NUMBERS! 2010 Year in Review

Here’s the unofficial end of year real estate data.  You know you’ve been waiting for this from the moment the ball dropped…

The Numbers¹ 

I’ll start with the numbers.  2010 looked a heck of a lot like 2009 in most practical ways of measuring the real estate market.  The total number of sales were a little lower, the average sale price was a little higher, and homes stayed on the market another month, on average.

Breaking down the 2010 numbers by town, and even comparing them with 2009, we just didn’t see any earth shattering changes to the market.  The number of sales increased in Barre City and U32, but dropped in the other three towns.  Most notably, Montpelier went from 74 sales in 2009 to 57 sales in 2010.

But, when you look at average sale prices, Montpelier joined Barre City, Barre Town, and Northfield in seeing price increases.  Only U32 saw a decline in home sale prices.  Remember that real estate is unique.  No two properties are the same, so while prices may increase or decrease, we’re almost never talking about identical properties selling in consecutive years.  Another way to say that is that this year’s $175,000 property is different than last year’s $175,000 property.  But still, there were 252 sales this year and, on the whole, sale prices were up 3% from 2009.

One thing that did change fairly significantly was how long it took properties to sell.  Barre City, Barre Town, and U32 all saw average days on the market increase.  Montpelier saw a decrease.  And Northfield blew everyone else away.  An average of 258 days on the market?  There were only 18 sales in Northfield this year, so the sample size was small.  Still, that means that the average home that sold in Northfield was for sale for right around nine months.

2010’s Hot Real Estate Stories

Homebuyers Tax Credit—Remember this past spring and summer, when the federal tax credit was extended to people who bought by June 30?  And you didn’t even have to be a first-time buyer?  Certainly we were going to see buyers rushing to take advantage of that $8000 credit?  Right?  Well, here are the numbers:

So, yes, a larger percentage of this year’s sales took place in the beginning of the year.  But not that much larger.  And while it felt busy in June, it wasn’t really any busier than last June.  Would sales have dropped without the tax credit?  There’s the question…and when I write my Political Economics Year in Review, I’ll weigh in on that.  (Spoiler alert:  I’m not going to write it.)

Historically Low Interest Rates—This one might have had a real impact.  When I was a working as a Certified Financial Planner many years ago, I advised anyone who could get a mortgage for less than 8% to consider refinancing.  I’ve seen rate cheat sheets that didn’t even have 5% on them, as if it wasn’t even conceivable.  And now we have loans for 3.5% for 15 year fixed loans, or 4.25% for 30 year loans, both without points.  Sure, buyers have to have good credit to get those loans, but let’s be honest—that’s cheap money.

Buyers with steady income and good credit found  that the low rates made their qualifying ratios even better.  And many took advantage of it.  Rates are up a bit from what they were a couple months ago, but they’re still low, and banks are still lending money.

Economic Recovery—I’m hearing more and more good economic news.  Unemployment is down a bit.  The stock market has recovered much of what it gave up in 2007-2008.  Consumer spending was up this holiday season for the first time in a couple of years.  Sure looks like we’re steadily moving out of the mess we’ve been in.  

And that’s good, no matter what side you’re on.

Multi-Family Sales

The fact of the matter is that there just haven’t been many multi-family sales in the area.  Sale prices are up in Barre, but there were some good buys this year (Park Street for $107,000 was one of the best buys, but I also liked a four-unit foreclosure on Merchant Street for $89,900).  Montpelier’s sales shifted from primarily 2-3 unit properties in 2009 to primarily 4-6 unit properties in 2010.  Probably a coincidence.  With only 21 sales in the whole market this year, it’s important to remember not to read too much into it.  There’s not enough data to suggest trends, but there are some interesting things to think about.

From time to time I do an informal rent survey, which I send along to multi-family owners and others who may be interested.  Here’s what I put together back in October.

For more about the local real estate market, my analysis and commentary (this is all my own content—I don’t just download this from a website), or just to shoot the breeze, give me a call or send an email.

Also, if you or someone you know is looking to buy or sell, and wants intelligent real estate advice and professional service, please keep me in mind.  I’m always happy to help.

1. Sales data comes from the Multiple Listing Service, and is only reflective of properties that were listed.  Our office is currently compiling the data for all area sales—including direct sales.  The data were not available when this report was produced.