Taos Real Estate Market Data - Presented by The Lora Company
DECEMBER 2011
YEAR-END MARKET DATA AND COMMENTARY
TOTAL MARKET – ALL CATEGORIES OF PROPERTY (single-family homes, condos and townhouses, multi-family, land, and commercial):
DECEMBER 2011 vs. DECEMBER 2010:
# of Closed Sales DECREASED from 29 to 19 (-35%)
Dollar Sales DECREASED from $7.0 million to $4.4 million (-37%)
YEAR-TO-DATE (12 months – entire year)
# of Closed Sales DECREASED from 281 to 229 (-19%)
Dollar Sales DECREASED from $76.7 million to $53.3 million (-30%)
Please refer to the chart below for detailed data.
The year finished on a down note, as December sales were well below December of 2010. For the entire year, there were only two months (January and September) in which sales exceeded the same month last year. Confounding our expectations at the beginning of the year for a slight market upturn in 2011, continued bad economic and political news worked to keep buyer sentiment negative.
SINGLE-FAMILY HOMES
Unit sales decreased this December compared to last December, from 18 to 11 closed transactions (-39%). Dollar sales for the month decreased from $4.9 million to $3.6 million (-27%).
For the full year 2011, the number of single family home units sold was 153 compared to 179 last year, a decline of 15%. Dollar sales were $40.4 million vs. $55.7 million last year, a drop of $15.3 million (-28%). The Taos market peaked in 2005, with 351 homes sold at a total dollar volume of $116.7 million for that full year; therefore, 2011 was a decline from the peak of 56% in units and 65% in dollars.
(Please see the link to the chart below this report illustrating sales data for the past eight years.)
Median price is the price at which an equal number of homes sold above and below. For the full year 2011, median price for single-family homes sold was $225,000 vs. $285,000 in 2010 (-21%). The average (mean) price decreased from $311,100 to $263,900 (-15%). In 2007, the median was $325,000, and the average was $379,900. So, to the extent that this is a meaningful comparison, 2012 prices are down about 30% from the peak.
Median and average prices are affected by the mix of homes sold, as well as by actual falling prices. During the past two years, an increasing proportion of sales have been at the low end of the market, thus pushing the averages down. For the year just ended, 24 of the 153 homes sold were below $100,000; 42 were below $150,000. The chart below shows sales by price segment for 2012 and for 2007, indicating the sharp increase in the percentage of sales below $300,000.
Price Discounting - For the entire year 2011, the actual sales price averaged 8.4% less than the last asking price when the property went “under contract.” The discount from original asking price averaged 23.5%. Many listings started at asking prices that were unrealistically high for the current market.
Foreclosure sales have had an impact on lower prices. They accounted for 44 of the 153 houses sold (29%). This does not include “short sales” (in which the net sales proceeds are less than the amount owed on the mortgage loan). Foreclosures will probably remain a significant portion of the market next year. We sense that there are owners who have been holding on during the market decline but who won’t be able to indefinitely.
Inventory - The number of single-family houses on the market available for sale at the time of this report was 336, a decrease from last month of 19 units (-5%). Some sellers take their properties off the market during the winter months. Peak inventory was 518 in September 2008. Current inventory and full-year sales by price category are:
2011 2007
(full year) (full year)
Current # of Pct. of # of Pct. of
Inventory Sales Total Sales Total
Up to $ 300,000 169 106 69 % 104 44 %
300,001 - $ 400,000 57 20 13 % 59 25 %
$400,001 - $ 500,000 27 12 8 % 26 11 %
$500,001 - $ 600,000 17 7 4 % 19 8 %
$600,001 - $ 750,000 23 6 4 % 8 3 %
$750,001 - $ 900,000 12 1 1 % 8 3 %
$900,001 - $1,500,000 20 1 1 % 10 4 %
Over $1,500,000 11 0 0 % 2 1 %
Total 336* 153 100 % 236 100 %
* 10 have pending sales
Days On Market: For 2011, the average days on market for all homes sold was 286 vs. 243 in 2010, an increase of 18%. Days-on-market is affected by pricing, as well as by lack of buyers. (Note: In Taos, the time to sell a house has always been relatively high. Even when the market was at its peak in 2005, the average time to sell a house was 234 days.)
