Swampscott Mid-Year 2018 Housing Market Report
(Click here to download a PDF of this report.)
The recent strong growth in the median price of the Single Family Homes (SFH) sold in Swampscott continued in the first half, with the median price increasing by 7% from a year ago to $577,750.
While quarterly prices can and do fluctuate, the median price has now exceeded $500,000 for seven consecutive quarters.
SFH Sales
After a sharp drop in 2017, sales recovered in 2018 to the levels of 2014-2016.
Sales by Price
The increase in the median price can also be demonstrated by the fact that the percentage of houses that sold for less than $500,000 dropped from 51% in 2016 to 32% in 2017 and to just 27% in 2018.
Of the 73 sales, 11 took place at list price and 28 above list price.
SFH for sale
As of July 1, there were just 7 houses for sale in Swampscott under $600,000. At the other end of the scale there were 9 for sale over $1.5 million, while there were only 2 sales at that level in the first half of the year. Notably, one of those sales occurred at $7.7. million, one of only 10 sales over $7.5 million in Essex County in MLS records, and almost double the previous highest price recorded in Swampscott.
Condos
As we saw in Beverly with Elliot Landing, a large new development can have a major impact on the reported median price since new developments are usually of higher-priced units. The 42 units at Avery will have a similar impact on the median price in Swampscott. In the first half of 2018 there were 9 sales recorded at Avery at prices from$370,00 to $500,000. Without the Avery sales, the median price for the first half would have been $299,900.
Sales by Price
Without the Avery sales the percentage of sale under $250,000 would have been 20%, down from 43% in 2016.
Condo for Sale
The MLS numbers for July 1 include only 2 units at Avery, although there are 21 currently available.
Summary
It took 12 years for the median SFH price to beat the $517,300 achieved in 2005, but that figure has now been put firmly in the rear view mirror. With only 13 of 30 pending SFH sales at list prices under $600,000, and just 7 of the 30 SFHs for sale listed under $600,000, there is every chance that the median price will top $600,000 in the second half of 2018. Meanwhile, Avery continues to transform the condo market in Swampscott.
Sagan Harborside Sotheby’s International Realty
Swampscott Oceanfront sale eclipses previous record
The sale of 25 Rockyledge Road in Swampscott closed this week at $7.7. million, nearly double the price of the previous highest MLS sale in Swampscott – the house next door – which sold in 2013 for $3.95 million.
25 Rockyledge is a one of a kind house – at a one of a kind price.
But agents are reporting that there has been a lot of activity at the higher end recently, a good sign as we head into spring.
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, please contact Andrew Oliver on 617.834.8205 or Kathleen Murphy on 603.498.6817.
If you are looking to buy, we will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Andrew Oliver and Kathleen Murphy are Realtors with Sagan Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Pending $8 million sale in Swampscott
A 14,000 sf contemporary house, sitting on an acre of ocean top land, and listed for sale at $7.995 million, has just gone under agreement in Swampscott.
Assuming the sale goes through at some proximity to the list price, this sale will eclipse the previous record MLS sale in Swampscott of $3.95 million – for the house next door.
And the new owner is clearly not put off by the change in the deductibility of property taxes: they will come in this year at $114,411.
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, please contact Andrew Oliver on 617.834.8205 or Kathleen Murphy on 603.498.6817.
If you are looking to buy, we will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Andrew Oliver and Kathleen Murphy are Realtors with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Swampscott market surges to new high in 2017
(Click here to download a pdf of this report.)
The median price of the Single Family Homes (SFH) sold in Swampscott in 2017 jumped $42,000, or 8.6%, to a new high of $530,000, finally surpassing the prior 2005 peak of $517,300. Sales, however, reflecting the low inventory all year, dropped to 135 from 157 in 2016 and 183 in 2015.
Median price
The first chart shows median prices since 2000. I find it helpful to look at longer term trends and this chart shows how prices – which had already risen for some years prior to 2000 – jumped sharply in the early years of the millennium, with a spike in 2005, and dropped during the Great Recession. Prices have been moving upwards for the last three years.
Source:Oliver Reports
The future of the Marian Court site? $2 million condos
According to this Swampscott Reporter article White Court, the former summer home of President Calvin Coolidge and more recently the site of Marian Court College, has been sold to four Swampscott developers who plan to build 18 condos on the 6.2 acre site.
Wicked Local: Greg Phipps
The project is zoned as an independent living facility, which means that it’s restricted to people age 55 years and older with no children.
How is Swampscott’s 2018 Property Tax Rate calculated?
