Rumson Real Estate Market Update

This home at 33 Lafayette Street Rumson sold on November 3rd for $1,165,000

This home at 33 Lafayette Street, Rumson sold on November 3rd for $1,165,000

November was a slow month for Rumson real estate. Nine (9) Rumson homes sold in November this year compared to the 14 that sold last year. In addition, our year-to-date statistics still show 3 of the 4 key real estate indicators looking favorable for home buyers (fewer homes were sold, there are more listings, and the real estate absorption rate (months’ supply) is longer. The big negative indicator is that the median home price is up 6%:

 

    Rumson Single-Family Home Sales, January 1 – November 30

                                    2013                2014                Comment

Sales                            114                  98      14% fewer homes sold.

Listings                         73                    76      4% more homes on market.

Months’ Supply         6.1                  7.9      Weaker demand vs. supply.

Median Sale   $1,100,000     $1.170,000      6% higher median price.

Why are the numbers in red font bad for Rumson home buyers?  Fewer sales indicate lower demand, and lower demand tends to push prices down. More listings indicate greater supply, and greater supply also tends to push prices down. The real estate absorption rate (months’ supply) takes into account both supply and demand. It’s a calculation of how long it would take to sell ALL the homes on the market, assuming that homes continue to sell at the same rate they did in the past 12 months.

There are different ways to calculate the absorption rate. I use the average number of sales for the past 12 months and the average number of listings for the same period. An absorption rate of 5 – 7 months is considered to be a “normal market”; a rate less than 5 months is considered a “seller’s market”; and a rate greater than 7 months is considered a “buyer’s market”. So we have a paradox: the absorption rate says we’ve gone from a “normal market” last year to a “buyer’s market” now, and yet the median price is up 6%.

3 of the 4 key indicators are predicting lower Rumson home prices in the near future, so if you’re thinking of buying, 2015 might be a good year for you to make your move. If you’ll need a mortgage to finance your purchase, just keep an eye on mortgage rates. The “experts” are predicting several more months of stable rates, and then a significant rate increase in the 2nd half of 2015.

Len

Rumson real estate agent Len DunikoskiLeonard “Len” Dunikoski, GRI
REALTOR® Associate
Diane Turton Realtors – Rumson Office
8 West River Road
Rumson, NJ 07760

(732) 239-0739  (cell)    (732) 530-6686 (office)

ldunikoski@dianeturton.com

http://www.rumsonfairhavenhome.com

@ListWithLen

 

 

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This entry was posted in Rumson Fair Haven Real Estate, Rumson Fair Haven Real Estate Agent, Rumson Fair Haven Realtor, Rumson Homes Sold, Rumson Real Estate Market. Bookmark the permalink.

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