PREDICTING THE FUTURE
Every month or so I track the Sun Valley real estate statistics comparing the current period to the same period one year previous. But that’s sort of like looking into the rear view mirror, isn’t it? We know where we’ve been, but we don’t necessarily know where we’re going.
Can we predict the future of Sun Valley real estate?
Or this title could be “Sheila Gets Snarky”
As I’m fond of saying, “If I could predict the future I’d be so rich I would be on a brand new fancy Italian bike cycling along the Mediterranean without a care in the world.” Okay, that was snarky, but we all know that the future is hard to predict, even in an information society.
What we can do is look at some indicators to see if we can understand where the Sun Valley real estate market might be headed.
So…. Can we predict the future of Sun Valley real estate?
One Predictor: Days-on-Market
One indicator of a softening market is how long a property has been on the market before it is sold. We call this number “Day-on-Market.”
All the numbers in the charts below represent trends across all price ranges and all neighborhoods in the Sun Valley MLS. These charts track trends in the market beginning in January 2008 and ending in January 2019.
Single-Family Residential Home Trends for Days-on-Market
- If we look at numbers all the way back to 2008, we see that the median days-on-market for a single-family home in the Sun Valley MLS peaked at 139 days in April 2008. This isn’t surprising as we were just entering The Great Recession and there wasn’t a lot of confidence in the market.
- As of January 31, 2019, the median days-on-market dropped to 72, which represents an increase of 9.1% over January 31, 2018, when the number was 66 days.
Condo and Townhouse Trends for Days-on-Market
- The days-on-market for Sun Valley condos and townhouses peaked in March 2009, when it took 201 days for a Sun Valley condo or townhouse to sell.
- As of January 31, 2019, condos and townhouses were selling at a much faster clip, with days-on-market down to 60 days, or a reduction of 26.8% over this same time one year previous.
- Sixty (60) days-on-market is the lowest number we’ve seen since January 2008.
The moral of the story?
Sellers of residential homes in the Sun Valley real estate market can expect to hold on to their house longer than the seller of a condo or townhouse. And even longer if the home is not priced to the market.
But if you are a buyer and you find your “perfect world” condo or townhouse it might be a good idea to make an offer now before someone else does!
Vacant Land Trends for Days-on-Market
- Days-on-market for vacant land in the Sun Valley area peaked in January 2013 when it took 258 days to sell a plot of dirt.
- As of January 31, 2019, it took 202 days to sell a vacant lot.
One More Predictor: Pending or Under Contract Deals
Another crystal ball view of the real estate market is Pending Deals or Under Contract Deals.
Single-Family Residential Home Trends for Pending Deals
- Going back to January 2008, we see that pending/under contract sales of single-family residential homes in Sun Valley peaked recently, June 2018, with 392 homes under contract.
- As of January 2019, there are 378 pending homes in Sun Valley, which is down 6.2% over January 2018, when there were 356 pending deals.
- It’s hard to say yet if these reduced pending sales are actually a trend. It could be that inventory is down, which it is with 9.2% fewer homes for sale than this time last year. Perhaps buyers are sitting on the sidelines waiting for more options in the spring?
Condo and Townhouse Trends for Pending Deals
- As you can see by the graph below, pending deals for condos and townhouses in the Sun Valley market are on a pretty consistent upward trend.
- Pending sales of condos and townhouses hit an all-time high with 326 condos or townhouses under contract as of October 31, 2018.
- As of January 31, 2019, there were 315 pending deals, which is just off .3% over that same month in 2018. Yes, the number is point three percent. Nothing too significant.
Vacant Land Trends for Pending Deals
Vacant land deals under contract are holding steady with 113 pending deals in both January 2019 and January 2018.
Gary Keller always has a thing or two to say about a shift in the market.
Keller Williams is now the largest real estate franchise in the country. Each office is required to submit its sales, volume, and other relevant statistics to Keller Williams International on the first of every month. Thus, Keller Williams is in a unique position to observe a shift in real estate markets for many locations across the United States.
For the past couple of years, Gary Keller, the founder and CEO of Keller Williams, has been saying that we can look for a shift in the market and it seems to be playing out on the west coast.
What we know from the numbers being tracked by Keller Williams is that prices in places like Seattle and Portland are softening and days-on-market are longer. These markets are seeing price reductions, where previously homes were receiving multiple offers and prices were being bid up.
Historically, Sun Valley has lagged behind the west coast real estate markets by about a year.
Check back in one year to see how things shake out.
Sheila Liermann | Sun Valley Real Estate Broker