We ended the 1st Quarter with 69 closed escrows (detached homes) at an average sale price, per sq. ft, of $328. Compared to the same period last year, we had the exact same number of sales. However, as recent trends have suggested, the average sales price, per sq. ft., dropped 4.4% from the 1st quarter of 2006.
All things considered, this is certainly not the precipitous drop in sale prices that many have suggested or feared. With a reasonable inventory of just 91 homes currently on the market, there is a 4-month supply at current absorption rates.
In the “Attached/Condo” market, there were 42 closed escrows during Q1, 2007, compared to 52 closed escrows for the same period last year, a 19% drop. However, sales prices (per sq. ft.) were down only 2.2%, or half the decline of detached home prices. There are currently 60 condo’s on the market in Scripps Ranch, a 4.25 month supply at current absorption rates.
Although this 3- month trend may still be too limited to form firm conclusions for the remainder of the year, it does confirm what we have been seeing and forecasting for the past year. The market, in general, continues to adjust and retrench after the super-heated preceding five years, but in a surprisingly moderate and orderly way. This suggests that we should expect the current trend to continue for at least the remainder of the year as equilibrium is reached. Beyond that, my best guess is that we will maintain stability for several years to come, assuming interest rates remain at or close to current levels.