In my Swampscott’s tax rate goes down – and so do tax bills!! post this week I promised to write another article explaining exactly how the tax rate was calculated. This is it.
The formula is actually very simple: take the $ amount of the previous year’s tax levy, add 2.5% for Proposition 2 1/2, and also add any new growth (such as new construction or a condo conversion). This figure is the new maximum tax levy. To this figure is added debt service – the Principal and Interest payable on the town’s debt. Note that in recent years, Swampscott has not assessed the maximum allowed under this formula, a decision that has reduced the tax bill for residents. And in fact the average tax bill will decline in FY 2018 for the first time since FY 1994!
Here are the numbers for FY 2016, 2017 and 2018, remembering that the FY runs from July to June.
The Tax Levy calculation
The maximum $ amount that can be raised by the property tax will increase year by year. That is because of the formula: last year’s number plus 2.5% plus new growth. In the table above you can see how the FY 2017 maximum tax levy of $46,604,909 becomes the base for FY 2018. Add 2.5% and new growth and the new figure is $48,386,446. To both these numbers is added the debt service – Principal and Interest on the town’s debt, much as homeowners pay P&I on their mortgage. Note that the actual tax levy was less than the maximum allowed by just over $1 million in FY 2017 and by just over $2 million in FY 2018. In other words, the amount of taxes raised was reduced by these amounts each year. Note also that the debt service figure for FY 2018 has dropped by over $0.8 million.
The Tax Rate
The actual tax rate depends upon the total Assessed Value of all property: residential, and commercial, industrial and personal (CIP). The tax rate is calculated by dividing the total dollar amount to be raised from each class by the Assessed Value of each class. Thus, the headline tax rate will also fluctuate depending upon the direction of Assessed Values.
In simplistic terms, if we assume that the $ amount to be raised increases by a little more than 2 1/2% each year, then if the average Assessed Value also increases by a little more than 2 1/2% the tax rate will be unchanged. If the increase in Assessed Values is less than 2 1/2%, then the tax rate will rise. And if the increase in Assessed Values is more than 2 1/2% then the tax rate will fall.
Looking at the Swampscott residential tax rate, in FY 2017 it was $17.45, achieved by dividing $42.7 million by the residential AV of $2,447 million. In FY 2018 the amount to be raised from residential taxpayers is due to drop slightly to $42.4 million, but because the total residential AV increased by 8.3%, the headline tax rate dropped sharply to just $16.00, the lowest figure since 2009.
How does debt service affect the tax rate?
The announced property tax rate announced each year includes the cost of debt service. One of the factors cited for the decline in the tax rate for FY 2018 is the reduction in the cost of debt service, something which the Town warns may be temporary. The impact on the tax rate can be seen in the table below:
Comment
The residential real estate market in Swampscott has been very strong in 2017 (and the 2017 median price will be the basis for the FY 2019 tax rate). At this stage it looks as though the median price will be around $525,000 (a new high), an increase of over 7% from 2016’s $488,000. But bear in mind this is the median price of the SFHs that will actually sell this year, so does not imply that the Town’s residential Assessed Value will increase by 7%.
As to the tax rate for FY 2019, that depends on a number of factors: the amount of debt service, how much of the maximum tax levy is assessed, and the shift to the CIP class being three of them. But he continuing increase in the average Assessed Value will moderate any increases in other areas.
From a real estate perspective, the substantial decline in the tax rate and the reduced shift to the commercial sector are both very welcome news and should encourage more people to decide both to work and live in Swampscott.
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, please contact Andrew Oliver on 617.834.8205 or Kathleen Murphy on 603.498.6817.
If you are looking to buy, we will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Andrew Oliver and Kathleen Murphy are Realtors with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Swampscott’s tax rate goes down – and so do tax bills!!
Swampscott’s residential tax rate for 2018 has been set at $16.00, down from $17.45 and the average single family tax bill will actually decline by $153, with some 74% of the town’s residential parcels seeing a reduction in the total tax bill.
There are three reasons for the tax relief: new growth, including Hanover Vinnin Square; the use of free cash to reduce the levy; and a reduction in debt service, which may be temporary with a number of new projects “coming down the pike.” Additionally, the average single family assessment increased by 7%, something that reduces the tax rate.
The commercial tax rate will also drop, from $32.30 to $28.83, as the Board of Selectmen voted to reduce the loading from 175% to 170%.
I will issue a fuller report will be published this weekend. Meanwhile, here is a link to an article in the Lynn Item: Swampscott homeowners get tax break.
