Our real estate market is exciting right now. Median home prices are up, more people are going under contract, and cash sales are high. All the market indicators are extremely healthy and stats from 2013 show continuing upward trends since the low point of the Great Recession in 2009.
Rick Klein, a local expert on market statistics has been tracking these positive signals since 2007. If 2014 is anything like last year, we’ll continue to see these trends improve throughout the year.
The only challenge this year is going to be supply, but if you know about these other trends and keep that in mind, you can navigate the landscape effectively.
Younger Buyers are in Town
The tech market is booming right now and younger professionals from places like Silicon Valley, New York, and Texas are buying homes in Park City. Log cabins and lodges are out—contemporary architecture and design are in.
Demand for these homes is high and inventory is low. If you want to sell your rustic home to this crowd, it’s going to need some updating.
Median Home Prices are Up
In 2013, the 12-month median home price in Park City was up 7% over 2012 and 11.4% above 2011.
That price is back above $500,000 and with demand high in the market, it’s sure to continue gaining value at a healthy rate.
Lots of people are buying homes in Park City and the number of homes under contract reflects that. The number of pending sales (under contract) shows 41% growth since 2011 and up 21% over 2012.
More homes are going under contract than in 2007 and only slightly less than the number in 2006.
Closed Sales Are Up
More homes are going under contract, but that doesn’t mean anything if the deals aren’t closing. In this market, we’re seeing more deals close than we have in the last five years. Closed sales are up 17.6% above 2012 and 31.7% above 2011.
Buyers are serious. There are more of them going under contract and they’re closing. This is great news for everyone.
Cash Sales Are Up
Cash sales are adding to the number of closed deals going up. Without the uncertainty of bank financing to prevent the closing of a contract, more deals are going through. 48% of the total sales in 2013 were cash sales.
People are investing more of their own money in real estate than they were before the recession. Cash sales were just 26% of total sales in 2007, compared to 48% percent today.
Distressed Homes Sales are Low
All that cash isn’t being spent on bank-owned properties either. Short sales and foreclosures continue to drop, making up only 3.4% of sales in December 2013, down sharply from 13% in 2012.
They’re also selling at prices only 2% below market value so they’re not doing much damage.
Active Listings are at Historic Lows
Homes aren’t sitting on the market, they’re selling fast. The number of active listings is at a record low, even lower than it was in early 2007. There were only 1113 active listings on January 1st, 2014.
There were just under 1500 active listings in January of 2007. This indicates that homes are selling, but it’s also indicative of a lower inventory of homes for sale.
Because the market has been doing so well, the number of homes available for sale continues to go down. This has been driving buyers to get under contract faster and has made for quick sales.
Developers are working to catch up to the demand with building permits up 150% year-over-year in 2013. Lots are selling and construction is rising. Luckily, there will be more homes on the market to meet the needs of new buyers sooner than later.
Main Challenge in 2014
With an influx of buyers, healthy prices, pending sales and closed sales up, the main challenge this year is low inventory. Buyers, sellers, and realtors are going to have to act fast in this market to get the deals they want.
Anyone considering selling a home should make sure they know the necessary steps to selling your home fast.
If you want to go deeper into the numbers or have a questions, give me (Scott) a call at 435.901.4309 or email me at firstname.lastname@example.org. I’d be happy to answer any questions you have about this year’s exciting market.