The Recession is Over! Long Live the Recovery!
Unfortunately this proclamation is a bit tongue in cheek. The Recession has been declared 'over'. The recovery is in its very early stages, but I believe it will be a long slow climb out-hence 'long live the recovery'.
We have seen tempting bits of good economic and real estate news, such as the recent report of both increasing sales volume and increase in median price from 2009 to 2010. This is really great news, and yet does not mean prices are actually climbing. It means that more expensive properties are selling, and that is really positive. Last year in the first Quarter of 2009, 75% of the sales were UNDER $250,000, so it could only go up from there.
The good news has been tempered by the reality of our lagging economy. Higher unemployment claims have been documented and consumer confidence sunk unexpectedly in the most recent report. There are still many areas of the Economy that are not on firm footing, and that will affect the Real Estate recovery nationwide.
What about here on Cape Cod, in my primary market areas from The Bridges to Dennis (focusing most intently on Towns of Barnstable-including villages of Marstons Mills, Cotuit, Barnstable and West Barnstable, Osterville, Centerville & Hyannis), Sandwich and Mashpee? I watch the daily activity carefully, and there are many new listings coming on the market daily. Although properties are selling, they are quickly being replaced with new listings. In some cases, the new listings seem to be coming on with optimistic pricing, based on the surge of activity in the last quarter of 2009. That may help to sell some properties that have been on the market for some time, and have recognized that the Market is not supporting unrealistic asking prices of the new listings. Price reductions are carefully followed on the Internet by active Buyer prospects, and when properties are priced right, we see offers coming, and sales completed.
There is real cause for concern later in 2010, after the Tax Credit expires, and the possible impending flood of more expensive houses coming into foreclosure. For buyers, it might seem wise to wait, but the spectre of increased mortgage interest rates could negate the gain of a lower price point. For sellers, it is wise to price the property correctly now to take advantage of the buyer activity we are seeing.
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