Swampscott’s Disappearing Housing Inventory
Many of the headlines about real estate over the last year or so have referred to the decline in inventory. One result of the decline has been bidding wars. Another consequence is that some prospective buyers have become discouraged and stopped looking actively, while some sellers have not listed their house because they fear they will not be able to buy another house.
The chart below shows the month-by-month inventory of SFHs for sale in Swampscott over the last 4 years. Inventory in early 2015 was impacted by the brutal winter (remember the polar vortex?), but it picked up only slightly thereafter. And as we saw in my post Marblehead’s Collapsing Inventory published earlier in the week, there has been no significant pick up in inventory in either of the traditional selling seasons: spring and fall.
Source: MLS, Oliver Reports
Here’s another way to look at the inventory: this chart shows the monthly average number of SFHs for sale each year:
Source: MLS, Oliver Reports
With this startling decline in inventory it is no surprise that the median price of SFHs sold in Swampscott has been rising, as high-lighted in Swampscott Q3 Housing Report: prices break through $500,000 – at last .
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, please contact Andrew Oliver on 617.834.8205 or Kathleen Murphy on 603.498.6817.
If you are looking to buy, we will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Andrew Oliver and Kathleen Murphy are Realtors with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Swampscott Q3 Housing Report: prices break through $500,000 – at last
The startling decline in inventory at lower price levels over the last two years has contributed to a 9% increase in the median price of SFHs sold in the first 9 months of 2017 to a record level of $530,000. It is likely that 2017 will see the old 2005 record median price of $517,300 broken – finally.
Median Price
6 of the last 8 quarters have seen median prices above $500,000.
Swampscott Mid-Year Review: Prices hit new high
Reflecting the low level of inventory, sales of Single family Homes (SFHs) dropped sharply in the first half of 2017, but the median price increased by 10% to a new high for the first half of the year of $539,900 and is on track – finally – to surpass the 2005 peak of $517,300 for the full year.
For most of the year the number of condos for sale has been 5 or fewer and the number has only “jumped” to 9 because of the new Avery development. The median price in the first half increased 16% to a new high of $295,750, but in a small market with wide variation in prices the median price can reflect the type of condo sold in a particular time period. Nevertheless, 15 of the 37 Condo sales in the first half of the year took place above the list price, an indication of strong demand.
Single Family Homes (SFH)
Here is the chart of half-yearly median prices since 2012, followed by a table showing quarterly numbers.
In a seasonal (think winter) market with a limited number of sales, quarterly fluctuations can and frequently do occur (which is why I place greater emphasis on semi-annual and annual numbers)
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Sales
The shortage of inventory has caught up with sales.
SFH Sales by price
This table shows that the percentage of houses selling below $500,000 has declined in the last three years from 59% to 51% and now just 32%. Since the median price is that at which 50% of sales are higher and 50% lower, as the percentage dropped from above 50% to below it, so the median price has moved from under $500,000 to above it.
Current SFH Inventory
There are currently 5 SFHs for sale under $500,000 and a total of just 18 under $1 million. The biggest change compared with last year is the drop from 20 to 10 in the number for sale between $600,000 and $1 million.
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Condo Market
The condo market in Swampscott is small and varies from modestly priced developments around Vinnin Square to luxury oceanfront units. Those two factors can – and frequently – do cause swings in the recorded median price. The larger the sample the more reliable the number (the law of large numbers) so I place some confidence in the half-yearly number and most in the full year’s figure. Note also the breakdown in sales by price shown after the pricing information.
MLS, Oliver Reports
Condo Sales by price
This table shows that the percentage of condos selling below $250,000 has declined in the last three years from 59% to 43% and now just 25%. Since the median price is that at which 50% of sales are higher and 50% lower, as the percentage dropped from above 50% to below it, so the median price has moved from under $250,000 to above it.
15 of the 37 Condo sales in the first half of the year took place above the list price, an indication of strong demand.
Current Condo Inventory
5 of the 9 condos currently for sale have just come on to the market at the new Avery development, which will add 42 units to the market.
COMMENT
It is no surprise that the combination of very low inventory, strong demand and low mortgage rates has finally pushed the median price of SFHs selling in Swampscott to a new high, with 20 of the 54 SFH sales taking place above list price. While the factors cited last, there is no reason to expect a change in the upward movement of prices.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Please contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com for a free market analysis and explanation of the outstanding marketing program I offer
If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Is there really an inventory shortage?
You have all read – and I have written enough – about the chronic shortage of inventory to assume that the answer to this question is a resounding yes. But it all depends on price.
