Belmont home sales this June suffered from the stall we predicted in this post back in May.
Comparing Belmont July of 2015 sales statistics to July of this year, they might look rather benign, but when you look a little deeper, you can see indications of what could be a slowing trend.
There were only two more listing this year than last, and even with seven more home sales in 2016 the inventory of unsold homes doubled. So did the months of inventory–rising from a minuscule .3 of a month to a mere .7—(still a ridiculously low number considering the U.S. housing inventory level hovers around six months). [CLICK THE IMAGE TO ENLARGE]
While the $129,000 median drop in home prices might seem shocking at first glance, it’s mitigated to some degree since smaller homes sold this year. In fact, if we factor in the difference in the size of the homes in the two periods we come up with an almost identical median price year-over-year of $1,633,000.
We also see the price per square foot dropping from $906 to $824—and larger homes sold last year. Why is that important? Because larger homes statistically sell for less per square foot, since the land upon which they sit is not in the equation, yet can account for 50% or more of a home’s value.
And there’s the smoking gun—home prices did not go up in Belmont this June as compared to last. Not only that, but sellers received only 106% of their asking price compared to 119% in June of 2015. [CLICK THE IMAGE TO ENLARGE]
Is it the unknown of Brexit? That served only to help lower mortgage payments—in theory giving buyers more buying power. It is an election year? This one is tumultuous. Whenever there’s an unknown in the air buyers tend to pull back, sit on the fence and wait it out—it’s human nature.
It could also simply be that we’ve hit a price threshold that the average buyer can no longer afford, or any combination of the above (or more). In any case, it was bound to happen at some point. The question is, have we hit that point?
Drew & Christine Morgan are REALTORS/NOTARY PUBLIC in Belmont, CA. with more than 20 years experience in helping sellers and buyers in their community. They may be reached at (650) 508.1441.
The information contained in this article is educational and intended for informational purposes only. It does not constitute real estate, tax or legal advice, nor does it substitute for advice specific to your situation. Always consult an appropriate professional familiar with your scenario.
Drew & Christine Morgan did not necessarily participate in these sales