September Home Sales Up but Median Prices Down
There’s a feeding frenzy developing at the low end of Flagler’s housing market.
Palm Coast, FL – October 6, 2011 – A feeding frenzy is developing at the low end of the housing market. September real estate sales numbers continue to trickle in, but it’s clear that the September median selling price for Flagler County homes sold via MLS was down and sales were up from August and from September one year ago.
The median home selling price (half sold above and half below) is a better measuring stick than the average price. It’s less affected by the additional of a single high or low value sale. But it’s not perfect. Median price reacts to changes in overall prices but also to changes in the mix of properties being sold. Fewer than 10% of Flagler County homes sold in September for prices higher than the nearly $260 thousand peak in January 2006. September’s $105,000 median sales price is nearly 60% off that peak.
The feeding frenzy focus is on homes being sold by lenders after completing the foreclosure process. Thirty-seven homes in this category were sold (closed) through MLS in September. The median "days on market" was a scant 32 days.
Absorption Rate
There are only forty-four lender-owned homes currently available for sale, representing an Absorption Rate of only 1.2. That means there is barely more than one month’s supply at current prices. Lender-owned sales have spawned bidding wars, driving the selling price above the listing price in 35% of the lender-owned transactions.
The absorption rate is a strong indicator of current market conditions. It’s generally believed that the absorption rate tells us if we are in a Sellers’ Market, a Buyers’ Market, or a Normal Market.
Sellers’ Market – Rates 1-4
Normal Market – Rates 5-6
Buyers’ Market – Rates ≥ 7
The following table compares the absorption rates of several Palm Coast Communities. It also lists the percentage of total sales over the past three months that were comprised of lender-owned homes.
|
Community |
Ab Rate <$100K |
Overall Ab Rate |
% of Sales Lender-owned |
|
Cypress Knolls |
0.8 |
5.7 |
29.4% |
|
Indian Trails |
4.6 |
6.8 |
27.0 |
|
Lehigh Woods |
2.7 |
5.8 |
31.9 |
|
Matanzas Woods |
0.8 |
5.8 |
28.6 |
|
Palm Harbor |
1.8 |
6.0 |
18.8 |
|
Pine Grove |
4.8 |
6.3 |
29.4 |
|
Pine Lakes |
3.3 |
6.5 |
28.3 |
|
Quail Hollow |
6.7 |
6.5 |
25.0 |
|
Seminole Woods |
1.0 |
3.6 |
26.9 |
|
All Flagler Co. |
2.8 |
6.7 |
25.2 |
Source: MLS (based on average monthly sales for the last three months)
Clearly, the market is driven by the low end. It’s being driven by cash as well. 56.8% of September home sales were for cash, up from 52.2% in July and 52.4% in August. Cash sales dominated condominium transactions (62.9%).
I continue to see some very positive signs. The inventory of Flagler homes listed for sale via MLS dipped to 965 over the past weekend. It was over 1.200 just five months ago. The market is no longer crowded with inventory.
The number of building lots sold in September rose to 45 from 24 one year ago. Building lots purchases are a good indicator of plans to begin construction. Residential home building permits were up 25% from one year ago, another good sign.
Condominium Absorption Rates
Absorption rates among Palm Coast’s condominium communities vary widely, again with the lowest rates (highest absorption) concentrated where the best bargains exist. When I say bargains, I’m talking about a balance between value and risk. There are some low-priced properties that buyers perceive as high risk, usually because the association is financially weakened by non-paying unit owners. Other communities are well established with little risk, but prices remain relatively high. Communities with few sales or few units for sale are not shown.
|
Community |
Ab Rate |
|
Canopy Walk |
6.8 |
|
Cinnamon Beach |
7.7 |
|
Hammock Beach |
8.1 |
|
Hammock Dunes |
21.0 |
|
Surf Club |
18.8 |
|
Tidelands |
4.9 |
Source: MLS (based on average monthly sales for the last three months)
For additional information, contact Toby@GoToby.com
local agent
Toby, The same holds true for lots. My buddy Jay Furbay, who is also an agent,and I just bought a Conservatory lot that had sold for 369,000 for 14,000!! A year from now I think most of the bargains will be gone. George Whelan
Belle Terre
What about the Belle Terre section #s?
need direction
i just moved to the west side B section – brushwood – what section name does this area have.
i heard that it use to be a rough neighbor but it sure doesn’t seem that way now – any thoughts
Reply to JP
I will include Belle Terre in my next absorption rate analysis. Thank you.