Housing Forecast: Warm and Sunny, With Limited Chance of Affordability
The Northeastern U.S. had a heck of a winter with record setting snowfall and plenty of days with very low temperatures. Back in January and February many in the real estate industry I spoke with were lamenting the brutal weather and expecting a weaker housing market as a result. Admittedly I was incredulous at this widespread belief since the year before we went through a more intense polar vortex and 1Q14 U.S. GDP was revised to the negative due to the significant economic impact it caused. Yet GDP snapped back in the subsequent quarter. Blaming the weather is an always an easy to digest sound bite, usually included within talking points of state of the market releases by real estate trade groups and real estate brokerage firms.
I’m here to state for the record that it is always colder in the winter than the summer and the winter is when we tend to see snowfall. I’ll even go out on a limb and say that some winters are colder than average and some winters are warmer than average. The same goes for snowfall. When a potential homebuyer goes out in January to look at property and are uncomfortable doing so, do they cancel home buying plans for five years? No they wait a few weeks or so for the weather to warm up and resume looking at houses. Sorry for the sarcasm but I grow tired of the weather being the default explanation for weaker housing conditions at the beginning of each year. Get over it.
As for the NYC metro area, the first quarter results were generally better than the same period last year despite a harsh winter. Hmmm.
One of the big NYC metro regional housing stories of this week has been the decline or anemic growth of listing inventory since the beginning of the year. I wrote about falling U.S existing inventory which a few weeks ago. Inventory levels are generally below long terms norms across most of the metro area.
The Wall Street Journal did a nice recap on the state of the regional housing largely using our research and the trend showed generally more sales, less inventory and rising prices. The biggest focus for the regional coverage was the Hamptons market (plus nothing cooler then getting a chart made with your data).
There was tremendous focus on the first quarter Hamptons housing market results – apparently the harsh winter had no apparent impact on a largely second home market. Some of the results that we weathered (sorry).
- Highest first quarter median sales price in a decade
- Highest first quarter average sales price in seven years
- Highest first quarter sales volume in eight years
- Largest sales growth in the $1M to $5M market
No Schussing: Going Up That Slippery Housing Market Slope
This week capped a four week gauntlet of 17 market report releases covering the first quarter of 2015 for Douglas Elliman. I was pretty excited about the research behind our two newest reports for Aspen, Colorado and Greenwich, Connecticut as well as second editions for Los Angeles and Fairfield County, Connecticut.
There’s a lot of information here to digest. Pull out a chair and read it on your balcony or backyard no matter what the weather is.
Jonathan Miller, CRP, CRE
Miller Samuel Inc. Real Estate Appraisers & Consultants
ps Please feel free to share. If you get tired of all the charts, real estate commentary and articles presented in each weekly note, just opt out. I always appreciate feedback so please email me.
- Vornado Sells $1.1 Billion of Central Park South Condos [Bloomberg]
- Listings limit busy real estate-selling season in Palm Beach [Palm Beach Daily News]
- The Real NYC Housing Boom Isn’t in Manhattan [Bloomberg]
- The Film That Launched America’s Debate About the Suburbs [Curbed National]
- New York Area Transport Forum Has Full Agenda [WSJ]
- Downtown Miami condo supply can weather looming bear market [The Real Deal]
- Priced Out of Brooklyn? Try Manhattan. [NYT]
- Global gathering: Foreign lenders bankrolling NYC’s luxury condo boom [The Real Deal]
- Americans’ ideal family size is smaller than it used to be [Pew Research Center]
- Most Millionaires Think They Are Middle Class [CNBC]
- Hamptons Average Sales Price v. Number of Sales [Miller Samuel]
- Boca Raton Number of Sales [Miller Samuel]
- Brooklyn Housing Market Median Sales Price by Property Type [Miller Samuel]
- Prime Global Cities Index Q1 2015 [Knight Frank]
- Buyside – A different way to win listings [1000watt]
- Price out of Brooklyn? Try Manhattan. The Highs and Lows [NYT Graphic]
- 6 Graphs That Prove New York Real Estate’s Love of Mondays [Curbed NY]
- Invest in a Painting, Not a Condo [Bloomberg View]
- Number of Hamptons Sales ≥ $5M [Miller Samuel]
- Manhattan New Development/Re-sale Average Square Footage Trend of Units Sold [Miller Samuel]