MICAELA STANALAND | February 6, 2023 | Warwick, NY
National news might be saying one thing about the real estate market, but Warwick's local market is off to quite the start in 2023. This January, the 10990 zip code saw record median sale prices not just for the month, but the highest in over a decade.
Let's take a look at the Warwick market and what it could indicate for the remainder of the year.
All data courtesy of OneKey MLS
This past January, there were a total of 15 single-family homes that came on the market. In real estate, we call these "New Listings".
New listings are important to watch because they give both sellers and buyers an indication of inventory, and whether inventory is increasing or decreasing. When there are less new listings coming on the market, inventory is likely to decrease.
Why does it matter? Decreasing inventory means there are less homes for buyers to chose from. A continuously decreasing inventory will more often result in a "seller's market". A continuously increasing inventory will likely result in a "buyer's market". As a seller, it's important to understand New Listing trends to know when you'll be facing the most competition in your market. As a buyer, it's important to understand New Listing trends to know when you'll likely have more inventory to chose from.
January is a historically low-inventory month in Warwick and the Hudson Valley overall. We have a seasonal market, which more often than not hits new inventory highs in the spring months of May and June. and new inventory lows in the winter months of November and December.
In January 2023, there were only 15 new single-family listings to come on the market in Warwick's 10990 zip code. This is 25% lower than the month's ten-year average of 20 new single-family listings, an indication that we'll still see lower than average inventory this year. However, this January's new listing inventory was slightly higher than last year's (January 2022), when there were only 13 new single-family listings to come to the market.
What does this mean?
As a seller, there's less competition right now if you're thinking about selling your home. This is generally the case anyways for the winter market in Orange County. This could mean you're more likely to get a higher sales price for your home than when inventory is heavy, BUT - don't make the mistake of overpricing your home. While the median sale prices are still on the rise,
As a buyer, there's less new inventory for you to chose from. Inventory likely won't pick up for at least another few months when we head into our Spring market around the end of March. Keep in mind, this is also when more buyers start looking for homes. Make sure you're on an auto-search with the criteria for your ideal home and area and keep an eye out for homes that come on in the winter that those Spring buyers will miss! (And if you're not on one, click the link to sign up!)
Fun facts & figures from 2013 on: January's new listing inventory peaked in 2013 when there were 27 homes that came on the market. June 2020 had the highest number of new listings in the last ten years, when 95 single-family homes came on the market.
Our Inventory Prediction for 2023:
We're still predicting that new listings will begin to rise as the year goes on. If you're wondering by how much...
From 2013 to 2022, we saw a yearly average of 353 new listings come on in Warwick (10990 zip code).
In my opinion, I think we'll see lower than average inventory continue in 2023 but higher than 2022's total of 280 new listings. Where will the new listings come from? Warwick has a sprinkle of new construction projects underway which will be great for inventory and those "move-up" buyers. There's also the continued increase of New Yorkers selling their homes and moving to warmer weather, in addition to those that purchased a home in 2020/2021 and coming to the realization that the house they may have rushed to purchase doesn't really work for them.
For those that didn't buy in that time frame and are sitting on a little more equity, we're seeing a decent amount of sellers feeling like they "missed the boat" on the hottest seller's market our area has ever seen (check out the absorption rates we discuss later). The market it still up for sellers, but I wouldn't expect the multiple offer in 24-hours situation, especially for the higher end market.
More listings will obviously give buyers more options, although a lot of buyers are pumping the breaks until interest rates come down, which they have simce October 2022. If you are a buyer worried about interest rates, keep in mind that if/when rates come down, you can always refinance. Marry the home, date the rate.
BUYERS: Don't forget to check out our affiliate's BUY-DOWN Program which can help you save on interest rates for the first 1-3 years of your mortgage. For more information, reach out to us at email@example.com or call/text (845) 596-9414
So, we just discussed new listings and how the lower the amount of new listings to hit the market, the less inventory buyers have to chose from. Low inventory in any market will cause prices to remain elevated until inventory can meet demand. Although mortgage rates may be up from previous years, people still need a place to live, and they are definitely looking at Warwick.
Warwick's median sale price in January 2023 hit a TEN YEAR HIGH, reaching an astounding $702,500. We repeat, astounding.
Warwick's median sale prices (and number of sales) in January by year:
So, what gives?
