By Greg Oehler,
Broker/Owner of GMAC Real Estate Fredericksburg
This post is from GMAC Real Estate Fredericksburg's real estate blog The Burg
. To read more Fredericksburg real estate news, analysis & insight, visit The Burg online.
I like watching the Hill Country real estate market! Other people must enjoy keeping tabs on it, too, because I get asked a lot of questions about it.
Our local market is made up of many different segments. There are a lot of market segments to consider before anyone defines the market status for interested parties. I am not sure anyone can give a single answer such as “The market is up!” or “The market is stagnant!”
The Inquirer usually deserves an objective answer describing the particular segment of the market he is interested in learning about. Existing home sales may be up but new home sales may be down. The same condition could apply for low priced homes versus higher priced homes. Other segments include commercial properties, lots, small acreage, and large acreage properties. For today, I am studying the status of our market within the following parameters:
- Residential homes
- Inside the Fredericksburg City Limits
- List Prices from $100,000 to $250,000 (Lower Price Bracket) and from $250,001 to $500,000 (Higher Price Bracket)
- Compared activity 1/1/2008 – 4/30/2008 to 1/1/2007 – 4/30/2007
- Based on Gillespie County Board of Realtors MLS data
Lower Price Bracket
First, let’s take a look at what sales transpired in 2007 as shown on the below chart.
| 1/01/2007 – 4/30/2007
$100,000 - $250,000 List Price Range
(29 total sales) |
|
| Low | High | Average | Median | Total |
| List Price | $112,000 | $247,000 | $182,743 | $179,000 | $5,299,540 |
| Selling Price | $109,900 | $239,000 | $174,719 | $170,000 | $5,066,840 |
| List/Sold(%) | 79.65% | 100.00% | 95.47% | 96.76% | – |
| Price/SqFt ($) | $84.27 | $192.38 | $127.55 | $119.52 | – |
| Days on Market | 26 | 299 | 119 | 93 | – |
Interpreting the chart above for the lower price bracket, we see that there were 29 sales in four months (a 7.25/month average). The Average Sales Price was $174,719 or $127.55/SF and the Median Sales Price was $170,000.
Now, let’s compare the same price range to home sales activity in the same four months of 2008.
| 1/01/2008 – 4/30/2008
$100,000 - $250,000 List Price Range
(26 total sales) |
|
| Low | High | Average | Median | Total |
| List Price | $102,500 | $249,900 | $178,844 | $172,750 | $4,649,950 |
| Selling Price | $98,000 | $239,000 | $169,604 | $167,500 | $4,409,710 |
| List/Sold(%) | 80.00% | 103.77% | 94.71% | 95.48% | – |
| Price/SqFt ($) | $66.19 | $160.42 | $119.13 | $122.50 | – |
| Days on Market | 40 | 289 | 156 | 166 | – |
There were 26 sales during this time frame (a 6.5/month average). The Average Sales Price was $169,604 or $119.13/SF and the Median Sales Price was $167,500.
While there are no significant year to year differences, we see that the Average Sales Price per Square Foot decreased from $127.55 to $119.13 or approximately 6.7% and it is taking about 31% more days on market to sell the home.
Higher Price Bracket
Now let’s take a look at the more expensive homes. Below is the chart for homes priced between $250,001 and $500,000 in 2007.
| 1/01/2007 – 4/30/2007
$250,001 - $500,000 List Price Range
(12 total sales) |
|
| Low | High | Average | Median | Total |
| List Price | $257,000 | $429,000 | $323,183 | $303,000 | $3,878,200 |
| Selling Price | $245,000 | $429,000 | $314,283 | $297,500 | $3,771,400 |
| List/Sold(%) | 91.70% | 100.00% | 96.98% | 97.67% | – |
| Price/SqFt ($) | $99.11 | $155.08 | $134.92 | $139.50 | – |
| Days on Market | 58 | 347 | 164 | 165 |
|
We see that there were 12 sales in four months (a 3/month average). The Average Sales Price was $314,283 or $134.92/SF and the Median Sales Price was $297,500.
Comparing the same price range to 2008:
| 1/01/2008 – 4/30/2008
$250,001 - $500,000 List Price Range
(22 total sales) |
|
| Low | High | Average | Median | Total |
| List Price | $269,000 | $498,950 | $336,021 | $317,450 | $7,392,460 |
| Selling Price | $230,000 | $475,000 | $313,364 | $299,500 | $6,894,000 |
| List/Sold(%) | 76.60% | 100.00% | 93.35% | 94.63% | – |
| Price/SqFt ($) | $90.84 | $193.88 | $138.30 | $139.50 | – |
| Days on Market | 30 | 483 | 185 | 170.5 | – |
There were 22 sales in four months (a 5.5/month average), an increase in the average sales per month of 83%. The Average Sales Price was $313,364 or $138.30/SF and the Median Sales Price was $299,500.
The Average Sales Price went up approximately $3.38/SF or about 2.5% while the total Average Sales Price and the Median Sale Price show very little difference in our year to year comparison. Note that the Average Days on Market in 2008 of 185 days is almost 13% longer than the Average of 164 days in 2007.
Some other market indicators
- In 2007, a total of 41 homes were sold in Fredericksburg (29 + 12).
- In 2008, a total of 48 homes were sold (26 + 22), an increase of 17% over 2007’s sales.
- A quick check of foreclosure postings at the court house indicates no significant changes. We usually have from two to five postings on the bulletin board. I saw two posted earlier in May, but both were older postings from previous months.
- At the current inventory level of 80 listings for sale in the $250-$500,000 price bracket and using the rate of sales YTD through April 30, 2008, Fredericksburg has an inventory of approximately 14.5 months or 1.2 years.
- At the current inventory level of 58 listings for sale in the $100-$250,000 price bracket and using the rate of sales YTD through April 30, 2008, FBG has an inventory of approximately 8.9 months.
First Four Months of 2008 Summary
- For the upper-priced homes up to $500,000, more homes were sold in 2008 (22 homes) vs. 2007 (12 homes) at an Average Price increase of $3.38/SF and the Average Days on Market increased by 21 days or about 13%.
- For homes priced at $250,000 and less, the number of homes sold was down slightly, but the price per square foot dropped $8.42/SF, or approximately 6.6%, while the Average Days on Market increased by 37 days or 31%.
- For both price categories, the Days on Market increased in 2008 from 2007.
Fredericksburg is in pretty good condition compared to other markets we read about. Indicative of this, our higher-priced housing is still appreciating, although it is taking longer to sell them than in 2007.
It appears that homes priced $250,000 and less have taken the biggest hit during the first four months of 2008; however, the 8.9 month inventory supply for homes in this price bracket is not that far off the 6 month supply maximum most appraisers recognize for a healthy market.
We have been advising our Sellers that reasonably-priced homes are still moving. If a home is priced correctly, it will sell. Accurate pricing must account for defects in the condition, dating, and functionality of the home. A home in top-notch condition is usually much easier to sell than one that needs a lot of work.
For you Buyers, it is a great time to buy! We are seeing more Sellers update and repair their homes prior to marketing them. There are reasonably good deals being made on homes in all price categories and interest rates are still hovering around 6%. Please let us know if you could use some help in making a decision to buy or sell! Call our office today at (830) 997-6123 to speak with one of our agents.
Greg can be reached by cell at (830) 456-3622, at the office at (830) 997-6123, or by email.
To read more articles like this, visit The Burg at www.TheBurgBlog.net
The company was cautioning their vendors, such as me, that “as we navigate through this challenging market (my emphasis), our collective ability to provide quality service is paramount to our success” (some paraphrasing involved). Again, very appropriate for today’s real market.