In 2013, the housing recovery continued across most of the country with sales in the hardest hit areas catching up to inventory that previously had been languishing on the market. While prices increased as a result, nationally the average sale price still remains below the “peak” of the 2006 market. However, in the Rochester market our experience has differed in that because we never had the huge peaks, we also never suffered the tremendous drop in prices either. In fact, our average sale price in 2013 was higher than in 2006 which goes against the trend when comparing to other metropolitan areas.
In many of the local markets, the trend has been steadily shifting from a buyer’s market to a balanced or seller’s market as inventory continued to shrink over the past 12 months. In the two largest markets we are in, Monroe County and Erie County (Buffalo) are hovering around 4 months’ supply (versus five to six a year ago) while outlying counties are hovering between six to eight months’ supply (versus nine to twelve). We anticipate this trend to continue, resulting in sellers being able to continue to get slightly more money for their home.
Interest rates have remained at or near historic lows for the past three years and are expected to remain so into the first part of 2014. This trend can’t continue indefinitely and while no one knows for certain when exactly rates will begin to rise, it’s likely they will go over 5% at some point in 2014.
Sales slowed down somewhat in October due to the uncertainty with the government shut down and there is always a seasonal shift in the market in November and December. I’m anticipating a steady increase due to the pent up demand beginning in January 2014 as buyers become more focused on purchasing before interest rates increase.
It used to be that sellers would wait for March or April (i.e. the “Spring Market”) to list their house but over the past few years, we’re seeing the market pick up earlier and earlier. Consumers are finding that there are benefits to both buyers and sellers who jump into the market in January and February. For sellers, often the buyers that are out at this time of year are very serious and want to buy versus being on the fence. For buyers, there’s less competition meaning a greater chance of getting the home of your dreams versus finding yourself in a bidding war.Follow @NothnagleRE