2007: Predictable Decline or Prelude to a Crash?
Everyone knows 2006 was a record-breaking year. Coles Crossing was no exception. With the subdivision almost 100% built out, the greatest number of possible sales that could take place did. The number of sales in 2006 topped out at 241, which is approximately 8.7% of the 2761 homes in the subdivision. Many of those were new homes, so that inflates the numbers somewhat. The average sale in Coles Crossing in 2006 sold for $84.32 per square foot, had 3065 square feet and sold for $258,434. It stayed on the market about 69 days and sold for about 97% of its last list price. (One note about days on the market: this is the number of days from the last time it was listed until a contract was accepted. It does not include any previous times it was on the market before the last time).
In 2007, Coles Crossing, like practically every other subdivision in the country, experienced a drop in the number of sales. In 2007, 185 homes sold, which is approximately 6.7% of the total number of homes in the subdivision and about 23% fewer than 2006. That drop is higher than the average percentage drop experienced in other places, but at least some of that may be attributable to the fact that there was little new home activity so fewer overall sales would follow (less advertising bringing in buyers). In 2007, some interesting and encouraging numbers show through. Average price per square foot was up about 3.25% to $87.05 per square foot, with the average 3229 square foot home bringing $281,090. The average time on the market increased 5% to 72 days and it sold for 97% of its last list price.
What can we take from this? Well, as we have found throughout the Houston area, even though there was a decrease in the number of sales from 2006 to 2007, the numbers remain strong. True, it took a little longer for sellers to get their price, but when they did get that price, it was more per square foot in 2007 than in 2006 and they didn’t have to come any more off their list price in 2007 than they did in 2006.
Although it is too early to tell what 2008 is going to bring, so far the number of closings indicate a further softening in the number of sales and a slight decline in price per square foot with the amount of time on the market remaining about the same at 72 days.
We may not know exactly how the numbers are going to stack up for 2008, but one thing we do know, it is very important to pay attention to several things when looking for a home in Coles Crossing or anywhere for that matter. Our next installment will touch on features buyers are looking for in a home today.
