First Quarter Market Report

Our model home at South Village in South Burlington.
Single Family    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$296,500 +2.4%
$338,089 +4.2%
374 +6%
529 -12.3%
99 +8.8%
Condo    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$257,600 +8.5% $283,475 +10.4%144 +26.3%184 +19.5%67 -14.1%

We cannot comment on the 1st quarter results without reflecting on the Coronavirus pandemic that arrived in the midst of it and will continue to impact us for the remainder of 2020. During the recent weeks, we have been reminded about the role HOME plays in our lives. We thank our state officials, health care providers, and all essential workers for the sacrifices and difficult decisions they continue to make to keep our community safe. 

Residential real estate transactions have a longer lead time than most consumer purchases. These transactions close, on average, 45-60 days from the time of contract. Therefore, results in this 1st quarter market report – with sales closed by March 31st – reflect business efforts from the 4th quarter of 2019 through January of this year.

The current public health crisis we find ourselves in is already resulting in an economic crisis. As the residual impact of COVID-19 begins to plateau, the question we are being asked is “what will the impact be on the real estate market?” We don’t have a crystal ball, however, John Burns Real Estate Consulting noted, “Historical analysis showed us that pandemics are usually V-shaped (sharp recessions that recover quickly enough to provide little damage to home prices) …. the current slowdown is playing out similarly thus far.” As of April 1, 2020, three of the major financial institutions, including Goldman Sachs are calling for a V type recovery. They do reserve the option to change that prediction as things proceed.

The Great Recession of 2008 was driven largely by the housing sector. This is not the case today. In fact, the leading indicators regarding housing were sound at the onset of this necessary pause. Nationally, inventory levels were at a 3-month supply (vs. 8-month supply in 2007); most economists believe a 6-month supply is a balanced market. We have been in a sellers’ market for some time. Price appreciation has been steady and moderate. In addition, the equity position for most home owners is strong.

We cannot predict how long we will be sheltering in place or how deep the impact will be prior to working our way out of this. We do believe that this time, housing is poised to be part of the solution.

“Housing is a foundational element of every person’s well-being. And with nearly a fifth of US gross domestic product rooted in housing-related expenditures, it is also critical to the well-being of our broader economy,” as recently noted by Chris Herbert of the Joint Center for Housing Studies at Harvard University. The fact that the Vermont housing sector enters this current recession underbuilt rather than overbuilt, coupled with continued historic low interest rates, positions housing to help lead our way out of this when the time comes.

In Northwest Vermont, the real estate market during the 1st quarter of 2020 was strong. The number of properties listed for sale continued to increase after years of decline. Buyer demand was strong amidst low interest rates and median prices were steadily growing. Governor Phil Scott issued a Stay At Home order on March 25th which effectively put the brakes on real estate services. Purchase contracts already in process faced some hurdles getting to closing. With safety and public health as a priority, attorneys and lenders adjusted their customary practices and closed real estate sales without parties present – via Power of Attorney. Buyers and Sellers in newer contracts, that had not worked through contingencies such as property inspections, have extended those contract deadlines when possible.

As of April 20th, the Governor is allowing limited in-person activities of no more than two people. Many buyers we have surveyed are remaining in the market. Detailed property photographs and video enable savvy buyers to make offers subject to inspections at such a time that is deemed safe. Our agents are advising clients to work with a local lender for an up to date mortgage pre-approval.

Sellers are using the time at home to prepare for market. Our Marketing Team is working closely with sellers to produce videos and strategically position their homes for optimal viewing by buyers. Our website, HickokandBoardman.com, has been visited by potential buyers across the country- notably from states effected early on by COVID-19. Vermont has long been considered a healthy and safe place to live. Particularly in the aftermath of a crisis, such as the events of 9/11, many residents of larger cities looked to Vermont to begin the next chapter in their lives. Recently, Conde Nast Traveler announced the 2019 Readers’ Choice Awards for the Friendliest Cities in the U.S., ranking Burlington 8th in the country – the only northern city on the list.

While working from home and conducting meetings via apps like Zoom may be new for many, our Agents have been effectively working remotely for several years. From using technology to share and sign contracts, to conducting showings and consultations via Facetime with out-of-state clients – we are well positioned to best serve our clients.

