At the end of the 3rd quarter, sales of West Long Branch single-family homes were down 12% compared to the same period last year. However, there are 6% fewer homes listed on the market compared to a year ago, the average sales price is up 7%, and the median sales price (the point at which 50% of the homes sold for more money and 50% sold for less) is down 4%.
So what can we say about the short-term future of the West Long Branch real estate market? Will home prices go up or down? We might get some hints from something called the “real estate absorption rate”. The absorption rate is a calculation of the number of months it will take to sell all of the houses that are currently on the market, assuming that home sales continue to sell at the present rate. It takes into account both supply and demand. An absorption rate of greater than 7 months is considered a “buyer’s market”, while a 5 – 7 month rate is considered a “normal market” and a rate less than 5 months is a “seller’s market”.
The latest West Long Branch real estate absorption rate was 12.0 months a year ago and is 12.3 months now, so we’re still well within the definition of a “buyer’s market”, and the small change doesn’t tell us anything about where home prices are heading. However, there are some encouraging signs: the average listing price has gone up by 5%, and homes that have sold are closing at a higher percentage of their listing prices. Here are the numbers:
|West Long Branch Home Sales, January - September (9 Months Year To Date)|
|Sales (Demand)||41||36||12% fewer homes sold.|
|Listings (Supply)||54||51||6% fewer homes on market.|
|Months' Supply (Absorption Rate)||12.0||12.3||Similar demand vs. supply.|
|Note: this is the latest 12 month number|
|Average Sale $ (Value)||$326,312||$348,063||7% higher average sales price.|
|Median Sale $ (Value)||$332,000||$318,000||4% lower median sales price.|
|Average Listing $||$349,737||$368,063||5% higher average listing price.|
|Avg Sale/List $ %||93.3%||94.6%||Higher Sales/Listing $ %.|
Although the weather’s turning colder there still are homes that go on the market in the 4th quarter every year. If you’re looking to buy a house in West Long Branch, take advantage of the Sunday public open houses and see some of what’s currently for sale. If there’s a “Consumer Information Statement” at the open house, take one and make sure you read and understand it. Remember that the REALTOR® at the open house is acting on behalf of the seller.
What if you see a house for sale that looks good to you? Here’s where I disagree with many of my colleagues. My recommendation is that if you’re a home buyer you should NOT call the listing agent (even if it’s me), because she/he has a fiduciary responsibility to get the highest price for the seller. As a buyer, you want to be represented by a REALTOR® who will act as a “buyer’s agent”, and whose fiduciary responsibility is to get the lowest price for you, the buyer. Wouldn’t you agree?
Note: I wrote this article; these are my personal views and do not necessarily reflect the views of Diane Turton, Realtors.
Leonard “Len” Dunikoski, SRES
Diane Turton Realtors – Rumson Office
8 West River Road
Rumson, NJ 07760
(732) 239-0739 (cell) (732) 530-6686 (office)