Salem 2015 Housing Market review

This 2015 Salem 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 both the SFH and condo markets.

Sales of SFHs were over 200 for the third consecutive year, while the median price was slightly higher at $349,000, equaling the previous peak reached in 2005. In contrast, sales of condos were up 21% and the median price increased by 9%, although both are still below their earlier peaks.

Median price
The median price was consistent in the two halves of the year:

Salem_SFH_Median_H_2005_15

Salem_SFH_H_Median_2005_15_table

As usual, however, there were quarterly fluctuations, with Q1 and Q4 lower than Q2 and Q3:

Salem_SFH_Median_Q_2011_15                                                                              Source: MLS, Oliver Reports

Sales
Although not quite a record, sales were over 200 for the third year in a row:

Salem_SFH_Sales_2005_2015

ASR*
The ratio of AV to Sale Price (see below for an explanation) increased only to 85.5%, meaning that the median sales prices was 17% (100/85.5) above the Assessed Value:

Salem_SFH_ASR

Comment
It seems like an appropriate reflection of the change in Salem that September saw the visit 0f a cruise ship, just before the last of the stacks of the old Power Plant came down. These acts followed the opening of the new train station garage late in 2014, and all help contribute to the development of Salem as an exciting and dynamic town which continues to attract new residents.

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.

 

If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, feel free to contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com.

Read http://wp.me/p2SYWq-1sj

Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated

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