A market is considered to be in equilibrium between buyers and sellers when the number of homes for sale equals about 6 months of sales. I have put together charts for Marblehead, Swampscott and Essex County overall, showing, by price, the number of sales so far this year plus the number scheduled to close by June 30 and compared that with the number of homes currently for sale. If the market were in equilibrium – the two bars for each price would be the same size.
Let’s see what we have. First, let’s look at the overall market for Marblehead and Swampscott: clearly supply is below the level of a market in equilibrium, so it is a sellers’ market.
Source: MLS, Oliver Reports
Now let’s look in more detail. First, Marblehead:
Source: MLS, Oliver Reports
At all price points up to $1 million, supply is way below sales levels for the first half of the year. But as soon as we go over $1 million the position is reversed. And the total number of homes for sale under $1 million is just 23.
Next, Swampscott:
A similar story here, except that the supply equation reverses at $700,000 – with one exception. Note that from $1-1.5 million there are fewer homes for sale than have sold so far in 2017.
Finally, let’s look at the 34 cities and towns of Essex County overall:
Source: MLS, Oliver Reports
And in more detail:
Source: MLS, Oliver Reports
Sellers are in control up to $700,000; the market is in balance between $700,000 and $1 million; and it is a buyers’ market over $1 million.
Comment
One of the surprises of the market this year has been how weak demand has been for higher-priced homes. Logically, with the market so active under $1 million, and macro-economic factors – the stock market at record levels, expectations/hopes of tax cuts coming – positive, one would expect to see sellers trading up. And that is especially true in a town Marblehead, a town people are reluctant to leave – meaning most sellers plan to buy another house in town.
The optimistic view is that this may be a timing issue and that sales of higher priced houses will soon pick up. But clearly this is an excellent time to trade up to a higher priced home – and you don’t have to compete with 90 groups at Marblehead Open House.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Please contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com for a free market analysis and explanation of the outstanding marketing program I offer
If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
90 Groups at Marblehead Open House
After my post last week 60 groups at Swampscott Open House for house in the $500s, this past weekend there were 90 groups at a Marblehead Open House for a house in the $600s.
If we assume 50% of the attendees at each Open House were genuine buyers, that means there are 29 buyers still looking for a house in Swampscott in the $500s and 44 in Marblehead in the $600s.
Read Sellers: now is the time to act.
Then read Which broker should I choose to sell my house?
Please contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com for a free market analysis and explanation of the outstanding marketing program I offer
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
60 groups at Swampscott Open House
Is there strong demand for houses under $600,000? Well last weekend 60 groups visited an Open House for a property in that price range and the house went under agreement on Monday. It would be a reasonable bet that it will sell for over the list price.
Is there strong demand? I think the answer is obvious.
Read my Swampscott market report just published for an up-to-date report on the current market.
If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Please contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com for a free market analysis and explanation of the outstanding marketing program I offer
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Swampscott Q1 2017 Housing Market Report: inventory shortage
Sales of Single Family Homes (SFH) dropped in Q1 while prices rose sharply. Caution is needed because of the low volume of sales, but the chart below the table, showing sales YTD, pending sales and current inventory, clearly suggests that the median price is going to remain above $500,000 and threaten, at last, to break the 2005 peak of $517,300.
Source: MLS, Oliver Reports
Median price
YTD the median price of sales is $524,000; the median list price of pending sales and homes available for sale are both well in excess of $550,000.
Source: MLS, Oliver Reports
Condos
In markets such as Swampscott with a small number of condo sales I do not report in depth on Q1 numbers, which saw sales increase from 9 to 14 while the median price declined from $268,050 to $245,000.
More significant is the inventory situation: there are just 2 condos for sale in Swampscott.
Source: MLS, Oliver Reports
Comment
While it is important to understand that the median price reflects what is actually selling or available for sale, rather than the entire market, it is a reliable guide to activity as sellers (and real estate agents) price new listings based on comparable sales.
What is very clear is that there is an extreme shortage of both SFHs and condos for sale in Swampscott. And we all know what that means for prices.
Are you thinking about selling? Read Which broker should I choose to sell my house?
Please contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com for a free market analysis and explanation of the outstanding marketing program I offer
If you are looking to buy, I will contact you immediately when a house that meets your needs is available. In this market you need to have somebody looking after your interests.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
@OliverReports
Swampscott 2016 Housing Market by the Numbers
In 2016 the median price of a Single Family Home (SFH) in Swampscott rose 6% to $488,000, still well below the exceptional $517,300 of 2005. Sales dropped 14% as supply was sharply lower throughout the year.
The median price of a condo rose 4% to $255,000, 11% below the 2005 peak. Sales fell back from the levels of the prior two years. (more…)
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