July was another strong month for Fair Haven home sales, with 11 sales closing during the month (10 closed in July 2013). As of July 31st the median price of a single-family home in Fair Haven is up 11% compared to what it was a year ago. An increase in the median price is good news for home sellers and bad news for home buyers. It’s the first of the 4 key indicators we use to monitor the local real estate market.
The 2nd indicator is the number of homes that have sold so far year-to-date. For Fair Haven, there have been 25% more sales this year compared to the same 6 month period in 2013. An increase in the number of sales indicates an increase in demand, and greater demand normally results in higher prices in the near future.
The 3rd indicator is the number of homes that are listed for sale. Here I look at an average of the past 12 months, and I find that we’ve had 7% fewer listings in Fair Haven than we did one year ago. Fewer listings indicates a decrease in supply, and lower supply also results in higher prices in the near future because buyers have fewer choices.
The last indicator is an important one: it’s the real estate absorption rate. This is a calculation of how long it would take to sell ALL of the homes currently listed for sale, assuming that homes continue to sell at the same rate as they have in the past 12 months. The reason that it’s so important is that it takes into account both supply and demand. For this indicator, it’s important to look at both the number itself and the change from one year ago. An absorption rate of 5 – 7 months is considered a “normal market”, more than 7 months is a “buyer’s market” and less than 5 months is a “seller’s market”. One year ago the Rumson absorption rate was 4.3 months, and currently it’s 2.8 months. This tells us that we’re in an even stronger “seller’s market” than we were a year ago.
Here are the 4 objective indicators in tabular form:
|Fair Haven Home Sales, Jan 1 – Jul 31|
|Sales (Demand)||49||61||25% more sales.|
|Listings* (Supply)||30||28||7% fewer listings.|
|Months’ Supply* (Absorption Rate)||4.3||2.8||Stronger Demand vs Supply.|
|*based on the past 12 months|
|Median Sale $||$620,000||$685,000||11% higher median sales price.|
The bottom line is that, unlike in Rumson, where the indicators are warning of a possible price decline, all 4 key real estate indicators are predicting higher prices for Fair Haven homes. If you’re considering buying a home in Fair Haven, I’ve lived here since 1975 and I’ll be glad to find you the right house in your price range. True, you’ll probably have to pay a bit more than you would have a year ago, but I’ll help negotiate as low a buying price as possible. So use Trulia to look for homes you might like, but remember my advice: don’t call the Listing Agent (even if it’s me). The Listing Agent has a fiduciary responsibility to the Seller to negotiate the highest possible selling price. I’d be glad to act as your Buyer’s Agent, and you’ll have my undivided loyalty.
Call, text or email me- I want to be your REALTOR®!
(732) 239-0739 (cell) (732) 530-6686 (office)