Summer is officially underway, and so far we have seen a mixed bag of real estate news.
One thing I always tell my clients - the national averages are just that N-A-T-I-O-N-A-L! While I do still read what the news players say or what the top media center are reporting, I do take all of it in with some hesitation.
Remember, we live in a bit of a real estate bubble! The national average for a new home falls between $200,000-$300,00. That does not in any way reflect Ridgefield prices. So, while those "national housing price" averages are generally just an FYI in my book, I do stop and listen when the "rates" are addressed. Why, you ask? Well, while our area's average selling price falls somewhere between $800,000 - $900,000 (ie in Ridgefield), most of the buyers in this price point seek out the Fannie's and the Freddie's of the mortgage financing world.
And the even more curious thing is that, even with all of the negative press about the down-turned real estate sector, we are experiencing 30 year lows in mortgage rates!
So what are the biggest headlines this week...
- Experts are saying that housing prices are leveling off or even increasing in some areas (see May versus June single family homes sales below). But why? See what Freddie Mac Chief Economist Frank Nothaft said recently.
- According to a recent CNN Money article "Permits for housing construction climbed in May"! Hip-hip-hurray!
- And my favorite headline...as presented by the Wall Street Journal..."The National Association of Realtors' seasonally adjusted index for pending sales of existing homes increased 8.2% on a monthly basis".
Renting versus Buying
One other interesting piece of information I heard over the last 6-9 months --- although sad, it is quite true --- on average it could cost a renter more money to rent a property per month versus purchasing a home and making a monthly mortgage payment!
So why are rentals so hot these days?
It is believed that the increased number of rentals is due in part to the families who foreclosed on their primary properties in the recent years or who have lost their jobs and can no longer afford the mortgage payment on the 4 bedroom Colonial. So they've sold the family house (probably for less than they paid for it) and are now renting smaller homes. There are other factors, such as recent grads who cannot readily find the entry level positions due to hiring freezes we experienced in 2009/2010. Or even the lack of rental inventory readily available - high demand and low inventory!
Let's look at the numbers:
Single Family Homes Sold (in June 2011) - 30
- Average Selling Price - $827,233 (up from an average of $696,348 in all of May 2011)
- Average Days on Market - 106
Condo units Sold (in June 2011) - 4
- Average Selling Price - $261,375
- Average Days on Market - 52
Oh, and Happy 4th of July. See you at the town fireworks display on Saturday.