No Boom No Gloom - Ruidoso Real Estate Trends
April 4th, 2008 categories: Ruidoso Market Trends, Ruidoso real estate
Lately, there has been a lot of interest in the Ruidoso real estate market, from those who have been considering a home purchase for some time.
I’m often asked questions like “Is this a buyers market” and “Are we seeing a bottom” ?
I can’t forecast the future of real estate in Ruidoso especially with the uncertainty of the national markets for both housing and stocks. The historical sales trend and current seasonal slowdown for Ruidoso, along with the market forecasts from the National Association of Realtors, reflect a lull from the overheated markets of 2005 and 2006. A window of buying opportunity may be present now and for several months to come - depending on how you view the data.
Lets look at some historical trends for our area, along with some regional and national factors that influence real estate in Lincoln County.
Comparing the Annual sales numbers from 2004 through 2007, there has been an overall decrease in both residential units sold, and total dollar volume. The annual chart below indicates seasonal declines of 10 percent in units sold, and 14 percent drop in dollar volume, in 2006 vs. 2007 figures. Clearly, we are seeing a slowdown from the “boom” market of 2006, however, Ruidoso has not experienced the severe downturn or the real estate “gloom” often aired on the evening news.
Seasonal slow down: Typically, Ruidoso real estate sales peak during the summer and fall, or May to October. December through April are normally the slowest months of the year, with more summer visitors looking at property. The current slowdown may be due to seasonal factors.
Square footage values are steady: Homes sold in Ruidoso that measure between 1500 and 2000 sq. feet in size, had been climbing each year, from $114 / ft in 2004, up to $149 / ft. for 2007 sales. For the first two months of 2008, that figure had dropped slightly to about $134 / ft., reflecting a softer market, in a slower sales season ( Jan-Feb ) for the village.
Buyers of Ruidoso real estate are often from Texas, where the oil & gas economy has remained strong, despite the national slow down. For many second home owners and visitors, Ruidoso is typically a “drive-to” destination. With gasoline prices approaching record high levels, it remains to be seen whether the Village will see a slowdown this summer.
Interest rates are still low. For the week ending 4-03-08, the 30-year fixed rate averaged 5.88 percent, according to Freddie Mac, and it’s Primary Mortgage Market Survey®. Overnight, rates have trended down again in response to the Federal reserve discounts.
The current inventory of homes for sale is sufficiently high, that buyers feel no rush to make an offer. Recently, I have seen a number of “low-ball” offers made, at 20-30% below asking price. However, most sellers in the Ruidoso market are not inclined to accept those offers, knowing that a spring & summer rebound in home sales might be near.
The national news media continues to report on the “dismal real estate market”, but much of that reporting is focused on the industrial areas of the East, such as Ohio, and the overheated coastal markets such as California and Florida. Though our market has cooled, Ruidoso is somewhat insulated from a meltdown due to limited land, inventory, room to grow, and cost of new construction.
In summary, I would say that buyers may have an opportunity given the seasonal lull, low interest rates, cooler market, and national media hysteria reporting about real estate.
Homes are still selling, however, especially those that are priced right. Staying on the sidelines too long while hoping for further price declines, and you might watch your future home in Ruidoso snapped up by someone else.
To help you stay abreast of the Ruidoso market. I’ll be updating this report often, in addition to adding new market analysis for area neighborhoods.
These weekly updates will be added under the Market Trends category on the Ruidoso-blog. For additional information on the Ruidoso real estate market, or help in buying or selling a property, call or email me.
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