First a review of where we came from. For Bedford, the market volume peaked in 2004, and the prices peaked in 2005, at an annual median price of $530,000. Prices have shown only a 1% pullback since that time. The number of homes sold in 2004 was 134. In 2007, 140 homes sold so the volume has in fact risen. So far in the first half of 2008 there have only been 35 sales, so this year the market volume is low.
There is a seasonal effect on the Bedford market with Q1 (Jan, Feb, Mar) being the low and Q4 (Oct, Nov, Dec) being somewhat weak also. This seasonality should be taken into account when looking at any monthly data. 2008 Q1 and Q2 volume was very low, but June was strong and July also so the strong summer seems to be holding.
Generally there have been fewer homes on the market this year. With sellers holding homes off the market and thereby restricting the supply, it is seems unlikely that any drop in prices will occur. General economic forecasts seem to hold that 2008 will see the bottom for this cycle, further supporting this view. Real estate markets tend to a 7 year cycle, so with a peak in 2005 it can be expected that the bottom should be in 2008-2009.
What this means for homeowners in the near term is that there is still a stable demand for homes and that while sale prices will be down marginally from 2005 highs Bedford continues to be a high value market. Homeowners who purchased more than 4 or 5 years ago still have significant equity, those having purchased or re-financed recently unfortunately will likely not see price appreciation until 2009 and beyond.
Now for the summary of July results, and where we are today. In the Single Family market, there were only 29 properties listed August 1. This represents a 43% decrease in inventory from the same time last year. July sales volume continued the summer surge with 16 home sales, matching last year's number! Along with the increased volume the median sales prices stabilized around $520,000. The average time on market remained somewhat high at 112 days. The spike in volume reduced the supply of property to only 1.8 months shifting the Bedford market resoundingly back in favor of those selling property. At this time the market is supply limited and needs new inventory to remain at these levels.
For anyone interested in seeing the graphs and numbers behind these comments please go to my website www.MikesREALSolutions.com and look in the community for which you are interested. The reports are available for download as a .pdf file. You can e-mail me at Mike@ MikesREALSolutions.com with any questions.