The 14 sales that Warwick saw in January ranged from $360,000 to $950,000, had a median of 2,700 square feet of living space on 1.4 acres of land, with a median construction year of 1998. Of these 14 sales, 5 (or 36%) were new construction which do sell at a premium. But even if we were to take those new construction sales out of the equation, the median sale price for the remaining 9 sales was $672,000 - which would still be the highest median sale price 10990 has ever seen in a single month.
Since 2013, the median sale price in Warwick has generally been on the rise. Prices really started to jump from 2019 to 2020, when median sale prices increased by 16% in Warwick. From 2020 to 2021, the median sale price increased again at a rate of 17% slightly higher than the year before.
In 2022, we were still seeing an upward trend in prices, but at a much slower rate compared to the two years prior. In 2022, prices rose at a rate of 6% from the year before.
What does this mean?
From mid-2020 through the first half of 2022, we had the perfect storm for real estate. Low interest rates combined with low inventory and high buyer demand was every seller's dream. Majority of properties were calling for "Highest and Best" offers within days of hitting the market, and more often than not selling for over asking price.
But even before 2020, Warwick's real estate market was on the rise. Since 2017, homeowners in 10990 were getting an average of 96% or more of their original asking price.
When we look at the beginning of the pandemic market in 2020, homeowners were getting a median of 97% of their original asking price, followed by 100% in both 2021 and 2022. In January we saw that trend do nothing but continue, with the median sale price closing at 100.01% of the original asking price.
Of the 14 sales in January 2023, 10 went for over or above their original asking price.
Curious to see how many people are looking for a property like yours? Check out the buyer heat-map for your home here.
Price Prediction for 2023:
If I had to guess an increase or decrease in the median sale price for Warwick, I'd say increase.
In the past 10-years, the median sale prices within a single year have ranged on average $161,000 between the month with the highest median sale price and the month with the lowest.
If we take January 2023's median sale price of $702,500 and say that's the highest median sale price any month will see this year (even though January has never had the highest median sale price in the past ten years), that still puts us at $541,500 for the month with the lowest median sale price. Even at that number, that's still a a 2.8% increase from 2022. That type of increase is healthy for real estate markets, and slows down that ominous "bubble".
Active Listings show us the number of homes that are currently on the market for sale. They can be new listings, listings from the month prior, or even listings still on the market from last year.
The lower the number of Active Listings, the less inventory buyers have to chose from.
Low inventory makes for a competitive market for buyers, and is generally found in a "seller's market". High inventory makes for a competitive market for sellers, and is generally found in a "buyer's market".
Active inventory in Warwick's 10990 market has been on the decline for the past 10-years, with the exception of 2019. On average, active inventory has decreased at a rate of 13.26% since 2013. In January 2023, we saw the fewest number of active listings in a given month, with just 35 single-family homes for sale in OneKey MLS. Prior to that, the lowest amount of homes available was in December 2022 (the month prior), with only 37 homes on the market.
What does this mean?
In the real estate industry, we look at number of active listings as an indicator for two things:
(1) The "competition" our sellers have in a given market
(2) The absorption rate of a given market
An "absorption rate" is a percentage calculated by looking at how fast homes are selling in a specific market within a certain timeframe. The general rule of thumb is anything over 20% is a seller's market and anything below 15% is a buyer's market.
From 2013 to 2016, Warwick's absorption rate ranged from 5.8% to 13.7% which we'd classify as a buyer's market.
If you bought your home during this time, you probably paid under what the seller was asking for. In fact, single-family homes purchased from 2013 to 2016 in Warwick closed for an average of 93.8% of the original asking price. If you're thinking about moving, this current winter market could be the perfect time to list your home for sale (as of today, you'd only be competing with 34 other sellers!).
From 2017 to 2020, we saw a neutral market for buyers and sellers with the absorption rate ranging from 16.3% to 19.4% in Warwick. This is further reflected in the average close to original list price during those years, where homes were closing at 96.7% of their original asking price.
During 2021 and 2022, we saw one of the strongest seller's markets ever, with the absorption rate at 36.7% and 34.8% respectively. Homes on average closed at 99.6% of their original asking price. This is better reflected in 2021 and 2022 when on average homes closed for 100.3% of their original asking price. This means majority of buyers were paying over what sellers were asking for their homes (likely due to multiple offers and bidding wars).
