Is this the very beginning of the end for this wild ride in real estate?
Now that the most recent month's data is in, real estate stats have certainly plateaued since the May-June price increase. But more importantly, active listings are still up considerably since last year.
The snapshot of July gives us an average home sale price of $586,155. This is almost exactly the same as last month, whereas June experienced a $13,000 increase over May. Sold-to-list ratio is also down again at 97%, compared to a staggering 98.4% in July 2017.
Active listings are the highest they have been in more than two years for the third straight month. We can now declare this a “trend” at the three-month mark. Active listings stand at 1,991, up from the same time last year at 1,766. Sold listings were up since last year from 346 to 396; but this also comes in tandem with a new listings increase from 584 to 608.
Days on the market were also up in July, from 77 compared to 66 in July 2017. With homes taking longer to sell, both new and total active listings on the rise, and closed sales still under 400, everything seems to hint at prices hitting their ceiling in the near future- if they have not already.
Prices are beginning to level out it seems, and certainly not increasing at the rate we saw in 2016 and 2017. Home prices increased 9.8% in the past 12 months, whereas they rose 11.9% in the year 2017.
Predictions and Anecdotes
Our prediction based on the rise of active listings is that prices will level off and the demand will continue pulling back for Staten Island real estate. None of these changes will happen overnight. If prices do start to ease up, it will be slow.
We have been following the surging real estate market here in Staten Island and reporting on it each month for quite some time. Because prices are a trailing indicator (home sales typically take 90 days to close) and not a current indicator, the most important statistic is the high number of active listings approaching 2,000.
Aside from the statistics, we have anecdotal evidence from our real estate team to hint at the market slowdown. Our agents have observed a lull in recent market activity, and the stale inventory reflects that. So many homes are just sitting on the market for extended periods without much activity.
Staten Island homes have become unaffordable for first time buyers with an average household income around $75,000. We have been observing multiple families moving into single-family homes among other measures of financial hardship. Staten Island has always been more or less a stronghold for families and the working class before now.
It’s not that buyers are losing interest in homes here; our economy is still fairly robust and the 5-borough area remains attractive to many investors. But with wages barely rising each year, the dream of homeownership is becoming out of reach for the average household. We will keep track in the coming months to see how consumers respond with their dollars in this increasingly expensive housing market.
Written By Hannah Jay