hardship or otherwise, please contact us immediately and we can show you why more than 50 client’s have choosen the Chris and Caleb Real Estate Team for their Chester County Real Estate needs.

For Buyer’s: As a buyer, there is both good and bad news. You have missed the tax credit, but the good news is that prices will adjust and you will have less competition in the market. Interest rates are still historically low, just above 5%, but will not remain there. Now is the time to buy. And if you have a home to sell, as a “Move Up Buyer”, give us a call now, so that we can help you determine the best next step for you and your family.

Active Listings (Supply):

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Sales Close By Month (DEMAND)

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Pending Homes Sales By Month (INTENDED DEMAND)

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Average Sale Price in Chester County

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Posted on: 05-5-2010
Posted in: Chester County, Market Update, Monthly Update, News

Chester County Real Estate Statistics: March 2010 Comments Off

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Chris’s Assessment

March ended up being fairly predictable. I had said in last month that the Tax Credit was going to have an affect on sales and it certainly is. If you look at the “DEMAND” chart, you can see that the number of closed sales are up around the 5 year trend line, not last years low numbers. That’s good and predictable. In fact 56% of the closed sales in March were in the “First time home buyers” market of $300k or under. In fact 60% of those sales were in the $200k-$300k price range, and that is why the average sale price is very low again.

Another positive and predictable sign is the PENDING sales or  what I call “intended demand”. In February that number was lower than 2009, but we also had a TON of snow, which can arguably be said to have affected that number. That number is back up above 2009 levels. I expect and predict that the Pendings for April will be even higher due to the tax credit.  One sign that could be negative, at least for sellers, is that the supply is on track to be at record high levels again. When supply is high and demand is not meeting that supply, prices will come down. Economics 101.

I actually feel the prices are still a bit on the high side and do need to come down. That is why I am also counting the days until the tax credit expires. And no, there is absolutely no news or rumors of it being extended. So, for-real for-real, if you want and can take advantage of it, you better get your butt in gear and call me. So what does all this mean? Let’s find out. . .

For Seller’s: At this point, if you are looking to sell your home, you have all but missed the window of opportunity. If you call me today, and I mean TODAY, we could get you up and running to see if we can get you on the “Tax credit wave”. We have only 3 weekends left before the tax credit, as we know it, is gone. That isn’t much time. In my opinion, your home is worth more now for the next three weeks than it could be for the next 18 – 24 months. So if you need to sell or are considering a move in the next 18 – 24 months, we need to act now.

Need to sell? We love helping homeowners in the Chester County area prepare to sell their home. Contact us now to get our list of the 5 most common ways that Home Seller’s leave money on the table. We’d be happy to help you get the most for your home.

For Buyer’s: You only have 3 more weeks left to take advantage of the $8000 tax credit. If this is important to you then you need to act now. In addition, mortgage rates have been inching up. At the last update, rates were around 4.875% for a 30 yr conventional loan. Now they are at 5.25% and climbing. Every 0.5% increase will increase your monthly payment by about $50. There is no telling where they will be at the end of this year, but it is safe to say not as low as they are now.

Right now, as a buyer, your purchasing power is at a high point. If you have some cash set aside and you qualify for a good mortgage, then you have the power to buy. That puts you in a VERY good position. I highly recommend you take steps to become a home owner. If that is you, please contact me, as I can help you put together a plan to get there.

Active Listings (Supply)

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  • As predicted, supply is on the rise.
  • Demand has increased which is good
  • It would be better if the increase in supply were to ease off a bit creating less inventory and therefore a more centrist market.
  • Next month will probably follow a similar pattern by increasing. I’d like to see it not increase as much as last year and have the tax credit eat into a bunch of that supply.

Sales Closed By Month (Demand)

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  • Big increase in March in closed sales. It appears as though the good weather brought out all those deterred by the snow.
  • The increase is bigger than seasonally expected, I believe, clearly due to the tax credit.
  • Hopefully this level of demand is sustainable over the next several months to help decrease the amount of inventory.
  • I predict that the demand levels for April and May will be higher than the 5 year trend line, strictly due to the tax credit.

