If you read this blog much, you probably have a lot of time on your hands and a high threshold for eye-glazing data.
You also probably know that I am a fan-boy of The Cromford Report. Why? Because they are more often correct than any others I’ve seen –and that benefits the clients who are wise enough to work with our team (hint, hint).
Case in point, their predictions last month were spot on regarding where we would be this month. To quote CR, “(f)or the monthly period ending January 15, we are currently recording a sales $/SF of $130.38 averaged for all areas and types … This is 0.7% below the $131.28 we now measure for December 15 and represents a small slide in average pricing, as expected. Our forecast range was $127.10 to $132.28 with a mid-point of $129.69. Last month’s forecast proved reasonable and the actual result was only slightly above the mid-point of our predicted range.”
I like to compare their county-wide averages to the Historic Trend Line that I often report on. That is condos and single family residents in zip codes dominated by historic neighborhoods, non-distressed and between $75k and $1 million.
I found it interesting that the historic trend line dropped very slightly, while the over-all bumped slightly upward. Cromford folks think all of this is generally a state of equilibrium (balance of sales and purchases), and that’s a good place to be.
The question is whether this is significant. Historic homes tend to out-perform “regular” homes. So, while the price per square foot is $6 higher, above, the trend line is going the other direction.
I think it is too soon to tell. My gut tells me that these prices will start moving upward again as we get away from the Super Bowl and in to the high market months (February through June). Also, I heard of lending rates at around 3.8% for a 30-yr fixed loan. That’s incredible and jealousy-inducing for me, personally (’cause I want that rate!). More importantly, it will probably pump the market.
Cromford is expecting an average monthly sales $/SF on February 15 to be $131.77, which is 1.7% higher than the January 15 reading. This follows a pattern which is common in most years where a stronger February follows a weak January after a strong December.
A little more from Cromford: “We are seeing stronger sales counts in the first half of January than we did in January 2014, 7% higher year to date. However pending listing counts and under contract counts are showing no improvement over last year so our enthusiasm is tempered.”
This tracks with what I am seeing in historic, with some listings sitting on the market for much longer than they should.
They finalize by saying that there is no cause for prices to fall except in a few small areas with excessive local supply.
What does this mean in the Queen’s English? I dunno. But in American English it means that prices are stable, interest rates are so low its almost like free money and that you should jump now if you are thinking of buying.
If you need to sell, the interest rates will help you motivate buyers and the prices are still better than they’ve been in years –just don’t expect strong up-ward pressure any time soon.
Give me a call if you need to make the big jump and we can build a strategy around your specific needs. 602-456-9388.