The numbers, just the numbers! The real estate numbers for 2007 are now a matter of history: So how bad is bad? Even for the pessimists, it really is not all that bad. Statewide Single family homes sold at a lower annual rate and a slightly lower average price. In 2006, 8313 house were sold in MLS, while in 2007 7600 were sold. This is a drop of 8.6% of units sold. The median price went from $282500 in 2006 to $275000 in 2007.This is a reduction of 2.85%. This is for the entire State. If you read the headlines or listen to the lead in to any story on broadcast medium, you would think the market is
‘grim,’ but that is not the story the numbers tell. If you have been attempting to sell your house and it is taking longer, that is just a fact of the market.
The story in East Greenwich is more intriguing: Median price of single family homes dropped from $517,000 to $509,000, a drop of 1.5% percent. What is amazing is that 193 houses sold in 2007 versus 171 sales in 2006. Twenty two (22) more single family homes sold in 2007 and increase of 12.9%. In other words, the total dollar volume as reported in MLS went up from $88,407,000 to $98,237,000. Yet the headlines talk about huge drops. It is just not true in East Greenwich.
North Kingstown has not done as well: Average priced from $397,450 to $376,000. individual sales went from 282 to 237. Warwick fared better: the Change in price from $242500 to $230,000 and a Change from 1069 sales in 2006 to 913 in 2007.
So what does this mean? Is East Greenwich an oasis? Or is this the application of some of the oldest rules of real estate? Do you remember that rule: Location, Location, Location? There are several strands of information in the data: First the Correction in East Greenwich began early and appears to be more mild. Furthermore, the sellers as a group were somewhat more pro-active in East Greenwich. They tended to price to sell more quickly.
There are two much more important messages: First, for buyers, people are buying and it is ok to buy. One needs to research the market to make a prudent purchase. Expert advice will be a real help. If you need shelter, it is ok to buy. The second message is more important: Sellers need to price to sell. This is still a Correcting market. The prudent seller will price slightly BELOW the recent Comparable sales and the Competing properties on the market.
One additional footnote: part of the reason that East Greenwich did so well in 2007 is the limited number of foreclosures in town. An individual foreclosure can not necessarily will reduce the value of neighborhood homes. If there is more than one foreclosure, the reduction of value is rather likely. Part of the reason foreclosures are so difficult is the lenders inability to move the house quickly from vacant home to occupied. If a lender moves through that process fast, the negative impact on the neighborhood is negligible.
Seize the truth for these are intriguing times!
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