First a review of where we came from. For Woburn, the market volume peaked in 2003 and prices peaked in 2005, at an annual median price of $397,750. Prices have shown about an 11% pullback since that time. The number of homes sold in 2003 was 254. In 2007, 195 homes sold so the volume has fallen off 23%. So far in the first half of 2008 there have only been 107 sales, so the market volume is low.
There is a strong seasonal effect on the Woburn market with Q1 (Jan, Feb, Mar) and Q4 (Oct, Nov, Dec) being the volume and price lows. This seasonality should be taken into account when looking at any monthly data. 2008 Q1 volume was very low, but Q2 was stronger so the strong summer trend 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, prices are showing some strength. 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.
What this means for homeowners in the near term is that there is still demand for homes and that while sale prices will be down from 2005 highs Woburn appears to be a recovering 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 Woburn Single Family market, there were 95 properties listed August 1. This represents a 17% decrease in inventory from the same time last year. Sales volume in July was again lower than last year with only 17 homes sold. Median sales prices resumed their uptrend at $362,500, although still slightly lower than last year. In July the average time on market dropped to 91 days. Currently we have only a 5 month supply of property which indicates that the Woburn market remains in favor of those selling property. It should be noted that approximately 10% of the homes on the market are distressed properties, Bank owned or Short Sales, so prices will experience some drag.
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.