CONDOMINIUMS
Unit sales for the month were 2 compared to 3 last December. Full-year condo units sold were 31 vs. 33 last year. Dollar sales for the year decreased from $9.9 million to $5.9 million (-41%). Last year, three condos over $1 million sold at Taos Ski Valley; these unusually-high-priced (for Taos) condos skewed the negative dollar variance. The most expensive condo to sell this year sold at $580,000. It was also at Taos Ski Valley (but not in the same association as the million-dollar units).
LAND
December 2012 had 6 closed transactions, the same as December of 2011. The dollar amount increased from $542,000 to $664,300 (23%). For the entire year 2011, there were 41 closed land sales vs. 59 last year, a decline of 31%. Dollar sales for the twelve months were $5.7 million this year vs. $7.3 million last year (-22%).
To illustrate the magnitude of the decline in land sales, in 2005 there were 339 land sales for a total value of $39 million.
Few prospective homeowners or developers are interested in buying land and building. Construction costs have not decreased. Buyers can often purchase an existing home in good condition for far less than what it would cost to buy the land and build.
However, with increasing risks and volatility in financial assets (e.g., sovereign debt defaults, devalued currencies, etc.), you would think that more investors would view land as an attractive way to diversify their portfolios!
COMMERCIAL - There were no commercial sales in December this year; last December there were two, totaling $1,060,000. For the entire year, there were just two commercial sales in 2011 totaling $528,000 vs. nine sales totaling $3.3 million last year. The commercial market is suffering, as the weak economy has severely impacted commercial businesses, and therefore interest in/need for commercial space.
* * * * *
2012 FORECAST
We have been wrong for the past two years: We thought that there would be marginal increases in units sold, but not in price levels. In both of those years, persistent weakness in the U.S. and world economies has kept many would-be buyers on the sidelines. A general mood of pessimism pervaded the market.
Although once again we feel that we are near a bottom in the real estate cycle, we’re now gun-shy about predicting any sort of upturn in 2012. A number of factors may cause buyers to continue to delay purchasing property in Taos: 1) the European sovereign debt problem will come to a head this year, and if the Euro implodes, it will have major negative effects on global economies; 2) in the U.S., the political election campaigning will preoccupy the nation, and many people may wait until after November to decide what investments to make; 3) some unforeseen crisis, such as another natural disaster or war with Iran, may happen.
Recently, there have been some faint signs of improvement in the U.S. economy, and in national real estate trends. But buyers and sellers remain far apart, and the global financial and political systems remain very fragile.
Therefore, at this point we are forecasting another year in the doldrums. We hope we’re wrong again!!
Here are several excerpts from current articles:
Some Good Signs for the Real Estate Market
Daily Real Estate News | Tuesday, December 27, 2011
Sales ticked up for existing homes and new homes, several real estate market indicators revealed last week, pointing to a housing market that may finally be entering recovery mode.
In the most recent report, the Census Bureau reported that the new-home market continued its rebound, with sales of new houses once again inching up last month. New-home sales rose 1.6 percent from October to November to an annualized rate of 315,000, and sales were up nearly 10 percent compared to November 2010.
The median sales price of a new home in November was $214,100, the Census Bureau reported, and the inventory of new houses nationwide decreased to a six-month supply at the current sales pace.
"Inventories of new homes are very low: There's nothing on the shelf, so any increase in new home sales will translate directly into new housing starts," Bob Denk, senior economist at the National
Association of Home Builders, told CNNMoney. "That means putting people back to work."
Other recent good news for the housing market: November sales of existing homes increased 12 percent year-over-year, new-home building starts were up nearly 21 percent year-over-year, and mortgage rates reached new record lows last week, pushing housing affordability even higher.