Never more than now, do we appreciate what HOME means to all of us. Stay safe and hold your family and friends close. We appreciate the relationships we share with all of you and together we will work to keep #VermontStrong.

We are All in this Together

COVID-19 and the Spring Real Estate Market

The Vermont Market Report released on April 22 reflected a strong residential real estate market in Chittenden, Addison, Franklin, and Grand Isle Counties for the first quarter, January through March 2020. While newly listed single-family homes were down 12% putting a stress on inventory – buyer demand, fueled by low mortgage rates, continued to grow with a 6% increase in homes sold and a steady median price growth of 2.4% to $296,500, the report showed.

As we noted in the Vermont Market Report, results of closed sales through March 31, 2020 reflected business efforts from the 4th quarter of 2019 through January as transactions take an average of 45 – 60 days to close. See the full Q1 Vermont Market Report.

Governor Scott’s Stay at Home order on March 25th effectively put the brakes on real estate in April, the start of what is historically the busiest time in real estate. While 20% fewer homes (single-family and condominiums) closed during the month this number reflects properties put under contract in February and March, prior to the Stay at Home Order.

Market data for April 2020 will be a leading indicator of the impact COVID-19 has had on the real estate market in Northwest Vermont for the coming months. Newly listed residential property declined 45% across Chittenden, Addison, Franklin, and Grand Isle counties resulting in 31% fewer homes for sale compared to a year ago. Another indicator of things to come is the number of properties put Under Contract during the month as those properties are likely due to close in May and June. Chittenden County, down 50%, felt the greatest impact of properties going under contract during the month of April. Since April 20th restrictions of property inspections, appraisals, and in-person showings were lifted following strict guidelines of the state and CDC. Agents have reported multiple offer situations as buyers and sellers regain confidence to continue their move.

County Apr-19Apr-20ChangeChange %
ChittendenFor Sale619433-186-30
Under Contract204102-102-50
Sold12498-26-21
New Listings222116-106-48%
Median Price $314,000 $326,250 $12,250 4
AddisonFor Sale259182-77-30
Under Contract3229-3-9
Sold2618-8-31
New Listings6331-32-51%
Median Price $260,950 $294,500 $33,550 13
FranklinFor Sale366264-102-28
Under Contract6340-23-37
Sold4038-2-5
New Listings7452-22-30%
Median Price $225,656 $250,000 $23,344 11
Grand IsleFor Sale14183-58-41
Under Contract126-6-50
Sold53-2-40
New Listings2310-13-57%
Median Price $148,000 $208,000 $60,000 41
4 CountiesFor Sale1385962-423-31
Under Contract311177-134-43
Sold195157-38-20
New Listings382209-173-45%
Median Price $277,800 $295,000 $17,200 6
*Sales reported through the NEREN-MLS: Single family & condominium homes sold, April 2019 vs April 2020, Chittenden, Addison, Franklin, Grand Isle

In April, the median residential sale price across the 4 counties was up 6% to $295,000. “Northwest Vermont has been in a sellers’ market in many price points for some time,” says Leslee MacKenzie, President/Owner of Coldwell Banker Hickok & Boardman. “Unlike the Recession of 2008, driven largely by the housing sector, this current economic shock is driven by a public health crisis. The real estate market is better positioned in 2020 for a faster recovery. In addition, many homeowners have built positive equity since 2008- another leading indicator on how housing may fare as state and health officials navigate safe and measured ways to re-open the Vermont economy.”

Coldwell Banker Hickok & Boardman has been guiding Vermonters home since 1958. The company ranks among the top 50 Coldwell Banker Offices nationwide and was honored as a 2020 Best Places to Work in Vermont. The company has three offices: Burlington, Vergennes, and St Albans.

Addison County Market Results

Enjoy deeded access to Lake Champlain in this small community in Addison. | MLS# 4790693

Single-Family Homes    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$220,500 -6.2%
$255,761 -2.3%
50 -12.3%
76 -16.5%
169 +33.1%

Condos    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$229,900 +99.9%
$229,759 +58.6%1 -66.7%
4 -20%20 -70.2%

Chittenden County Market Results

Beautiful 3 bedroom home, on 3 acres in Hinesburg, offers beautiful living spaces and custom craftsmanship! | MLS# 4798186
Single-Family Homes    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$351,000 +4.8%
$413,337 + 5.8%208 +5.6%
276 -15.6%
45 +17.7%
Condos    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$267,500 +11.7%
$291,699 +10.8%
132 +25.7%
162 +15.7%
59 -20.3%

