Luxury Market Update Year End for Connecticut 2009
In the last posting we defined the luxury market for the purpose of this writing as $1-$3M, $3-$5M and $5M+. We also reviewed the development of the market over the first nine months of the year.
Real estate has had an interesting ride since the fourth quarter of 2008 as a result of the challenges in the economy and the financial system in particular. Also, substantial expectations have been put on the new administration to take steps to stimulate the economy and establish some balance in the financial system / lending sector.
So, you might wonder how did the high-end market end for 2009?
In comparing the year end sales in the $1-$3M range from 2007 to 2009 it was interesting to see that although the number of unit sales dropped significantly year-to-year, the average sales price didn’t. In 2007 there were 2009 units sold, compared to 1279 in 2008 and 954 in 2009. The average sales price went down from $1.6 to $1.5 million (-6%) over the same time. Interestingly the average list prices for sold properties were constant at about $1.7 million for the whole period reflecting a net change between 2007 and 2009 of a 1.4% decrease. There was a significant change in new listing inventory over the past three years in this price range with 4838 listings in 2007 and only 3692 in 2009. This corresponds to a drop in listings of 24% over the two-year period.
The charts below represent the change in new listing inventory as well as the change year-to-year (orange) and the cumulative change (green).
As we go up in price point to $3-$5M we see the same trend. Unit sales dropped significantly year-to-year, but average sales price and average list price for sold listings show little change.
In this price range there were 285 units sold in 2007, 161 in 2008 and 112 in 2009.The average sales price dropped from $3.6 million to $3.4 million (-6%) during the two-year period. Average list price of units sold varied between $3.8 and $3.9 million (net change of 1%) and consistent with what we saw in the lower price range.
New listing inventory at this price range follows the trend for the $1-$3M range with 679 listings in 2007 and 507 in 2009, a drop of 25% over the two year period.
Let’s take a look at the $5M+ range. We can see some differences here compared with the lower price points, even though the drop in units sold shows the same trend – from 161 in 2007 to 80 and 68 during the following years. Interestingly in this sector the average sales price was higher in 2008 and 2009 than it was in 2007. The average sales price in 2007 was $7.2 million while it was $8 million in 2008 and $7.3 million in 2009. This corresponds to a price increase of 11% between 2007 and 2008 and an increase of 2% over the two-year period. The average list price for sold listings shows a positive trend – $7.8, $8.9 (+14%) and $8.8 (-1%) million respectively, with an increase of 13% over the 3 year period.
In this price range we can see that there has not been the same drop in new listings as for the lower price points. There was a drop from 368 to 318 (14%) between 2007 and 2008. However, this was compensated slightly by a 2% increase in 2009, a 12% drop over the 3-year period and significantly lower than the prior price points.
If we take a closer look at the development during 2009 we can see a significant increase in activity during the second half of the year for all price points. For the $1-3 million range, the units sold during the second half of the year were 626 which is an increase of 91% compared with 328 sold during the first half of the year. The relative increase is even higher for the other price points – $3-5 million shows an increase of 150% from 32 to 80 and $5 million+ a 124% increase from 21 to 47 between the first and second half of 2009.
As buyers become more confident, and the numbers seem to reflect that, the unit sales should continue to rise for 2010. We should remember, though, that the average supply of inventory is up considerably compared with two years ago for all price points. In the $1-3 million range the supply of inventory has increased from 13 to 27 months, in the $3-5 million the corresponding increase is from 15 to 43 months and finally for $5 million from 23 to 54 months. Consequently, there is a lot for a buyer to choose from and sellers need to take note of this when pricing their home for sale.
Luxury Market Update Year End for Massachusetts 2009
For the purpose of this writing we will define the luxury market as properties with a price point of $1-$3M, $3-$5M and $5M+. We also reviewed the development of the market over the first nine months of the year.
The Industry has experienced an interesting ride since the last quarter of 2008 with the challenges in the economy and the financial system in particular. Substantial expectations have been put on the new administration to take steps to stimulate the economy and establish some balance in the financial and lending sectors.
So you might wonder how did the high end market end for 2009?
In comparing the year end sales in the $1-$3M range from 2007 to 2009 it is interesting to see that although the number of unit sales dropped significantly year-to- year, the average sales price didn’t. In 2007 there were 1872 units sold, compared to 1429 in 2008 and 1210 in 2009. The average sales price went down from $1.5 to $1.45 million (-3%) over the 3-year period. Average list prices for sold properties were constant at about $1.5 million for the whole period.
There was not a significant change in new listing inventory over the past three years in this price range with 3976 listings in 2007 and 3699 in 2009. This corresponds to a drop in listings of 7% over the 3-year period.
The charts below represent the change in new listing inventory as well as the change year-to-year (orange) and the cumulative change (green).
As we go up in price point to $3-$5M we see the same trend. Unit sales dropped significantly year-to-year, but average sales price and average list price for sold listings show little change.
In this price range there were 122 units sold in 2007, 91 in 2008 and 65 in 2009. The average sales price dropped from $3.5 million to $3.4 million (-4%) during the 3-year period. Average list price of units sold varied between $3.9 and $3.8 million.
New listing inventory at this price range increased significantly from 2007-2009 with 284 listings in 2007 and 334 in 2009, an increase of 18% over the 3-year period.
Let’s take a look at the $5M+ range. We can see some differences here compared with the lower price points, even though the drop in units sold shows the same trend – from 32 in 2007 to 24 and 16 during the following years. Interestingly, in this sector the average sales price was higher in 2008. The average sales price in 2007 was $6 million while it was $6.8 million in 2008 and $5.3 million in 2009. This corresponds to a price increase of 10% between 2007 and 2008 and a decrease of 20% between 2008 and 2009 with a net change of 13% over 3-years. The average list price for sold listings shows a change of- 7% over the 3 years.
In this price range we can see new listings did not change significantly year-to-year. There were 101 new listings in 2007 compared to 95 for 2008 and 96 for 2009, resulting in a 5% drop over the three years.
If we take a closer look at the development during 2009 we can see an increase in activity during the second half of the year for all price points. For the $1-3 million range the units sold during the second half of the year were 781 which is an increase of 76% compared with 443 sold during the first half of the year. $3-$5M shows a 64% increase in the sales from the second have over the first half of 2009 with 41 sales after July and 25 sales the first half. The $5 million+ showed the least change of 13% between the first and second half of the year with 8 sales for the first half and 9 for the second.
As buyers become more confident and the numbers seem to reflect that, the unit sales should continue to rise for 2010. We should remember, though, that the average supply of inventory is up considerably compared with two years ago for all price points. In the $1-3 million range the supply of inventory has increased from 12 to 22 months, in the $3-5 million the corresponding increase is from 21 to 39 months and finally for $5 million from 79 to 88 months. Consequently, buyers have a wide choice of inventory: and sellers need to take note of this when pricing their home for sale.
For more details on market data visit raveis.com
Data provided by Realty Marketing Update
Submitted by Angela Thelin, Managing Director, Exceptional Properties, William Raveis Real Estate, Mortgage and Insurance.
Posted by angela+ in Exceptional Properties
Tags: bill raveis, luxury market, luxury real etate, new listings, price increase, Raveis In the News, Raveis.com, William Raveis
February 12th, 2010 at 7:05 pm
wow great date ….the media should have this info
February 13th, 2010 at 5:35 am
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