Source: “New Home Sales Edge Up,” CNNMoney (Dec. 23, 2011)
What's in Store for Housing in 2012?
Daily Real Estate News | Wednesday, December 28, 2011
The worst for the housing market may finally be over, according to housing experts in a recent article in Kiplinger. After median home price have dropped nearly 40 percent nationwide, a rebound is taking shape -- although, housing experts say, the market may stay flat for awhile before gradually ticking up.
According to housing experts in a recent Kiplinger article, here are some predictions for the real estate market in the coming year:
Home prices stabilize: Mark Zandi, chief economist at Moody's Analytics, predicts that home prices nationwide may still drop another 3 to 5 percent in 2012, but the new year will most likely finally bring a leveling off of home prices before gains start to take shape in 2013. When markets do begin to stabilize in the new year, “price appreciation tends to spread unevenly, creating a lot of confusion about where the recovery is occurring and when,” David Stiff, chief economist at Fiserv Case-Shiller, told Kiplinger. Stif, worries about the intensifying European debt crisis, lack of confidence in the U.S. government to effectively deal with the economy, and other concerns continue to keep real estate buying “on hold.”
Buyer vs. Seller on Home Prices
Daily Real Estate News | Friday, December 30, 2011
Housing analysts are expecting home prices to stabilize in 2012, but that doesn’t mean that buyers and sellers won’t continue to be at odds over home prices in the new year.
According to the MBA report, a large gap is occurring between home buying and home selling that isn’t expected to narrow for at least the next five quarters.
From 1992 to 2005, seller sentiment remained high — between 40 percent and 60 percent, according to the report. However, since 2005, seller sentiment has decreased to 7.6 percent. Meanwhile, home buyer sentiment has remained high despite unemployment and economic conditions. Nearly 80 percent of American households say now is a good time to purchase a home.
As home values have dropped over the last few years, many sellers are refusing to budge on their prices to reflect current market traditions. One reason why: Some sellers are underwater on their homes. About 20 percent of home owners nationwide are considered “underwater,” owing more on their mortgage than their home is currently worth. Also, some sellers are realizing there may be a benefit in waiting to sell or to keep the home on the market holding out for a higher price, notes the author of the report, Gary Engelhardt, a Syracuse economics professor.
Source: “Buyers, Sellers Continue to Butt Heads on Home Prices,” HousingWire (Dec. 29,
Sellers Overvalue Their Home’s Worth, Study Finds
Daily Real Estate News | Wednesday, December 07, 2011
About 76 percent of home owners believe their home is worth more than their agent’s recommended listing price -- that’s up from 73 percent last year, according to a new survey conducted by HomeGain of real estate professionals and home owners.
On the other hand, 68 percent of home buyers say homes are overpriced, with 32 percent saying homes are overpriced by more than 10 percent.
“Home buyers and sellers continue to remain apart as to home valuations with the vast majority of home owners thinking their homes are worth more than their agents and the market are telling them,” Louis Cammarosano, general manager of HomeGain said in a statement.
Source: “Three Quarters of Owners Continue to Overvalue,” RISMedia (Dec. 6, 2011)
* * * * *
SELLERS: The market may be close to a bottom, but it will remain a buyer’s market for some time longer. If you want to sell in the current market, you need to price your home realistically. Prices are down 30%-40% from their highs in 2007. Even if the number of sales transactions begins to edge up, prices will not. The properties that are getting showings – and sales – are those that are priced very well. Buyers aren’t even looking at properties that are not priced attractively. In addition to pricing it right, you need to do whatever you can to make your property show well, e.g., take care of maintenance items, de-clutter, paint, clean up the yard, maybe even “stage” the home if it’s vacant. And keep it ready for showings at all times; you never know when a buyer’s broker will want to show it. The old adage about first impressions has never been truer!
