Wednesday, May 16, 2007

The Spring Real Estate Market

Below is an excerpt from our Office Manager at Audrey Edelman RealtyUSA, in an article written about the current status of Ithaca's spring market.

I feel this is really well written and accurate.


This is the time of year when everyone asks, “How’s the market?” The Ithaca market is strong and steady. Based on a comparison of the last 12 months to the previous 12 months, the median sales price has increased by 8.9%. Days on market for the two periods are almost equal, and the number of properties sold is within 1%. Keep in mind, the last two years have been strongest years in terms of number of sales and dollar volume that this area has ever experienced.

Breaking down the statistics further, some changes in the market do become evident. In a market area the size of Ithaca, it is difficult to draw conclusions based on individual monthly totals. These monthly totals typically do not give a true picture when compared to yearly totals. The “spring market” could peak in April one year or in May the next based on variables such as weather conditions and available housing inventory. This year’s market differs from recent years in the growing number of active listings at a given time.

As the number of listings increases, it becomes very important for properties to be positioned in the marketplace with competitive terms. The greatest flurry of showing activity usually occurs in the first few weeks after a property is listed. A property that is overpriced is likely to spend more time on the market, resulting in lost sales opportunities.

While inventory is increasing, there continues to be a steady growth in the median and average sales prices. This is a sign of a continuing strong market. While multiple offers may have diminished this spring from the past few years, they are still occurring, usually on properties in the “affordable” price ranges or on sought-after properties such as lake homes. Historically, low interest rates makes homes in all price ranges more obtainable.

This steady increase in sales prices is causing a shortage of affordable homes in and close to the City of Ithaca. Buyers, municipalities, non-profits, and real estate professionals are all concerned. A strong local economy, accolades given by national magazines, and the natural beauty of our community–all the positives that attract new residents to this area–also help fuel the lack of affordable housing. The demand remains strong. This was witnessed by the 300-plus participants in the recent Housing Fair sponsored by the Ithaca Board of Realtors and The Ithaca Journal. Not only was there interest from first-time buyers, but also seniors seeking programs to help maintain their current homes and a growing number of homeowners wishing to reduce their energy usage.

While affordable housing is becoming harder to find, the growth of new construction in the $350,000 to $650,000 price range continues at a moderate pace. Most of this new construction has been in the areas offering lots with municipal services in newer subdivisions in the Town of Ithaca and the Town of Lansing. As the existing subdivisions are built out, others are in the planning stages. There are condo/townhouse developments on paper that are designed to appeal to the needs of young professionals and empty nesters as well as a growing number of retirees. Ithaca has recently been cited as one of the best places to retire by two national magazines.

Jean McPheeters, Director of the Tompkins County Chamber of Commerce, has stated that the Chamber receives many calls asking for information on “upscale condos with a lake view.” Several developments, with and without the view, are either ready to start construction or being planned. One in particular is offering “loft-style” living.

All in all, we have a vibrant community to call home and a varied housing market with steady appreciation, making real estate a solid investment choice.

This article was submitted by Richard Patterson, General Manager of Audrey Edelman & Associates RealtyUSA. Statistics are based on sales data of the Ithaca Board of Realtors, Inc.

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