Cromford Report Daily Observations:
April 2 - Yesterday we investigated the supply by price range. Today we look at the demand for single family homes, by examining the number of listings under contract:
|Price Range||Under Contract (including UCB & CCBS) April 1, 2016||Year Ago||% Change||Comment||Contract Ratio April 1, 2016||Contract Ratio March 1, 2016||Contract Ratio April 1, 2015|
|Under $100K||155||360||-57%||large decline||85.6||96.6||116.9|
|Over $3M||16||29||-45%||large decline||4.9||6.0||9.7|
From $225,000 to $600,000 we have far more listings under contract that at this time last year. We also see very strong growth for the sector from $800,000 to $1 million.
From $175,000 to $225,000 and from $1.5 million to $2 million we have moderate increases in listings under contract of between 10% and 15%. For the sector from $1.5 to $2 million this goes a little way to mitigating the increase in supply.
The shortage of supply means the market under $175,000 is much smaller than last year, though the contract ratios are much higher between $125,000 and $175,000 showing there is no lack of buyer interest. Below $125,000 there is not much for sale and buyer interest is lower than last year too.
There are significant problems for sellers between $1 million and $1.5 million as well as for those over $2 million. This is because the number of listings under contract is down from last year at the same time that supply is much higher. The contract ratios have slipped compared with April 2015 and this signifies a large shift of negotiation power away from sellers and towards buyers. We should not be surprised to see weaker pricing trends in these price ranges as a result.
April 1 - When we examine the number of active single family listings by price range, we can clearly see the long term shortage of affordable homes, the adequate supply in the mid-range and the glut of luxury homes for sale.
|Price Range||Active (excluding UCB & CCBS) April 1, 2016||Year Ago||% Change||Comment||Days of Inventory|
|$125K-$150K||441||793||-44%||lowest level since 2005||40|
|$400K-$500K||1,903||1,601||+19%||highest active count since Mar 2009||191|
|$500K-$600K||1,229||1,036||+19%||highest active count since Apr 2009||253|
|$600K-$800K||1,337||1,065||+26%||highest active count since Jun 2009||293|
|$800K-$1M||760||683||+11%||highest active count since Aug 2009||384|
|$1M-$1.5M||808||677||+19%||highest active count since Nov 2009||480|
|$1.5M-$2M||465||408||+14%||highest active count since Mar 2010||684|
|$2M-$3M||407||382||+7%||highest active count since Mar 2010||798|
|Over $3M||327||300||+9%||highest active count since Dec 2009||1,219|
From $400,000 upwards we have more active listings than we have seen in the last 6 years, so buyers have plenty of choice and therefore negotiating power.
Below $200,000 we have a chronic shortage of homes available for purchase, and there is precious little to rent too. Here sellers have most of the negotiating power.
The median sales price for single family homes is at $230,000.