Final Fourth Quarter 2013 Real Estate Market Report For Santa Fe

There have been many articles written about the state of our Santa Fe real estate market. Rather than comment on these articles, we thought it would be best to publish the data recently released by the Santa Fe Association of Realtors on January 16^th. The quarterly statistics are the best indicators of our unique market. While the real estate market around the nation continued to improve by leaps and bounds, let’s see how Santa Fe fared.

In broader aspects the city’s total closed sale were up marginally from 187 sales in 2012 to 189 sales in the final 4th quarter of 2013. The median sales price for the city was almost even from $279,990 in the final months of 2012 to $280,100 in the 4th quarter of 2013. The county saw a slight dip in closed sales in the 4th quarter from 162 in 2012 to 158 in 2013. The median price in the county, however, slipped in the 4^th quarter from $440,000 in 2012 to $379,000 in 2013.  Overall inventory increased in 2013 from 3408 homes for sale at the end of 2012 to 3882 at the end of 2013.

By neighborhood, the northeast city limits had big gains in median sales price for the final 4^th quarter. From $569,500 to $717,500, this 26% increase reflects more sales of million dollars homes than in the previous year but closed sales dipped year to date by 9%. Northwest city limits had a modest increase in the median sales price for the quarter from $322,400 in 2012 to $327,500 but closed sales increased by over 18%. The southeast city limits had an overall decline in sales from the previous year of 7% and a decline in median sales price from $545,000 to $475,000. The southwest city limits had a 20% increase in closed sales over the previous year and the median sales price here jumped to $229,250 from $195,000 in 2012.

The north county of Santa Fe had a busy 4^th quarter with a 16% increase in sales. Overall, however, sales in this area declined almost 40% from the previous year and it is no wonder that the median sales price also declined by 30% from $635,000 to $443,750. The northwest county was also down overall for the year in closed sales by 7% but the median sales price did increase modestly from $675,000 in the 4^th quarter of 2012 to $695,000 in 2013. The southeast county was also down for the year in closed sales by 8% and the median sales price dropped from $383,250 in 4^th quarter 2012 to $353,750 in 2013. The southwest county saw a huge increase with closed sales almost doubling from the previous year. The median sales price, however, did decline from $320,000 in the 4^th quarter of 2012 to $274,000. Eldorado, which is typically a more consistent market, had a rocky 2013 with a 30% decline of overall sales. Median sales price, however, stayed relatively even at $339,000 from $338,425 the previous year.

So, in a nutshell what does all of this mean? We believe that the positive factors outweigh the declines and that 2014 should continue to be an improving market. We do not believe huge appreciation overall is likely this year nor next year but if we continue to gain 3% every year, the market will recover its equilibrium.

 

Fed Says

Posted on December 22, 2013 by adminkwblog

Last Wednesday, the Federal Reserve announced it would begin gradually paring back on its purchase of non-traditional assets aimed at stimulating growth. Beginning in January the Fed will reduce it’s monthly purchase of Treasuries and mortgage-backed securities by $10 Billion, from $85 to $75 billion. The statement also outlined forward guidance for the Federal Reserve’s primary policy instrument, short term interest rates.

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Federal Reserve Chairman Ben Bernanke delivered remarks Wednesday in Washington, at his final planned news conference before he steps down.

Chairman Bernanke made it clear that the Fed’s easy money policy would continue beyond the previously indicated threshold of 6.5 percent unemployment. He also announced that that rates would not increase until 2015 at the earliest – a consensus among the committee’s voting members.

Our KW Research Department decoded the decision to find out what it could mean for you and your clients.

Because of the Fed’s purchase of mortgage-backed securities it’s likely that mortgage rates will continue to rise, though it may not be a dramatic increase given the modest reduction in the purchase of these assets. Nevertheless, sellers who need to move to a new school district or into a larger home, should consider listing sooner.And buyers who are on the fence would be wise to whittle down their list and make an offer, especially those who want to purchase in areas where prices are spiking.

The decision could also encourage cash-rich onlookers to come out and buy – at least those who can afford it. Several industry experts from the National Association of REALTORS and RealtyTrac were quoted in an article on MarketWatch, stating their belief that despite the motivation, these cash-only deals are unsustainable in the long-term.

Overall, the Feds increased clarity coupled with the expectation of continued monetary accommodation and low, short-term interest rates should keep the economy growing. This was well-illustrated last week when markets responded favorably putting the Dow Jones up nearly 300 points (1.8 percent).