Pending Home Sales by Month (Intended Demand)

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  • Last month I said that March’s pending number was important and one to watch. It didn’t disappoint. It made a big jump that made up for the big decrease in february.
  • I believe April is going to be a huge month for Pendings. There are a lot buyers looking to cash in on the credit and April is the last month to do that.

Average Sale Price

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  • As it was from September to November of 2009, the average sale price is once again flirting with record low numbers.
  • 56% of activity in March was in the under $300k price range due to the tax credit.
  • This number DOES NOT reflect home values in Chester County, only sale price.

Offers of Help

BTW, We do have very specific data for every price range and area of town. Want specific data pertaining to your neighborhood or your own home? We have it! Please let me know if you would like a neighborhood-specific analysis by contacting me!

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Posted on: 04-8-2010
Posted in: Chester County, Market Update, Monthly Update, News

Chester County Real Estate Statistics: February 2010 Comments Off

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Chris’s Assessment

First, let me point out something that is somewhat obvious… I have changed my charts a bit, hopefully for the better. I’d love your opinion! I changed them to make them simpler. Now what you are looking at is the line for the current year, last year, and then the 5 year trend line. Previously, there was too much going on. I hope this is better.

For Seller’s: I’ve said it before, and I’ll say it again: If you are planning on selling your home in the next 24 months, for whatever reason, NOW is the time to do it. With the tax credit in play, we are going to see more activity between now and the end of April as, I believe, we will see in a long time. “Don’t worry about it, the government will extend the tax credit. . . .  right?” Highly doubtful. For many reasons. Even without the tax credit, the chart showing the average sale price shows that between March and July is when you will get the highest price for your home. Even the pending chart proves this as the majority of the activity in the market is done between March and July.

Is now the time to sell? I talk with home owners on a daily basis who are asking this specific question. A general rule to follow when determining if now is a good time to sell:

  1. Move-up: if you are selling a home and looking to ‘move-up’ or buy a more expensive home, the very best time to do this is when the market is down (like now)
  2. Move-down: if you are selling a home and looking to ‘move-down’ or buy a less expensive home, the very best time to do this is when the market is hot (not now)

Need to sell? We love helping homeowners in the Chester County area prepare to sell their home. Contact us now to get our list of the 5 most common ways that Home Seller’s leave money on the table. We’d be happy to help you get the most for your home.

For BUYERS: It’s simple, I’ll say it again:

  • Home prices are low
  • Interest rates remain low
  • you get $8000 for buying a home as a first time buyer, or $6500 if you currently own a home.

Right now, as a buyer, your purchasing power is at a high point. If you have some cash set aside and you qualify for a good mortgage, then you have the power to buy. That puts you in a VERY good position. I highly recommend you take steps to become a home owner. If that is you, please contact me, as I can help you put together a plan to get there.

Active Listings (Supply)

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  • Seasonally, the increase in supply is fully expected
  • It is at a significantly higher increase than usual and over last year.
  • The rate at which it is increasing is a bit concerning. What will be very telling is if the rate of increase continues.
  • If demand were keeping up with supply, this would be a good sign, but it is not. Not a great sign.

Sales Closed by Month (Demand)

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  • Demand is down, and I don’t take that as a good sign. I thought initially maybe it was due to all the snow, and that could be, but these are homes that went pending 40 – 60 days before. The snow wasn’t in effe then.
  • Last year at this time the demand had increased over January, and the fact that february’s number is going against the trend is not a good sign.
  • Next months pending number will be a very telling sign as it sets the stage for the three best months in real estate sales in Chester County

Pending Homes Sales by Month (Intended Demand)

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  • Again, another number that is bucking the trend and it’s not a great sign. Unlike the previous chart, this WAS effected by the snow, as there were several weekends that kept people inside.
  • As said, the pending numbers for March will be very important. Seasonally, those numbers jump way up. Let’s see what happens. . .