BUYERS: Here’s a link to an article on “Why It’s Time To Buy”:
Real estate is “On Sale”!!!
If you have any sort of longer-term time horizon, and if you want to own property here, now is a great buying opportunity! Once it becomes clear that the market has reached a bottom, the deals won’t be as good! If you’re going to finance a purchase, interest rates remain unbelievably low, and they will probably stay low for at least this year. But lenders are much more rigorous in their screening of both borrowers and properties. So cash is still “king” and buyers making cash offers usually get a better price from sellers who are wary of loan contingencies in purchase contracts.
CALL US with any questions, and we’ll be happy to discuss the real estate market – or anything else about Taos – with you!
Sincerely,
The Lora Company
YEAR-T0-DATE MARKET STATISTICS:
Jan. - Dec. 2010 |
Jan. - Dec. 2011 |
Incr (Decr.) |
% Change |
|
Single Family Homes
|
||||
| # Units Sold | 179 |
153 |
(26) |
-14.5% |
| Dollar Sales | $55,686,200 |
$40,371,900 |
($15,314,300) |
-27.5% |
| Median Price | $285,000 |
$225,000 |
($60,000) |
-21.1% |
| Average Price | $311,100 |
$263,900 |
($47,200) |
-15.2% |
| Avg. Days on Market | 243 |
286 |
43 |
17.7% |
Condos + Townhouses
|
||||
| # Units Sold | 33 |
31 |
(2) |
-6.1% |
| Dollar Sales | $9,947,600 |
$5,871,700 |
($4,075,900) |
-41.0% |
| Median Price | $185,000 |
$145,000 |
($40,000) |
-21.6% |
| Average Price | $301,400 |
$189,400 |
($112,000) |
-37.2% |
| Avg. Days on Market | 434 |
387 |
(47) |
-10.8% |
Total S-F Houses + Condos |
||||
| # Units Sold | 212 |
184 |
(28) |
-13.2% |
| Dollar Sales | $65,633,800 |
$46,243,600 |
($19,390,200) |
-29.5% |
| Median Price | $275,000 |
$207,500 |
($67,500) |
-24.5% |
| Average Price | $309,600 |
$251,300 |
($58,300) |
-18.8% |
| Avg. Days on Market | 273 |
303 |
30 |
11.0% |
Land |
||||
| # Units Sold |
|
41 |
(18) |
-30.5% |
| Dollar Sales | $7,288,000 |
$5,655,300 |
($1,632,700) |
-22.4% |
| Median Price | $65,000 |
$95,000 |
$30,000 |
46.2% |
| Average Price | $123,500 |
$137,900 |
$14,400 |
11.7% |
| Avg. Days on Market | 359 |
238 |
(121) |
-33.7% |
Commercial |
||||
| # Units Sold |
|
2 |
(7) |
-77.8% |
| Dollar Sales | $3,285,000 |
$528,000 |
($2,757,000) |
-83.9% |
Multi-Family |
||||
| # Units | 1 |
2 |
1 |
100.0% |
| Total Dollar Volume | $475,000 |
$920,000 |
$445,000 |
93.7% |
TOTAL - ALL CATAGORIES |
||||
| # Units | 281 |
229 |
(52) |
-18.5% |
| Dollar Sales | $76,681,800 |
$53,346,900 |
($23,334,900) |
-30.4% |
(Note: Data exclude Angel Fire, Black Lake, Eagle Nest, Cimarron, Red River, Raton, Chama, Mora, San Miguel, "Other" areas that are not part of the main Taos market Source: Taos Board of Realtors. The data are believed to be accurate, but are not guaranteed Based on data in the MLS system as of 1/10/2012 |
||||
|
||||
Here is a link to a chart displaying Taos market data for the past eight years:
TAOS REAL ESTATE SALES DATA YEAR BY YEAR 2003-2010
Taos
is a great place to purchase property! We can find the right property
for you!! Call
us at 575-758-3275, and let us help you get into this market.
