September 2019 ~ Market Update

With the Cromford® Market Index over 200 for the first time since 2005, the market is obviously hot and remarkably unbalanced in favor of sellers. Demand is some 8% above normal, which is strong but not too unusual. What is unusual is that supply is 43% below normal. We have had supply below normal ever since May 2011. but the weak flow of new listings has exacerbated the situation.

Active listings widened the gap compared to last year but declined much less in August than they did in July. Normally active listings grow each year between August 1 and September 1, so even though the decline was gentle it is not good news for buyers.

Listings under contract gained more momentum when compared with 2018 but fell sequentially (as is normal every year). Closed listings beat last year by 6.7%. August 2018 had the maximum 23 working days while August 2019 has one less so this comparison is biased in favor of 2018 making the 6.7% more impressive for 2019 - we are doing about 11% more business through the MLS than this time last year, measured in units. Of course the average price is up over the last 12 months so dollar volume is up by almost 16%.

Demand usually subsides between July and January every year so unless there a brand new trend develops we should see new listings maintain enough momentum to keep active listing counts from falling much further, if at all. However when demand grows again again in February we can expect a mad scramble. We will probably look back on 3Q 2019 and wonder how prices managed to stay so low. Based on existing data, the Cromford® Report expects a strong upward trend in closed pricing between October 2019 and June 2020.

Here are the basics - the ARMLS numbers for September 1, 2019 compared with September 1, 2018 for all areas & types:

• Active Listings (excluding UCB & CCBS): 13,609 versus 16,222 last year - down 16.1% - and down 1.0% from 13,746 last month
• Active Listings (including UCB & CCBS): 17,577 versus 19,831 last year - down 11.4% - and down 1.9% compared with 17,920 last month
• Pending Listings: 6,350 versus 5,262 last year - up 20.7% - but down 2.0% from 6,479 last month
• Under Contract Listings (including Pending, CCBS & UCB): 10,318 versus 8,871 last year - up 16.3% - but down 3.1% from 10,653 last month
• Monthly Sales: 8,810 versus 8,253 last year - up 6.7% - but down 5.8% from 9,348 last month
• Monthly Average Sales Price per Sq. Ft.: $168.99 versus $161.27 last year - up 4.8% - but down 0.42% from $169.66 last month
• Monthly Median Sales Price: $280,000 versus $262,000 last year - up 6.9% - and unchanged from $280,000 last month