At the end of the first quarter, both the number of Rumson homes sold and the number of homes listed for sale have increased from last year. This sends mixed signals to those who’d like to buy or sell a home in Rumson. When the number of sales goes up, that’s usually bad news for home buyers since it indicates higher demand, and higher demand means higher prices. However, when more homes are listed for sale, it gives home buyers more choices, and that usually means lower prices.
Here are the 4 key statistics that I track every month (Sales, Listings, Absorption Rate and Median Sale Price):
|Rumson Home Sales, January 1 – March 31|
|Sales (Demand)||15||20||X% more sales|
|Listings* (Supply)||74||81||10% more listings|
|Months’ Supply* (Absorption Rate)||8.1||9.2||Weaker Demand vs Supply|
|*based on the past 12 months|
|Median Sale Price||$1,187,500||$1,500,000||X% Higher median sales price.|
The median sales price increased by over $300,000 so that’s more bad news for Rumson home buyers. As was the case last month, I won’t report a percentage change from one year to another until at least 20 homes have sold year-to-date in both of the years being compared. That means I didn’t calculate a percentage change for either the number of home sales or the median sale price.
However, for the number of listings I use a rolling average for the last 12 months, so calculating a percentage change there is appropriate. There are 10% more homes listed for sale now than there were a year ago, and an increase in the supply of homes for sale tends to lower sales prices in the near future (good news for home buyers).
The real estate absorption rate is a calculated value- it’s the number of months it would take to sell all the homes on the market if homes sell at the rate they have in the past 12 months. It takes into account a rolling 12-month average of both the number of sales per month and the number of listings, and when the absorption rate increases, sale prices tend to decrease. Basically it’s a measure of supply vs. demand. The real estate absorption rate increased from 8.2 to 8.9 months, indicating weaker demand vs. supply (more good news for home buyers).
At the end of the first quarter, 2 of the 4 key real estate indicators are looking favorable for Rumson real estate buyers, because they’re predicting that sales prices will be going down this year. The other 2 key indicators can’t be used because there just haven’t been enough sales year-to-date to make any reasonable projections (however, by next month we should have enough sales to calculate those two percentages).
As I mentioned last month, I’ve been working with a young couple for several months, helping them to see homes in Rumson and Fair Haven that are within their price range. They found a nice home in Rumson for what I feel is very good value for the money. However, they’ve only reached this point after looking at many houses within their budget.
It would be my pleasure to work with you and spend as much time as it takes until we find the right house for you at the right price. If you’re a first-time home buyer, be sure to read my series of posts on The 5 “P’s” of Buying a Home. Rumson and Fair Haven are wonderful towns to live in- I’ve lived here for over 40 years. My recommendation is to take your time, get to know the local market in the town(s) you’re considering, and make a decision to buy based on your head and not just your heart. You can find a home you love at a price that’s a good investment.
(732) 239-0739 (cell) (732) 530-6686 (office)