By Phil Dodd
While the number of sales of existing homes fell a bit in 2018 compared with 2017, median prices in most Central Vermont towns rose, and median listing prices jumped even more.
In Washington County as a whole, the number of sales of existing single-family homes and condos fell 9.9 percent to 548, according to statistics compiled by the Vermont Association of Realtors (VAR). That compares with a drop in volume of 7.5 percent in Montpelier (to 86 sales) and 10.2 percent in Barre (to 150 sales).
Possible reasons for the volume declines include higher interest rates in 2018 and the fact that prices are getting out of reach for more people. But Realtor Tim Heney of Heney Realtors pointed to another possible reason: a lack of inventory. “We only have 15 houses and condos on the market right now in Montpelier,” he said in late February. “We could use more like 60 or 70.”
Strong demand and lack of inventory means homes are selling quickly. During 2018, there was an average of 4.1 months of inventory available in Montpelier at current absorption rates, down from 5.3 months in 2017. Barre averaged 6 months worth of inventory in 2018, down from 7.6 months in 2017, and Washington County had 7.6 months of inventory in 2018, down from 10.3 months earlier.
The 2018 median price for an existing home in Montpelier was $244,306, up 5.4 percent from a year earlier. Heney said there was particularly strong demand in Montpelier in the $250,000 to $350,000 range, causing prices for those types of homes to increase the most.
The 2018 median price in Washington County was $214,460, up 7.8 percent from 2017. Barre’s median price was flat, falling 0.1 percent to $169,818. That means a median-priced home costs 30 percent less in Barre than in Montpelier.
The median listing price jumped 22.5 percent in Montpelier to $348,482; it rose 19 percent in Washington County to $236,296, and it went up 8.7 percent in Barre to $179,794. The big increases in listing prices indicate either that sellers are feeling emboldened and raising their asking prices or that more high-value homes are coming on the market, or both.
What lies ahead for local real estate in 2019? Predicting the future is challenging, but it is notable that—following months of stock market volatility and the government shutdown—consumer confidence rebounded in February to its highest reading since December 2000, according to the Conference Board. That should be good for the market.
It may also be worth noting that the high consumer confidence reading in 2000 came near the peak of a 10-year period of economic growth that ended just three months later, in March 2001, when an eight-month recession kicked in.