June market update

Posted at 10:26 AM, Jul. 18, 2008

I would first like to begin by saying that this is not a "bad" market. It may be spotty, but properties are selling. They are selling if they are perceived as "good Values" to the consumer. The buyer is there. Money is there. And your home or lot will sell if it is priced properly. Any REALTOR® who happens to be moaning about how bad the market is, either has listing that are not properly priced or is not marketing himself or herself to attract buyers to the good values in the market. That said, here come the numbers:

The residential market in June saw 2 homes go into escrow and one escrow close. This compares with 2007 where 2 homes also went into escrow and 2 homes closed. (Since June is not a "hot" time in our market, these numbers do not mean the market is anything other than normal for the month.) For the six months of 2008, we are showing 16 homes that sold. The total value of those homes that sold was $6,785,904. The median price per square foot was $213 and the average days on market was 229. Interestingly, there were three sales over $700,000 which is the higher end of our market. In the first six months of 2007, 16 homes also sold. The total value was $7,128,000, the median price per square foot was $183.95 and the average days on market was 110. Only one home sold for more than $700,000. So for the first 6 months of 2008, it would seem as if the market is not off very much or not at all for homes, and prices may even be up a bit. So much for doom and gloom in the Sonoita-Elgin-Patagonia home market!

The land/lot market is a little different continuing its "softness" that began 12-18 months ago. June 2008 saw 1 lot go into escrow and 4 escrows close. In JUne of 2007, 1 lot also went into escrow and 5 lots closed. Not much difference. For the first six months of 2008, there were 23 land sales with a median price per acre of $15,500. The total value was $3,543,840 and these lots were on the market for an average of 134 days. In the previous year, 49 lots closed escrow (more than twice as many!) with a total value of $8,751,890. The median price was $19,150 and the average time on market was 82 days.

In summary: The housing market is just fine, but the land market is definitely "off" with sales down and the median price per acre down almost 20%. I do not see the land market improving until our home inventory declines, (there are more than 70 on the market today representing a two year supply), and the cost to build retreats. For sellers, pricing is everything at this time if you want to sell. For buyers, there is much to choose from and now is a good time to buy.