Home values were up a substantial 1.97% in the March 2006 BloodhoundRealty.com Market-Basket of Homes. Average sales prices were up more than $5,000, from $260,645 in February to $265,778 in March. Values are still down slightly more than $4,000 from the December 2004 high of $269,875. Market-Basket homes spent an average of 62 days on market, up four days from February.
The month’s activity was actually stronger than the raw numbers indicate, with many homes selling at or above list price. A few deeply-discounted properties pulled down the average, but average discounting netted out to only 1.37%, down from 1.42% in February.
A total of 189 Market-Basket homes were sold in March, up from 145 in February. As noted in January and February, the early months of 2006 very strongly resemble the first quarter of 2004. The one significant difference is that overall inventories are substantially higher. For example, there are now 1,209 homes available for sale in the Market-Basket, which would imply an absorption rate of 6.4 months. A six-month absorption rate is considered normal.
“If the Spring selling season is everything it should be,” said BloodhoundRealty.com Broker Greg Swann, “then we have no problem. Right now there seem to be a lot more sellers than buyers, and the religious holidays in April could slow things down. But if the market heats up with the weather, we should be fine.”
Based on the idea of the Consumer Price Index market-basket of goods and services, the Market-Basket of Homes uses average sales prices for a small subset of all Valley home sales to get a clearer idea of what is happening in the middle of the bell curve. The alternative method, striking a median among all closed transactions, introduces too many extraneous factors to provide a reliable indicator of what is happening to prices for those homes that are most avidly desired by the greatest number of people. To that end, the Market-Basket of Homes looks at sales prices for MLS-listed suburban homes from 1300sf to 1900sf built in 1998 or later, the homes that drive the resale market.
The BloodhoundRealty.com Market-Basket of Homes is updated monthly and is always available at http://www.BloodhoundRealty.com/MarketBasket.pdf
