Sach of the four Sedona Real Estate Market sectors appears to be doing its own, disparate, thing, irrespective of what is going on with the others. The Single Family Residence market has flattened out over the six or seven months. The Luxury Home sector is gangbusters, as is the Condo/Townhome market. Vacant Land has taken a dive in numbers of sales, but prices are up a bit.
We’re comparing each of these to 30 April 2018. But, let’s put that in some perspective. Last year was record-breaking across board, despite the slow-down we saw last fall. Even land sales were up sharply, though prices weren’t. This year’s Single-Family Residence sales, for example, were nearly 10% off 2018’s, but were still considerably ahead of the numbers for 2013 through 2017.
More precisely, those home sales were down 9.5% compared with 30 April 2018. That, though, is an improvement over the 1st Quarter when we were down 15%. So, the picture seems to be improving some in terms of volume. The Median Recorded Selling Price was down 2% from $569,000 to $557,000, but the average $/sq. ft. is up 7% to $276. I chalk that discrepancy up to this year’s sharp boom in sales of homes over $1 mil.
Again, not keeping up with 2018 isn’t necessarily bad as long as we maintain a decent stable and sustainable pace. But, it bears watching locally and nationally.
Median recorded sale price down 2%
Increase in sales of homes of $1 milion and up
A pause in sharply rising prices
A related concern is that, in the 1st Quarter of 2019, Southern California had its first MRSP drop since 2012. Only 0.1%, but the market flattening out there does affect us since many of our prospective buyers come from there. Their regional sales numbers were down 14.1% in the 1st Quarter, similar to ours. San Diego was down 8.6%.
Experts there attribute the slowdown to rising interest rates, but more recently those rates have actually come down. Probably a more substantive issue is that of affordability. The higher prices go, the more potential buyers are priced out of the market. Locally, I’m hearing from colleagues that they’re seeing more price resistance. The Median Recorded Sales Price for the Solds, as we’ve seen, has been flat for the better part of a year, but we’re seeing a steady climb in list prices for the Actives. That’s not a productive formula for sellers. Buyers are increasingly value conscious. So, a pause in sharply rising prices is probably healthy in terms of bringing more potential buyers back to the table.
Experts attribute the slowdown to rising interest rates, but more recently those rates have actually come down. Probably a more substantive issue is that of affordability. The higher prices go, the more potential buyers are priced out of the market.
We’re seeing a reflection of that even in the hot Luxury Home Market. Sales of homes over $1 million are up 54% so far this year. And, that’s compared with a record-breaking 2018. 20 sales versus 13. But, the bulk of those sales was in the lower end of that sector. Only two sales above $2,000,000.
The Median Recorded Sales Price shows that half the sales were below $1,1,65,000. That’s a drop of 11% from $1,305,000. And, the average Cost per Square foot was down 9.4% from $350 to $327. The 17 Pending Sales indicate that luxury homes are likely to have a banner year – perhaps even setting a new record. There’s a strong perception of value there.
The relatively tiny Condo/Townhome Sector – less than 20 on the market at any given time – continues to run the table with sales up 14% over a robust 2018. 52 sales already this year. The MRSP sits at $314,250 – up 2.6% with a $263 average price per square foot. Up 10%.
And then, there’s the long suffering Vacant Land Sector. 2018 saw the highest number of sales since 2006. This year it’s down 32% from that. Back, though, to about the average number over the past five years – 43 sales through the first four months. The one bright spot is an increase in the MRSP from $150,000 in 2018 to $167,500 this year. That’s the highest since 2014’s $190,000.