The Westside had a decent July relative to Albuquerque over all. Unit sales showed big increases for July and for the year to date, average home sale prices as well as the speed of sale held steady while price per square foot actually increased. We did see an increase in REO (foreclosed homes) closings in July, but for the year REO closings have declined.
Strong unit sales of 219 homes was a 30.36% increase over last July’s 168 sales and for the year to date, Westside Albuquerque saw a 16.96% increase in sales from 1,026 in 2014 to 1,200 by the end of July this year. The steady increase is home sales which started this winter has held steady through Spring and early summer’s strong showing is transalting to a reduced inventory of available homes, down 20.10% for July to 823 homes compared to the 1,030 homes that were available in July of last year.
The tighter inventory is great for sellers, but the news isn’t all bad for buyers, since new listings did increase in July by 11.85%, with 321 homes coming onto the market.
Actual selling prices of Westside Albuquerque homes pretty much held steady for July, down about a half percent on the mean and median home price in July was $175,000, up a skosh over last July’s $174,725. That steady July value was counter to the overall Albuquerque trend of declining prices in July, though like greater Albuquerque, Westside prices for the year to date are up slightly both mean and median. The median price of a home for the year in the Westside was $178,000, up 2.23% over the $174,113 median home price we saw over the first seven months of 2014.
Also nice to see is the increased price per square foot. The mean price per square foot of a Westside home was $101 in July (up 3.06% from $98 in July 2014) and the median price $103 (up 4.04% from $99 in July 2014). For the year to date both the mean and median square foot price was up 3.09% from $97 for the year through July 2014 to $100 for the first seven months of this year.
July also saw a bump in the number of Westside REOs, which is in keeping with what we saw overall throughout Albuquerque. Twenty Three REOs closed this July, a 43.75% jump over the 16 that closed in July of 2014. However, for the year there were 143 REO closings in Westside Albuquerque, a solid 11.73% drop over the 162 REO homes that closed through the end of July in 2014. That’s similar to but a slight improvement over the 7.93% drop that greater Albuquerque has seen so far this year.
59 homes sold at or above the asking price on the Westside in July, that’s 26.94% of July’s 219 sales. While that’s a respectable number of full priced sales it hasn’t changes all that much historically over the last few years. At the depth of the price crash in 2008, 22.58% of homes sold at or above list and in 2010, the slow beginning of the recovery here in Albuquerque, 28.49% of homes sold full price or better.
It should also be noted that I’m talking about the sale price verses the list price at time of sale. That list price at time of sale may have taken a number or reductions and often homes don’t sell in Albuquerque until the seller gets the price within sellable range. Look at the “Mean List to Sell Ratio” and Mean Open to Sell Ratio” in the above chart. The List to Sell Ratio (97.13% in July) is essentially the discount homes took which actually sold – the difference in the list price of a sold home and the selling price.
The Open to Sell Ratio is the difference in price between the homes that sold and all the homes that were on the market whether they sold or not. I’d call that a sort of confidence spread. If sellers put their homes on the market and are over confident, there will be a much wider spread between what homes list for and what they sell for if they sell. It’s also an indication of what buyers will tolerate as far as pricing and buying. Sellers may well think the market is stronger than it is and that will be reflected in higher prices, but buyers are looking for better deals and will shun higher priced homes. The question that raises is what happens as the lower priced homes come off the market. Will sales slow if they are not replaced by more lower priced homes, or will buyers begin reaching higher and start pushing prices upwards?
A look at the sales range chart shows a fairly typical Bell Curve type distribution of sales with the bulk of sales (and sales increases) in the $120k to $250k range, which fits with the higher unit sales in July at roughly the same prices. The “Active Listing by Price Range” table shows declines in virtually all available price categories from $250k and down and fairly sharp declines in the $140k and below area. If those lower priced homes aren’t replace in inventory, we’ll either see significantly higher sales prices as we head into winter, or declining sales.
If you’re thinking about selling or buying a home on the Westside and would like a more specific analysis of a particular area, neighborhood or home, drop us a line and we’ll be happy to put one together for you.
– Joe LaMastra, August 28, 2015