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Local housing market rebounds

May 5, 2011
By JOHN PEPIN - Journal Staff Writer , The Mining Journal

MARQUETTE - The median sale price of homes in the Marquette area rebounded significantly last year, after a drop in 2009 of 6.8 percent.

"The median sale price represents the middle price - meaning that half of the sales that took place were more expensive and half of the sales that took place were less expensive," said Bruce Closser, of the Closser Associates Inc. appraisal firm of Marquette, in a recent annual market study. "The median is not greatly affected by extremes and is the best indicator of changes in market prices."

Closser's firm has been tracking a range of local real estate market indicators since 1983. The study was created from sales information compiled from the Marquette Area Multiple Listing Service and the Closser firm's own market analysis.

Article Photos

This house on Third Street in Marquette recently sold. The time houses remain on the market in the Marquette area has dropped over the past two years, but still remains above the average for the past 20 years. (Journal photo by Danielle Pemble)

For the purposes of the study, the Marquette area was defined as the city of Marquette, Marquette Township, Chocolay Township and the portion of Sands Township lying north of Marquette County Road 480. The study's data set includes the years 1983 through 2010. The property type studied was single family residential housing, including condominium units.

According to the study, there was a steep drop in the sale of high-end homes in 2008, but the overall housing market did not decline in price when considering the median sale price.

"It actually increased slightly in 2008, which indicated that our market, outside the high-end market, was still performing quite well despite the national recession and dramatic decreases in housing prices in most of the rest of the country," Closser said.

In 2008, the median sale price was $152,400 for the Marquette area.

The following year, the national decrease in sale prices found its way to Marquette County and the median price fell by 6.8 percent to $142,000. There was also a 6.6 percent decline in the average sale price, which indicated the entire market - high end and low end home sales - "took a step backwards in terms of sale price in 2009," Closser wrote.

But in 2010, the median sale price in Marquette area rebounded by $10,000 to reach $152,000.

"The median price stood at $55,950 in 1990 and since then has increased at a compounded annual rate of 5.1 percent," Closser said. "This truly indicates what your long-term return is when you invest in the local residential market."

Other factors of interest in the study included number of annual sales, average number of listings, average days on the market (selling time) and the average sale price.

According to the study, the average number of annual sales for the Marquette area over the past 20 years was 271. Since the study began, there have only been four years that saw fewer sales than in 2009, which totaled 241. But last year, that figure rebounded to 287.

The average number of listings over the past two decades was 168. Since 2006, the number of listings has been above the long-term average, reaching a peak of 246 in 2008, which was almost 50 percent above the long-term average, according to the study.

In 2009, the average number of listings was 220 and last year it rose to 230. Over those last three years, the average has remained above 200 and is higher than at any time since 1988, Closser wrote.

Closser cautioned that the selling time may not be accurate in all cases because the total time on the market may not be known for properties that have been on and off the market several times with different listing offices.

Given that caveat, the average selling time is calculated based on the number of sales and the average number of listings in the same year. The study reported the average number of days on the market over the past 20 years was 115.

In 2008, the average selling time was 186 days, the longest duration since 1988.

"Despite a two-year decline to 146 days in 2010, the average selling time in 2010 is still the third longest since 1988," Closser wrote.

The average sale price was almost $181,000 in 2007, which was followed by declines in 2008 and 2009 totaling about $24,000, according to the study.

"These two years represent the only years over the past 20 years (other than 2001) during which the average sale price of the local residential market declined," Closser wrote. "In 2010, however, the average sale price increased again by 9.4 percent over 2009 to almost $172,000."

The analysis showed that over the past 20 years, starting from $61,245 in 1990, the average sale price has increased at an annual compounded rate of 5.3 percent, despite the significant declines marked in 2008 and 2009.

Closser said the drop in the average sale price, during those two years, was apparently caused in large part by a decline in the number of high-end houses that were sold in those two years.

John Pepin can be reached at 906-228-2500, ext. 206. His email address is jpepin@miningjournal.net.

 
 

 

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