Market leading indicators show concern, but are not yet reflected in the most recent home sales report.
How high will home prices continue to climb?
They haven’t come down from their peak yet, as it turns out. Although home sale prices in Staten Island have bounced around slightly over the past few months, June’s average home sale price climbed nearly $20,000 over May’s to reach $586,941.
We have learned by now how difficult it is to predict where prices will be headed in the coming months, and that one should exercise caution when establishing trends. Even though prices changed little for four months, we saw the same thing happen last fall before jumping up $22,000 in a single month.
Not only was there a sharp price increase, but reduced days on the market showed that homes are being snapped up quickly. In June, the average home sold in just 68 days. In May it took 82. Seasonally adjusted, days on the market was exactly the same in June 2017. Though a home also sold in 68 days one year ago, the average home sale price was $548,665- a one year increase of almost $40,000.
Housing Demand At Odds With Actual Sales
Yes, the Staten Island market has proved to be a conundrum lately. The amount of active and sold listings is a particular head-scratcher. Active listings, while level with last month, are still at a two-year high. At 1,931, this is also 218 more on the market than exactly one year ago.
The amount of sold listings is also down since June 2017, when Staten Island had 401 sold homes. Last month, 383 homes were sold. Though a slight increase over May, this is still a very small sample size. This makes it difficult to really analyze home values and report on them accurately.
We can see a huge discrepancy too between the list price of homes that sell and those that don’t. An active listing in June averaged $716,340; homes that actually sold were listed for $606,182. Keep in mind that accepted offers are slightly below asking most of the time, hence the discrepancy with the average sale price of $586,941.
The moral of this story seems to be that success really lies in pricing your home correctly. With the average sold listing being $110,000 less than the average active list, it’s safe to say that a deluge of overpriced homes simply sit on the market thanks to their owners’ high egos. We could list a baseball card on EBay for $1 million. Does that mean it’s worth it?
Listen to your realtor when they give home price suggestions, even if it isn’t what you want to hear. It’s not only what is better for your agent, but for the seller- no one makes money when a home sits on the market years.