Strange things seem afoot as statistics appear to contradict themselves. But with a closer look, we can still see a trend in the Staten Island market.
We have been commenting each month for awhile now on a market slowdown. Note that this is different from a market decline. Prices are still climbing up year over year, but not as sharply as they have in previous years.
Don’t Be Fooled By Statistical Outliers
Now that October’s numbers are in, the average home sale price in Staten Island was $582,619. Higher than September’s $572,545, and also higher than October 2017’s $550,076. Prices are rising overall, but the year over year gap is shrinking.
To see this, we have to look deeper than year-over-year numbers for just one month. That is because October 2016 had the highest average sale price of every month that entire year: $531,118. This makes it a statistical outlier. Overall, prices jumped an average of $52,000 from 2016-2017 so it would be misleading to look only at the $19,000 price change from October 2016 to October 2017.
So far, this year has experienced a 6.5% average price increase over last year, or about $34,500. 2016 and 2017 each saw gains around 11%. We look forward to doing a yearly analysis of all prices for the past several years once we have end-of-year data for 2017.
Though prices are still up, our realtors have reported slower market activity. Despite overall increases, we have been observing large numbers of price reductions and lower total sales.
Inventory Also Remains At Two Year High
Market fundamentals are still fairly strong in the seller’s favor, but only if their home is priced right.
When we look at inventory, virtually nothing has changed for six months now. This establishes a solid trend. October’s active listings were 2018. Since May, active listings have ranged from 1,975 to 2,054. For the same period in 2017, they ranged from 1,576 to 1,798. This shows how much harder it has become to move inventory.
Last month, just 377 homes were sold. This is way out of line with amount of new listings. Home sales usually close in 90 days, and new listings in July were 612. This means around 40% of these homes have not sold. Since most any home can find a buyer for the right price, that means that around 40% of these homes are probably overpriced.
But it is not only low-priced homes that sell. Our own realtors still do close on homes above the $700,000 mark if they are priced correctly. Two family homes, which obviously fetch higher price points, are particularly hot. The key to pricing a home correctly is to study market conditions in your own neighborhood.
For example, if you own an attached three bedroom townhome and similar homes nearby are selling for $450,000, don’t blame your realtor when your home does not sell for $575,000.