Northern Michigan Real Estate Sales Recap - 3rd Quarter 2005

Sales of Boyne City residential homes and condos surged in the third quarter of 2005 ,compared to the anemic year ago period, while Petoskey residential sales plummeted. This is exactly the opposite of what happened in the third quarter a year ago, when the Petoskey residential market posted record numbers and the Boyne City market was weak. Overall, despite the recent strength in the Boyne City market, residential sales volume in the combined Boyne City, Charlevoix, Petoskey and Harbor Springs markets was down. Importantly, however, while sales measured by both unit and dollar volume were generally down, in some cases significantly, median sales prices actually increased, which is a sign that the sales pullback did not have much of an impact on pricing power in the quarter. Total combined sales volume for all four communities measured by properties sold decreased in the third quarter to 239 units, compared to 274 sales in the year ago period and 273 units in the third quarter of 2003. Sales by dollar volume also fell to $80,524,214 in Q3 2005, from $91,230,277 in Q3 of 2004 and $87,831,696 in Q3 2003. Overall, median sales prices increased in the third quarter of 2005 to $220,000, from $208, 750 in the third quarter of 2004 and $190,000 in the third quarter of 2003. The average price of a home also increased to $336,921, from $332,957 in Q3 of 2004. Another positive sign was the average days on the market of properties sold, which decreased to 179 days from 193 days in Q3 2004.

Petoskey sales, measured by both unit and dollar volume, drove off a cliff in the third quarter of 2005 versus 2004. Petoskey saw 77 residential sales, compared to 109 residential sales in the third quarter of 2004 and 94 residential sales the previous year. This is a drop of almost thirty percent from the year ago period. Total dollar volume also plunged to $22,484,200, from $34,602,931 in the third quarter of 2004 and $28,866,276 in Q3 of 2003. Despite all of this weakness, both median sales price and average days on the market of the homes and condos which did sell were positive. Average days on the market decreased to 173 days in Q3 of 2005, from 222 days in Q3 2004. The median sales price of a Petoskey residential property also continued its upward trend to $220,000, from $218,000 in Q3 2004 and $187,950.

Harbor Springs sales volume also tanked in the third quarter of 2005, with unit volume decreasing from 63 units in the third quarter of 2004 to 46 units in the Q3 of 2005, a drop of over twenty-five percent. Total dollar volume, however, was fairly flat, with $20,174,056 in residential sales dollar volume in Q3 of 2005, compared to $21,650,162 in Q3 of 2004 and $20,386,087 in the third quarter of 2003. Those residences which did sell sold for a lot more money. Median price surged to $302,500, from $230,000 in Q3 of 2004. This compares with a median price of $250,000 in the third quarter of 2003. Average days on the market for those properties whcih did sell continued to decrease, to 172 days from 187 days in Q3 2004 and 234 days in Q3 of 2005.

Interestingly, it was a tale of two counties in the third quarter of 2005, as Charlevoix County sales figures, including Boyne City and Charlevoix, were much stronger than Petoskey and Harbor Springs, which are both located in Emmet County. Charlevoix unit volume actually increased to 70 sale in Q3 of 2005 from 65 residential sales in the second quarter of 2004. This compares to 68 sales in Q3 of 2003. However, total dollar volume continued to slide, from $28,889,083 in 2003 to $26,879,368 in 2004 to $22,545,288 in 2005. At the same time, median sales price continued a nice upward trend, from $151,403 in Q3 2003 to $174,900 in Q3 2004 to $184,450 in Q3 2005. Average days on the market for those units sold did increase dramatically, from 168 days in Q3 2004 to 222 days in Q3 2005.

Boyne City sales for the third quarter of 2005 were a bright spot indeed, as sales surged to 46 units in the third quarter of 2005, compared to 28 sales in the year ago period, and down from an all time high of 48 units in the third quarter of 2003. Dollar volume likewise showed a dramatic increase to $15,320,670 in Q3 2005, almost triple that of the year ago period, in which dollar volume was a puny $5,963,400. This compared with $9,690,250 in Q3 2003. Days on the market for those units sold also declined, in a sign of brisk sales activity, to 130 days in Q3 of 2005 from 161 in Q2 2004 and 164 in Q3 2003. The median sales price exploded to $170,950, from $127,500 in Q3 2004 and $134,500 in Q3 2003. The Boyne City real estate market was definitely the shining star of the four communities surveyed in the most recent quarter.

NOTE: Based on information from the Northern Michigan MLS for the periods from July 1, 2003 through September 30, 2003 and July 1, 2004 through September 30, 2004, and July 1, 2005 through September 30, 2005.

Blogs Used to Sell Homes

Some home sellers are turning to Web logs, or blogs, to make their properties stand out among traditional real-estate listings. Though the Internet has already added a dimension to traditional real-estate listings -- with photos and floor-plan illustrations -- and provides another channel to list homes, blogging lets sellers give tours of their homes in a more personal forum. Click on the link above for the full story.

Consumer Confidence Plunges

According to the University of Michigan's September 2005 survey, consumer confidence plunged in September to its lowest level in more than a dozen years. “High gas prices had a devastating impact on consumers’ budgets and caused consumers to expect a worsening financial situation during the year ahead,” according to Richard Curtin, the Director of the University of Michigan’s Surveys of Consumers. Over the past fifty years, such steep and widespread declines in confidence have typically triggered recessions. Vehicle and home buying attitudes fell to ten-year lows in September. The decline in vehicle buying plans was due to heightened uncertainty about future gas prices, cited by the largest proportion of consumers since the 1979 surge in gas prices, which overwhelmed the appeal of price discounts. The decline in home buying plans was due to an increasingly negative reaction to high home prices, as consumers expressed in September the least favorable assessment in nearly a quarter century.