Probably the nicest thing to see in April was the solid increase in the median price of an existing home in Albuquerque. At $183,500, that median was a 3.85% increase from last April’s $176,700. That still lags the national ($232,500 in 2016 v. $218,700 in 2015, a 6.3% rise) and western ($335,000 in 2016 v. $214,500 in 2015, a 6.5% rise) median home price increases, but it’s good news for the still struggling Albuquerque market.
Not shown in my chart, that April median is a 2.51% increase over the March 2016 median of $179,000. Nationally, the April median home price was $232,500, which was a 4.97% increase over March’s $221,500.
Year to date (YTD) the median rise is less robust at 2.31% and the median price of a home sold over the first four months of 2016 was $177,000 compared to $173,000 over the first four months of 2015.
Interestingly, we’re seeing a stronger increase in the selling price per square foot (SPSF) of Albuquerque homes. The median SPSF in April was $109, up 4.81% over April 2015 and YTD the price was $107, up 3.88% over the first four months of 2015. That says buyers are paying more for slightly smaller homes and suggests that buyers are price focused and buying smaller homes to stay on budget.
Homes are also selling briskly in Albuquerque, with the median days to sell down to 34, a 24.44% drop from April 2015’s 45 days. The trend holds pretty close YTD as well.
If you are a seller or thinking about selling, note the Mean List to Sell Ratio of 97.58%. That’s essentially the discount buyers are negotiating off the listing prices of homes when they buy them. Over the last year or so that rate has held pretty steadily in the 3% range, though we now see it creeping toward 2%. This is an important selling strategy and needs to be attended to. A well priced home will sell very close to it’s listed price, while a home that’s over priced by even a few percentage points is likely to linger on the market and require price reductions before it sells. More on that later.
Undoubtedly helping bring prices up are two factors. First is the drop in distressed sale homes, in particular, REOs (foreclosed) and Short Sales. Albuquerque saw a 24.71% drop in REOs, from 85 in April 2015 to 64 this April. YTD that drop was not as sharp, only 13.79% (290 in April 2015, 250 in April 2016), but you can see both those factors reflected in the prices. Shorts saw the same kind of reductions.
The second, and probably bigger factor is the tightening inventories. There were 2,435 existing homes on the market in April 2016. That’s a 12.19% decline from 2015’s April inventory of 2,773 homes. Further, buyer demand is very strong and we saw 905 homes go into escrow this April, a 12.98% increase over last. And with 1.29% fewer homes hitting the market in April that inventory pressure is sure to keep pushing prices.
If you want more detailed information than my above chart, info on your own neighborhood specifically, or an analysis of your own home’s value, drop me a line.
– Joe LaMastra, Realty One of New Mexico, May 24, 2016