Average Sale Price

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  • One “happy fact” from this month is the fact that the average sale price is right in line with the 5 year trend (bright red line).
  • This is mostly due to the fact that higher end/priced homes have been moving the last couple of months, and the first time home buyer market has cooled of, which has pushed that average back up.
  • Due to the “Tax Credit Effect” we will probably see that average sales price drop over the next several months. This is not an indication of value, just sale price.

Offers of Help

BTW, We do have very specific data for every price range and area of town. Want specific data pertaining to your neighborhood or your own home? We have it! Please let me know if you would like a neighborhood-specific analysis by contacting me!

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Posted on: 03-4-2010
Posted in: Chester County, Market Update, Monthly Update

Chester County Real Estate Statistics: January 2010 Comments Off

Overview

Chester County Real Estate Statistics January 2010

Statistics by School Districts

Chris’s Assessment:

SELLERS: As noted last month, the inventory has taken a dramatic dive due to the tax credit. This means there is less competition. We are about to enter into the spring market, so inventory will begin to increase again. But, the extended/expanded tax credit will be pushing people to look for homes earlier than what is typical. So there is a great opportunity there for the right sellers. You can grab this anxious market and get a decent price for your home, if it is a “First time home buyer” home, which is typically $300k or less. There is no crystal ball, but with the tax credit plus fantastic rates, I believe that if you are considering selling your home in the next 24 months, NOW is the time to do it. The conditions may not be this good for a couple of years.

Is it a good time to sell? I talk with home owners on a daily basis who are asking this specific question. A general rule to follow when determining if now is a good time to sell:

  1. Move-up: if you are selling a home and looking to ‘move-up’ or buy a more expensive home, the very best time to do this is when the market is down (like now)
  2. Move-down: if you are selling a home and looking to ‘move-down’ or buy a less expensive home, the very best time to do this is when the market is hot (not now)

BUYERS: It’s simple:

  • Home prices are low
  • interest rates remain low
  • you get $8000 for buying a home as a first time buyer, or $6500 if you currently own a home.

Right now, as a buyer, your purchasing power is at a high point. If you have some cash set aside and you qualify for a good mortgage, then you have the power to buy. That puts you in a VERY good position. I highly recommend you take steps to become a home owner. If that is you, please contact me, as I can help you put together a plan to get there.

Active Listings (Supply)

Active listings for Chester County January 2010
Seasonally we are at a low point for inventory levels. When you look at the graph, one thing that I notice is that Supply is at a lower level for the month of January than it has been for three years. That’s a very good sign. Come June we will have a much better idea of whether the inventory will stay low or not, and that depends on what the demand is.

Sales Closed by Month (Demand)

Closed Sales for Chester County January 2010

Just as with supply, we are at a seasonally low point for demand. The next couple of months will be very telling of where the market is and is going. I have personally seen a tremendous amount of interest and activity in real estate. More than this time last year. I believe this Spring market is going to see a lot of activity.

Average Sold Price

Average Sold Price for homes in Chester County January 2010
After seeing the Average Sold Price (ASP) take a nose dive in the fall of 2009, due to the heavy activity under $300,000, we are seeing the ASP start to creep back up. January started out 14% up from the January 2009. That is another positive sign for a market recovery.

Sold To List Price Ratio (SLPR)

List to sale price ration in Chester County January 2010
The SLPR still seems to be indicating that the market is going to stay down. But I generally think that the homes that sold in January were put under contract in November/December. What was going on in those months? For the most part buyers that might have missed the tax credit and were trying to get a deal. It may have also been home owners that were getting desperate to sell and were willing to take less for their homes. There is no way to tell for sure. I would be generally surprised if the SLPR stays in the low nineties over the next several months. If it moves to the mid nineties, then that would be a great indicator of the market leveling out.

Offers of Help

BTW, We do have very specific data for every price range and area of town. Want specific data pertaining to your neighborhood or your own home? We have it! Please let me know if you would like a neighborhood-specific analysis by contacting me!



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Posted on: 02-6-2010
Posted in: Chester County, Market Update, Monthly Update
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