In February I mentioned that signs were pointing to a healthy spring market. I was cautiously optimistic as I had two concerns: the extremely low inventory in February and I thought that interest rates would rise.
The low inventory could have led to asking prices rising too quickly and higher interest rates would have meant fewer buyers. What actually happened surprised even the most seasoned Realtors.
Interest rates remained low, which kept the buyers in the market. More importantly, even though many would say there was not enough inventory that came on this spring, we are on track to have the best year since 2002 in number of sales transactions. It was a very active spring market with some amazing numbers and stories.
We have not reached the peak of 2006 in average sales price, but we are close with an 11 percent increase over last year. Current average price in Newburyport is $524,446.
Most spring markets taper off mid-June; this year it went well into July.
The ratio of list price to selling price is 98 percent; the last time we reached this was 2004.
The DOM (days on market) of 106 is trending lower to the best since 2005 and is 50 days lower from 2008 (the highest and worst).
There were many multiple offers on properties. I’ve heard of one buyer that made eight offers at asking or over asking. For the first seven the sellers refused, as they received better offers. The buyer was successful with the eighth (well above asking and waiving the home inspection). The first seven sellers had buyers with extremely favorable financing packages. For the most part the buyers were well heeled this year; many cash offers.
The story that raised most eyebrows was the sale of two properties. It was not the sales price that was of interest as much as it was the price per square foot. Some background knowledge and perspective … everything being equal, understand that smaller properties generally have a higher price per foot than larger properties because of fixed construction costs. That cost is absorbed or watered down in larger properties.