We have all watched the sales prices of homes drop over the last 3 years. The question is: Will that slide continue?
Single family home values in Gilroy dropped by 35.5% from 2007 to 2008. In 2009 they fell another 18.4% . Townhomes values have likewise dropped: 38.5% from 2007 to 2008 and 29.5% from 2008 to 2009.
The average sales price of Gilroy homes in 2007 was $796,676. In 2008 it was $513,913, and $419,228 was the average sales price for 2009.
Townhome sales show a similar pattern: their average sales price was $426,627 in 2007, $262,566 in 2008, and $185,070 in 2009.
However, it appears that the value slide has hit bottom. A closer look at 2009 average values suggests that we may have bottomed out in 9/09 and are beginning to see a rebound in both single family residence and townhome values.
Morgan Hill & Hollister home and townhomes reflect a similar trend in values although the downward adjustments in value are more dramatic as you go south to Hollister.
(Data: MLSListings)
The Morgan Hill housing market is beginning to show some promising signs: The Closed Sales-to-New Listings-Ratio (CS:NL) rose nicely to 89.2% in June from 51.5% in May. June’s ratio nearly doubled 6/08’s of 47.2%. As you would expect Morgan Hill’s Average Sales Price (ASP) also rose in June, up 10.2% from May. However, the ASP of $614,500 is down 31.5% from last year’s average of $898,200 in June.
The best hint of what’s to come is the nice increases in CS:NL. As that indicator continues to increase the ASP is bound to go up.
Next door: Gilroy’s activity seems to be headed in the right direction. While June’s CS:NL ratio dropped slightly from May to June, June’s ratio nearly doubled over last year’s figures. The Average Gilroy Sales Price was lower in June than May by 3.8% and down 32.5% from a year ago. Stay tuned however.
As I update these ‘09 figures I predict an increase in ASP in both Morgan Hill and Gilroy.
For your own study of the actual Multiple Listing Service figures go onto “Client Portfolio” on the navigation bar. There you can see a great deal of real-time data. Enjoy.
