Saco and the real estate market

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A Newsletter by the City of Saco, Maine	March, 2008	Return to newsletter index

I am sure we have all been following the goings on in the national real estate markets. But the adage that all real estate is local is true and what may apply elsewhere in the country may not be the case here. I thought this paper would be a good time to bring every one up to date on what is going in Saco as compared to what you hear in the national news.

Housing Starts
A good place to start would be housing starts. Our current digital records allow us to do a lot of counting so let's go:

HOUSING STARTS, 2003 - 07
New homes		New Condos		Total Starts
2003	76	2003	25	101
2004	92	2003	52	144
2005	64	2005	30	94
2006	79	2005	53	132
2007	43	2007	27	70

You can all do the math but look at 2006 to 2007 you will see a drop in housing starts of 62 units or a drop of 47%. If I were writing a headline for this piece of information, it might say:

Housing starts plunge 47% in the City of Saco!!

Not the best head line we could hope for but that's what going on right now.

Sales Activity
Now let's look at the sales activity in these past five years. This is a popular stat you will see in the press all the time. It is reported to be a good indicator of the overall health of the real estate market. The data below is what I call "good" sales -- actual sales of property and not business exchanges or exchanges amongst family members.

SALES ACTIVITY, 2003 - 07
2003	350 sales
2004	374 sales
2005	404 sales
2006	325 sales
2007	297 sales

Again, if I were writing the headline to sum up these figures, it would appear relatively drastic:

Housing sales activity plunge 8.6% in the City of Saco!!

Now we can see that the sales activity is nowhere near what the "National Average" is for the City of Saco. While the volume is down from the year before and down a lot from 2005. Most stats point to 2005 as the last good year! Most local brokers would tell you they felt the market started to slow in 2006.

Median Sales Price
The median sales price is the big one. It speaks best as to what is going on with prices. Let's see what has been going on in Saco these last five years.

MEDIAN SALE PRICE, 2003 - 07
2003	204,000
2004	225,000
2005	224,900
2006	237,500
2007	235,000

This shows a different picture. That while sales may be down, prices have remained relatively stable in Saco. This compares with a significant drop in prices nationally. My headline would read:

Home prices: Down record 11% on the National level but City of Saco bucks the trend with median prices flat to no change for past two years!

Well that headline is very much better than what the national head lines would indicate!

Well what else can I say? Except for the Assessor's Office-- because we have to do this it's our job. There are just two times you should know what your home is really worth. The day you buy it and the day you sell it. Every other date is just headline data.