Sunday, March 10, 2013

The 2012 real estate market in context

Home sales were up, but prices were down slightly

At about this time last year we declared that Madison Park's real estate market was "beyond stabilized." In the previous year, 2011, prices of sold homes were on the increase and the total number of sales in the neighborhood represented a significant improvement over the immediately prior years. But while home sales continued to increase in 2012, there was not a corresponding uptick in sale prices.

Though the sale of single-family residences was flat in 2012 (78 sales in both years), the condo market heated up last year (36 sales in 2012 versus 23 the previous year). Overall, home sales in Madison Park (Washington Park and Broadmoor included) totaled 113 in 2012, a 12% improvement over the 101 homes sold in 2011.

The median sales price of houses, however, actually declined slightly, from $1,252,000 in 2011 to $1,228,000 in 2012. And the average price per square foot of the houses that sold in 2012 showed a marginal decline to $402.10:

The average price of condos sold in 2012 was $535,301, down from $564,725 in 2011, but the size of the average sold condo was also smaller year over year. Nevertheless, the average price per square foot declined to $410.83 in 2012 from $421.17 in 2011.

As always, there were differences in how the three sections of Madison Park performed in 2012. Interestingly, the least exclusive area of the neighborhood (that would be everything other than Broadmoor and Washington Park) showed a strong increase in both sales activity and the median-value of houses sold:

Broadmoor, meanwhile, experienced a both a decrease in total sales (12 versus 19 the previous year) and a slight decline in the median value of those sales:

And Washington Park was also off in both categories:

This, however, is where we always add a cautionary note. These values are based on the houses that actually sold during the year and may (or may not) be representative of the change in value for other homes in the neighborhood (both those currently on the market and those not for sale).  For a neighborhood this small and diverse, it is much harder to extrapolate values from sales data than is true for other markets such as Capitol Hill, for example. Just ask an appraiser.

Here's some information that many will find more comforting. It comes from Zillow, which provides a monthly analysis of neighborhood home values based on sales data. This is what Madison Park's trend line looks like as of the end of February 2013 (unfortunately, Broadmoor is not included in our neighborhood for Zillow's purposes):

Click to enlarge

The Zillow Home Value Index, shows that between March 2012 and now, the median value of a house here was up 9.4%. If Zillow's methodology is to be believed, this neighborhood is actually doing quite well.

[Thanks to Laura Halliday of Windermere Real Estate--Madison Park for her help in compiling the 2012 sales statistics.]

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