The holidays are well past us (finally) and I've had time to sit down and look at the last year. The numbers I pulled told an interesting story, one we are all very familiar with: 2007 was a difficult year for everyone. I'm not sure that "difficult" was either good or bad, but looking at these facts, we know that the real estate market has fundamentally changed.

Some select facts:

1. The number of Total transactions in Wilmette was actually down year-to-year. In 2007 there were 286 single family house transactions versus 335 in 2006, a 15% decline. By the way, there was a decline in transactions 2005 to 2006 as well. The 15% decline last year simply continues the slowdown we saw in 2006.
2. The ONLY price point that had more transactions than the prior year was the segment $1, 500,000 to $1,749,999 (23 in 2007 versus 19 in 2006.) This price point was very active and featured mostly New Construction homes. The total volume in this segment reached $37,359,600, a 22% increase in transaction value. I think the story here was that the cost of New Construction was still on an upward price trend in 2007. It took longer to sell these homes, the builders had to make more concessions than in 2006, there were more price reductions (30% of the homes reduced price before getting a contract) and there were fewer buyers. (Prediction: New Construction homes will have a difficult time again in 2008.)
3. On the other hand, the Average Price of all sold properties in Wilmette was up 0.5% to $946,326 (okay, that's really just "flat" but it's not a decline.) In the 8 broad price segments I analyze, three price segments, representing 30% of all transactions, showed an increase in Average Sold Price. The segments are $1MM to $1.25MM; $1.25 to $1.5MM; and, $1.5 to $1.749MM. 65% of the homes that sold are still below the $1 million mark.

Interestingly, the metric most buyers are starting to focus on, Days on Market (how long it takes to sell a home), was approximately the same in 2007 as in 2006. Last year at about this time we advised all our sellers that the market change that would most affect them would be that buyers would be slower to buy. That was certainly borne out.

If you would like a copy of the analysis, give me a call. Check back often: I'm going to add summaries of Evanston, Winnetka and Kenilworth (in that order) over the next ten days.

Again, Happy New Year!

DS