Which segment of our market is more stable? Expensive homes or starter homes?


Which segment of our market is more stable? Expensive homes or starter homes?
By Scott Rogers • June 16, 2009
If you ask most people, you'll be told that starter homes are a much more stable segment of our market right now --- and that the higher end market is definitely doing much more poorly. As it turns out, both markets are performing well, depending on how we examine the issue. Starter homes are performing well! As you can see in the chart above, there is a much healthier supply of homes below $200,000 than in any other price range. Put a few other ways: It would take 10 months for all homes currently on the market under $200,000 to sell, as opposed to the 24 months it would take for homes priced above $400,000. Each month 1 in 10 homes on the market priced under $200,000 is sold --- as compared to 1 in 15, 16 or 24 for the higher price ranges. Yet at the same time, expensive homes are performing well! * 2009 total sales figures are extrapolated from Jan 1 - June 15 data. Of note, the decline in home sales in our market has not affected all price/size ranges in the same way. Since prices change over time (homes shift into different price segments), I examined the change in pace of home sales by dividing our market into starter homes (0 - 1499 SF), mid-range homes (1500 - 2500 SF) and large homes (2500+ SF). You'll note that: The pace of starter home sales has fallen 58% between 2006 and 2009. The pace of mid-range home sales has fallen 58% between 2006 and 2009. The pace of large home sales has only fallen 30% between 2006 and 2009. So, while it almost certainly takes longer for larger homes to sell, it's not because there are fewer buyers seeking that product. In fact, the buyers haven't fallen out of that price/size range nearly as much as they have disappeared from the starter home and mid-range sized home markets. Receive Updates by Email Recent Articles:** There Are Plenty Of Types Of Houses That Exist That Just Are Not Available To Purchase Home Sales By Price Range In The City Of Harrisonburg Are You Compromising On Aspects Of Your Next Home That You Can Or Cannot Change Later? How Much Slower Are The Winter Months In Our Local Housing Market? Rockingham County and New Home Sales Drive Surge in Area Housing Market Find The Balance Between Optimistic And Realistic Home Pricing Room Size Is Difficult To Understand Solely From Real Estate Photos How Much Would You Value Not Having To Prepare Your Home For Showings? One Out Of Four Homes Is Taking Longer Than A Month To Sell Consider The Cost Of Your Planned Renovations When Planning Your Offer
Have any questions? Contact Scott Rogers at 540-578-0102 or scott@funkhousergroup.com
Based on information from the Harrisonburg-Rockingham Association of REALTORS® or its MLS, for the period Jan 1, 2000 through Nov 21, 2024 (unless otherwise noted).
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