Our Predictions for 2023:
With sales slowing down and less buyers in the market, tied in with our prediction of inventory increasing this year, we're predicting active listings are going to rise in Warwick.
Why? Sellers are going to need time to adjust to a slower market (read: lower sales prices) which in turn will leave buyers reluctant to make offers on homes that are over-priced. Tie this in with a slightly smaller buyer pool because of higher interest rates (read: less people looking at and making offers on homes) and that's going to leave even more homes on the market.
2023 will be all about pricing correctly, and strongly. Make sure you hire an agent that knows your local inventory, and be realistic about the upgrades/improvements your property needs that buyers aren't readily overlooking anymore.
As an agent that represents both buyers and sellers, I can say majority of buyers are not waiving inspections or appraisals anymore. Unless you have a home in pristine condition, you can expect buyers to ask for repairs and/or credits for those larger ticket items.
The wild west real estate market we saw throughout 2020 and 2022 is slowly calming down. We don't see it being the "Real Estate Armageddon" that some media companies are forecasting, but rather a slow-down that will lead to a healthier market over time.
Sellers: Don't anticipate a multiple offer situation in 24-hours like we were seeing these last couple years. Have patience with the market and with the buyers (especially during the slower winter months). If you're getting ready to list your home this year, take the time now to make those repairs that buyers are more likely to call out during the inspection process. Not sure what needs to be done? Get in touch with us for a no-obligation analysis of your home. Pricing correctly and marketing strongly is going to be your key to closing.
Buyers: There aren't as many of you out there these days, but that doesn't mean there aren't any of you. A cooling market will work in your favor. For the best "deals", look at homes that have been on the market a little longer and might need a little more TLC (if you're up for it). Buyers are for the most part looking for homes that are move-in-ready and need little to no upgrading, so if you don't mind putting work into a home, the properties that need it are likely going to be the ones with little to no offers on the table.
Inventory is still low. At the time we wrote this article there were only 636 single-family homes available in the MLS in all of Orange County. There have been 224 single-family home sales in the past thirty days. This puts us at an absorption rate of 35.2% (remember that anything under 15% is a buyer's market, anything above 20% is a seller's market).
I personally believe the winter is a great time to look for a home because there aren't as many buyers out there. Start your search here or get in touch with us to see what steps you should be taking to become a stronger buyer.
We work with buyers and sellers throughout Rockland, Orange, Bergen and Westchester Counties. With our widespread connection to other brokers, we can help anyone relocate out of those particular areas - whether it's Florida, California, or even a different country!
If you have questions about your move or the market in general, we're always happy to talk.
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With the market being as crazy as it is these days, finding a house was no easy feat, that is until we hired Micaela! With houses flying off the market in less than 24 hours, her expertise and knowledge helped us first-time homebuyers clinch an amazing deal on the purchase of our first home. Her willingness to answer any question we had at any time of the day really put us at ease knowing we were in good hands. She made sure we dotted our Is and crossed our Ts when it came down to signing contracts, and to ensure we got everything we were looking for in the sale. We are truly grateful to have had Micaela as our agent, and we HIGHLY recommend hiring her for the sale or purchase of your next home." - Client in Bergen County, NJ
The best real estate agent we've ever worked with, Micaela Stanaland is truly a master marketer who sold our home in two days at top-of-the-market price! Selling our family home upon becoming empty nesters was an exciting but difficult emotional endeavor, but I can honestly say that Micaela handled every aspect of this sale with professionalism and grace--and she is now a forever family friend. From her amazingly cool drone photos to the lively social media video teaser set to music to show the best parts of our home, Micaela set up this sale and sold as soon as we hit the market. She then followed thru, proactively and patiently, right up to the closing! - Client in Orange County, NY
Micaela represented me when I sold my home and I cannot say enough wonderful things about her. From the beginning to the end she was absolutely amazing. She made sure I understood the entire process and ensured I got the best selling price for the home. She was extremely responsive, organized and knowledgeable of the whole selling process. Micaela made sure the process went as smoothly as possible and offered her help in any and every way she could. If you’re looking to buy, rent or sell I HIGHLY recommend using her as your realtor. I cannot thank you enough for getting me through this!!!" - Client in Orange County, NY
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