The 3rd Quarter has come to a close with the end of the year fast approaching. There’s also a lot happening in the housing market. This quarter and year overall has been characterized by reasonable pickup in the housing marketing nationally and locally. Case-Shiller indexes have been positive in 20 metro-areas for 3 consecutive months-the first such move since the summer of 2010. Foreclosure inventory is dwindling in many parts of the nation. Demand is increasing for single-family, new construction and foreclosures (many of which are being picked up by investors). And, perhaps most significantly,interest rates are still near historic lows. The Fed’s decision to move forward with QE 3 has spurred a large purchase and refinancing demand. In fact, as The New York Times reported this morning, “Federal stimulus has ignited a boom in mortgage refinancing, benefiting both homeowners and banks. And the good times could continue as the government steps up its support of the broad housing market.”
Now, let’s put things into perspective. We have just released housing numbers for the 3rd quarter on raveis.com. The northeast has certainly experienced some trends that are unique to the rest of the country, such as its proximity to the Wall Street crisis in 2008. However, as you’ll see below, average sales prices have noticeably increased in September, as well as the 3rd quarter, in many key markets. Take a look at key statistics below. Are these numbers similar to the patterns you are seeing in your hyperlocal markets?
4th Q and 2013 Predictions
The path ahead for the real estate market looks to be quite a bit brighter everyday. The Fed’s move to purchase mortgage backed securities, super low interest rates and stabilizing prices are bringing buyers to the market. There are a few items to put on the “be concerned about” list, namely, upcoming additional regulation to the mortgage market being introduced by the CFPB. This regulation is set to be finalized by January, 2013. Should the regulations become standardized, this could have a drag on the mortgage industry, thereby impacting the real estate market.
On a more localized scale, many of our key markets are doing extremely well. CT sales prices are up 15% and the sales-to-list price ratio of 94% is indicative of stabilizing prices.
A market that is quite unique and is setup for a robust 4th quarter is Massachusetts. In fact, several key markets, including Boston, Back Bay, Lexington and Wellesley are seeing a 3-5 month supply range. With an incredibly tight supply and eager buyers, MA is certainly a seller’s market.
How has your local market fared in the 3rd Quarter?