 

Franklin County Market Results

Unique and beautiful property near Jay Peak with Farmhouse, log home, guest cottage, and sugaring operation. | MLS# 4766884

Single-Family Homes    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$227,750 +9.1%
$233,595 +7.6%

96 +23.1%

139 -8%

116 -2.5%

Condos    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$189,900 +2.4%
$189,659 -4.5%
11 +83.3%

18 +125%
122 +82.1%

Vermont Land Market Results

Private 3.2 acre lot with over 290 feet of Lake Champlain frontage in Ferrisburgh | MLS# 4768095
 MEDIAN SALE PRICEVS 2018UNITS SOLDVS 2018NEWLY LISTEDVS 2018DAYS ON MARKET
All Counties Land$87,500 -27.10%26-16.10%1040%260
Chittenden County$208,000 73.30%9-30.80%26-23.53%211
Addison County$82,250 -20.70%100.00%3042.86%347
Franklin County$48,000 -41.30%716.70%34-19.05%200
Grand Isle County----14100%-

Early 2020 Market Report

Custom Home on 10+ acres in the remarkable countryside of Shelburne! MLS# 4771575

Single Family    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$303,500 +3.6% $345,361 +6.1%2,530 +11.3%3248 +4.9%73 -16.1%

Condo    
Median Sale Price:Average Sale Price:Units Sold:Newly Listed:Days on Market:
$245,000 +6.5% $276,300 +6.4%756 -0.1%835 -6.9%65 -7.1%

Last year at this time, we provided our recap of 2018 and projections for 2019 based upon analyst predictions for the national and local real estate market. Limited inventory of homes for sale remained the top story. The stock market was volatile; a government shut down impacted the economy and housing market for a short time; mortgage interest rates were projected to reach 5.25% by the end of 2019; and there was talk of a looming recession. Despite those predictions, 2019 was a strong year for real estate. 

While the supply of homes coming on the market remained lower than buyer demand, many parts of our region reflected an increase in inventory. The median sale price grew, enticing home owners to sell in order to maximize their equity. Interest rates dropped in 2019 by .75-1.0% points and will remain low in 2020 – likely somewhere between 3.7% and 3.9%.

With low mortgage rates, low unemployment, and continued wage growth, home buyer activity is expected to remain healthy in 2020.

Millennials, many saddled with heavy student loan debt, have made their mark on the real estate market after many years on the sidelines. At the start of 2019, Millennials accounted for 45% of home buyers. This group is expected to dominate the market again in 2020. Realtor.com expects millennials to make more than 50% of all home purchases in 2020. As home prices increase, Millennials look toward more affordable places to put down roots – namely smaller locales on the outskirts of cities and towns. This has led to the term “hipsturbia communities” – live-work-play communities. Vergennes and Bristol in Addison County & Winooski, Jericho and Hinesburg in Chittenden County are examples of towns with healthy increases in homes sold – perhaps as result of Millennials buyers entering the market.

Baby Boomers, on the other end of the housing spectrum, are staying in their homes longer than ever; 10-13 years on average vs 7 years, historically. These home owners are willing to sell their large family homes but are having trouble finding new home that are right-sized, with easy maintenance so that they can enjoy the lifestyle they have worked so hard to achieve. Their large, family homes may not appeal to energy conscious Millennials also seeking life balance.

New construction projects play a key role in easing the inventory shortage, delivering homes that today’s buyers are looking for and stabilizing pricing. Builders face challenges in land, permit and materials cost as well as shortages in labor which puts the price of new homes in the area well above $400,000. Some communities are challenging new developments, with neighbors raising concerns about the loss of green space and wildlife habitats. The quality of life that draws people to Vermont needs to be carefully balanced with the cost of living in our beautiful state.

2020 will remain a seller’s market in most of the region, with a true buyer’s market not on the immediate horizon. Multiple offers on homes priced near the median for the market and located in sought after towns will continue through the year; however, conditions are favorable for real estate.

Buyers and sellers alike should have these best practices in mind: identify your wants and needs, learn about the market, form reasonable expectations, perform your due diligence, and be prepared to act – with the assistance of a skilled and trusted Realtor.