The Real Deal / Westport's realty market suddenly on fire
Published 1:08 pm, Saturday, April 13, 2013
Things can become a lot clearer over the course of a couple of months.
In late January, I reported a glimmer of promising news in local real estate markets after four years of steady decline. Westport single-family home values had increased 5 percent in 2012 from 2011 levels. And houses started flying off the market in Weston faster than anything we'd seen since the pre-recession market peak.
Temporary uptick or full-on recovery?
That was the question I posed nearly three months ago, choosing to err on the side of caution. After all, except for the election having come and gone, market fundamentals were about the same. Jobless figures had not improved. The fiscal cliff had not resolved. Interest rates had not changed. The global economy had not strengthened.
But two things suddenly did change in our local markets. They are undeniable and powerful and are having their effects.
The supply vs. demand ratio shifted in favor of sellers. Right now in Westport and Weston, inventory is down while demand has increased. This is a 180-degree turnaround from last year at this time. As a result, price pressure is shifting upward. Market time is way down, multiple offer scenarios are commonplace.
Buyer attitudes changed. National reports of improving real estate values have convinced buyers that they had better act now. As importantly, buyers became tired of waiting.
Right now I would describe the real estate markets in both Westport and Weston as on fire. Sellers are back in charge. Buyers who waited until now, confident they could time the market bottom, are gritting their teeth and paying more than if they had rolled the dice while things were still on the way down.
Meanwhile, those in my profession are scratching their heads. Where did last year's unsold inventory go? Will it come back on the market once word gets out that the market has improved? Why are buyers making deals at prices they refused to pay last year? Will properties with accepted offers higher than any of us can believe actually be appraised at those values?
Will hindsight show that this year's buyers paid too much?
Have we learned nothing from the past five years?
Stay tuned. I'll have an update in another 60 days or so.
Evi Coghlan's "The Real Deal" appears on alternating Fridays. She is a licensed real estate agent with the Riverside Avenue office of Coldwell Banker and a former marketing consultant to Fortune 100 companies. Evi may be reached at 203-247-6691, by emailing her at firstname.lastname@example.org, or visiting www.evicoghlan.com.