It's a buyer's market in New Hampshire real estate

By KAREN SPILLER, Telegraph Staff

August 6, 2006

NASHUA – Maggie Decker put her two-bedroom, garden-style condominium on the market in February for $149,900.

She has lowered the price $8,400, has offered to pay closing costs and even threw in a warranty.

Six months later, her Knightsbridge Arms condo still hasn’t sold.

“Last year, you could have pretty much named your price,” said Decker, 50, of Nashua, a program manager at Southern New Hampshire Services. “This year, the number of houses and condos on the market is ridiculous.”

Nationwide, there are 33 percent more homes listed for sale now than there were last year. And more supply equals more power for home buyers.

“It’s definitely transitioned into a buyer’s market,” said MaryBeth Gustitus, a “team leader” with Keller Williams Realty in Nashua.

When housing inventories are above a six-month supply of homes, the market is considered a buyer’s market – one that favors the buyer in negotiating a lower sales price. Currently, there’s a seven-month supply in Nashua, Gustitus said.

In Greater Nashua, 923 homes were sold at an average price of $282,952 between Jan. 1 and May 31. This year’s numbers are down compared with the 1,045 Greater Nashua homes sold at an average price of $275,218 during the same time last year, according to the New Hampshire Association of Realtors.

Homes in the area are staying on the market longer – an average 119 days, compared with 114 days last year.

What this means is that sellers have to aggressively market their homes, local real estate agents say.

“The problem sellers face . . . they still think their home is in a market where it’s going to sell in the first two or three weeks,” said Ben Mercuri, an agent with RE/MAX Properties in Nashua.

It’s good news for home buyers. Today’s real estate market is a far cry from the booming market consumers have enjoyed over the last five years. These days, there’s more negotiating going on.

“What’s moving is the more affordable properties,” Gustitus said. “What that tells us is our buyers are shopping on value, and they’re taking longer to do it.”

Nationwide, sales of existing homes were down in June, and the number of houses on the market rose to their highest point since 1997, according to the National Association of Realtors.

So, why the change in the market?

For one, mortgage rates have gone up. The average 30-year fixed rate is up more than a point in the last year to 6.7 percent.

With higher rates, buyers can afford less, and it goes back to buying the value house, Gustitus said. So if sellers want to move their property, they have to lower prices.

Another reason is lower demand for new housing and an overabundance of supply. As a result, buyers feel a lot more confident with the purchases they do make, Mercuri said.

“It doesn’t have to be spontaneous,” he said.Don’t panic
Brian Moses, owner of Coldwell Banker Brian Moses Realty Inc. in Nashua, classified the market as normal.

“It’s not a depression or a bubble,” he said. “We’ve really been tremendously spoiled over the years and the real estate market has been robust with double-digit increases.

“I don’t’ think it’s any reason for anyone to hit the panic button.”

The market trend is good for buyers because they have lots of selection, Moses said. But it’s also good for sellers because homes are still selling.Curb appeal
Gustitus’ advice for sellers is to understand where their house fits in with the market. On the whole, she said the reality of prices is starting to sink in with sellers.

“They’ve had six years of them seeing their neighbors sell at full price. That became a normal market for them. The problem is, that’s not a normal market. That was the perfect storm.”

Another tip: make sure your house has “curb appeal.”

“It’s got to compete on aesthetics and value,” she said. “There’s so much inventory that buyers can’t physically look at every house. If your property can’t compete outside, they’re not even going to go inside.”

Gustitus had a Nashua home listed last year that sold for $270,000. She said there’s a similar home on the same street this year with some extra amenities – including a two-car garage and a better location – that will probably sell for no more than $260,000, she said.

“It tells me it’s all about supply and demand,” she said, adding that today’s available housing inventory (or the time it takes to sell all the homes at last year’s pace) is a seven-month supply.

“When you have a seven month supply, buyers can be choosy. They’re coming prepared to negotiate.”

But they’re also willing to pay a fair price, Moses said.

“We’re advising our sellers, ‘Don’t give your house away. It’s not necessary,’ ” Moses said.

Meanwhile, Nashua’s Maggie Decker is hoping she finds a buyer, and soon. She and her husband are looking forward to moving into the house they’ve already purchased in Rindge. But first, they have to sell their Knightsbridge condo.

“The agents said it showed beautifully, but there was just so much on the market and our timing was just a little bit off,” Decker said, adding that the condo would have been sold already this time last year.

“It’s emotionally wrenching.

These are figures for homes sold in Nashua so far this year and over the last three years:

YEAR	HOMES SOLD	AVGE LIST PRICE	AVGE SALES PRICE	AVGE DAYS ON MARKET
2006	330	$317,640	$311,245	69
2005	750	$318,905	$314,589	58
2004	759	$295,429	$296,094	51
2003	726	$271,290	$270,973	49