2015 Swampscott housing market review

This 2015 Swampscott housing market review focuses on the Single Family Home (SFH) market. I shall publish a separate report on the condo market. I have also published a one page Summary of the main numbers.

For the year sales increased 10% to a new record, while the median price increased 5%, but is still some 11% below the 2005 peak. 2005 was, however, an exceptional year (read What happened in Swampscott in 2005?) and the 2015 level was the second highest reported. I suggested in my mid-year review that the shortage of inventory should lead to higher prices in the second half of the year and that did, indeed, occur, with a strong finish to the year in Q4.

Median price

SWPT_SFH_Median_H_2005_15

SWPT_SFH_H_Median_2005_15

SWPT_SFH_Median_Q_2011_15_year

Sales
Sales were a record in 2015, beating the previous peak of 170 in 2004.

SWPT_SFH_Sales_2011-15

Sales at the higher end has been impacted by Swampscott’s high tax rate, so it was encouraging to see a sharp increase in sales above $1 million in 2015:

SWPT_Million

ASR*
Even though Swampscott had a significant increase in its Assessed Values last year, the ratio of AV to Sale Price (see below for an explanation) increased only to 90.5%, meaning that the median sales prices was 10% (100/90.5) above the new Assessed Values.

Source: MLS, Oliver Reports

Source: MLS, Oliver Reports

Comment
Swampscott continues to see new development and conversions, and its proximity to Boston, whether by commuter train or the T from Wonderland, ensures that the market remains attractive to those who accept the trade off with higher taxes.

One way I measure prices is by the ratio (ASR) of Assessed Value (AV) to Sales Price (SP). The ASR is the AV divided by the SP: if the SP is rising (prices going up), the ASR will fall.

Properties selling above their AV will have an ASR below 100%. What this means is that in a period of rising prices the ASR is likely to be falling.  So what we, as homeowners, want is an ASR below 100% and falling.

Remember that AVs are a lagging indicator: the tax bills that have just been sent out for FY2016 are based on actual sales in 2014. Thus the 2015 sales data, reported in this review, will be the basis for FY2017 assessments.

 

 

 

 

 

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