Swampscott Mid-Year Housing Market Review
Inventory in the Single Family Home (SFH) in Swampscott remained well down on last year, while sales were slightly up. The outlook is for an increase, possibly a sharp one, in the median price in the second half of the year.
The median price for the first half of 2015 was $445,000, up 1% from $439,000 in 2014.
The peak H1 median price for Swampscott was $515,000 in 2005, so prices in Q1 2015 were still 14% below that level, whereas in Essex County overall prices are within 1% of their 2005 peak.
The next table shows quarterly prices and changes since 2011. Only once in the last 15 years has the first quarter seen the highest price for the year.
Looking at the 13 sales since June 30 and the 27 pending sales (properties with an accepted offer which have not closed) as of July 17, I note that the median list price was $512,000. In the first half of 2015 sales took place on average at a 2% discount to list price, suggesting a median sales price for the pending sales of around $500,000. These numbers suggest that the Q3 median price for Swampscott will come in strongly.
Rather surprisingly, given that inventory of houses for sale in 2015 has been well down from 2014, sales were actually up slightly in the first half and were, by a small margin, the highest this century.
The next two tables show the month by month inventory compared with 2014 and the breakdown of current inventory by price. Note that supply has not followed the usual pattern of picking up this summer. Of the 47 SFHs for sale today just 7 are listed below $445,000, the median sales price for the first half of 2015. And only 11 are below $500,000.
Assessed Value compared with Sales Price
The ratio (ASR) of Assessed Value (AV) to Sales Price (SP) can give a good indication of what is happening to underlying prices.If properties selling above their AV the ASR will be below 100%.
Remember that AVs are a lagging indicator: the tax bills for FY2015 are based on actual sales in 2013. Thus the 2015 sales data, reported in this review, will be the basis for FY2017 assessments.
Let’s look at the ASR for Swampscott SFHs in recent quarters.
There are two reasons that the ASR increased in the first half to 90.4% from 84.2% in 2014. First, median prices in 2013 (the year on which current assessments are based) rose 11%, leading to a jump in assessed values in 2015 (when assessed values go up, the ASR will also go up).
The second reason was explained by Town Accountant Dave Castellarin, who said: “This was a re-evaluation year; with a lot of residential value going up, rates go down.”
In Swampscott this year Assessed Values went up, but the tax rate fell from $18.70 to $17.15, although this is still the second highest rate in Essex County.
Overall, however, the ASR of 90.4% means that the median house sold for about 11% more than Assessed Value.
The winter weather impacted the market in two ways: keeping buyers indoors, and creating the need for repairs which caused a delay in listing for some houses. With the sharply reduced inventory, which still prevails, it was remarkable that sales were as strong as they were in the first half.
Sales often slow down post July 4, which is the date many buyers set for being in their new home in time for the next school year. Nevertheless, demand remains strong and well-priced, well-presented houses continue to sell briskly.
Looking at pending sales and current inventory, it seems almost certain that the median price in the second half of the year will increase, possibly quite sharply, from the first half figure of $445,000.
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.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
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