November was another slow month for Fair Haven home sales, with only 3 homes sold, compared to the 9 sales last November. Last month, this year’s real estate absorption rate (months’ supply) became longer than last year’s for the first time in 2014 (good news for buyers), and it remains higher this month. Our year-to-date statistics still show that 2 of the 4 key real estate indicators look favorable for home buyers (fewer homes were sold and the real estate absorption rate is longer):
Fair Haven Single-Family Home Sales, January 1 – November 30
2013 2014 Comment
Sales 98 83 15% fewer homes sold (good for buyers).
Listings 36 33 8% fewer homes on market (bad for buyers).
Months’ Supply 3.4 3.8 Weaker demand vs. supply (good for buyers).
Median Sale $660,000 $699,000 6% higher median price (bad for buyers).
Fewer sales are good news for buyers because less demand tends to push prices down. On the other hand, fewer listings means less supply, and less supply tends to push prices up. The real estate absorption rate is important because it looks at both supply and demand. It’s a calculation of how long it would take to sell ALL of the homes listed for sale, assuming that homes continue to sell at the rate they have in the past 12 months. There are several ways to do the calculation, but I use both the average number of listings and the average number of sales for the past 12 months.
Even though, on average, there have been fewer homes for sale in the past 12 months, there have been, on average, even fewer sales in the past 12 months, so the real estate absorption rate is longer than it was 12 months ago. Although on the surface that should be good news for buyers, remember that in a “normal market” the real estate absorption rate is between 5 and 7 months; greater than 7 months indicates a “buyer’s market” and less than 5 months indicates a “seller’s market”. So even though the absorption rate is longer, we’re still in a “seller’s market”.
The other bad news for someone looking to buy a home in Fair Haven is that the median price is 6% higher than it was a year ago.
I’ve lived in Fair Haven since 1975, and if you’re considering moving here, please give me a call. I’d love to show you all the great things that Fair Haven has to offer.
P.S.: This was my 300th post! Hope you’re finding the information interesting.
Leonard “Len” Dunikoski, GRI
Diane Turton Realtors – Rumson Office
8 West River Road
Rumson, NJ 07760
(732) 239-0739 (cell) (732) 530-6686 (office)