There are two parts to this summary. The first part, General Trends in the Los Alamos Market provides data on price trends since 1996. We present the average price per square foot of homes in the Los Alamos - Jemez area; similar statistics are presented for individual areas.

The second part, Specific Measures of Market Activity describes some means to assess the type of market activity - is the market very active or slow, is it a "sellers' market" or a "buyers' market"?


Executive Summary

The Los Alamos real-estate market can be considered a very favorable market for buyers. Houses are selling at a rate that is lower than average for a normal market, and have dropped by several percent since the middle of 2007!

Figure 1 presents the average price per square foot of homes since 1996, in semi-annual steps. The figure also presents the "spread" (aka "standard deviation" for statisticians), that is a measure of the range around the average value that one can expect the price of homes to be in. As an example, in the second half of 2007, the average price of a home is 145 dollars per square foot, and the spread is 33. This implies that approximately 2/3 of the homes sold will be in the range 112 (145-33) to 178 (145+33) (dollars per square foot). The sales price of a home depends on many factors, and the average price is appropriate for an "average" or typical home. We note that between 1999 and 2001, there were no significant changes in the average price for homes in the Los Alamos area. In 2002, there was a significant increase, of close to 10%, from the end of 2001. Since then, prices have increased steadily till the middle of 2004, and subsequently leveled off till 2006, where we note an average increase of 6.8% in the first half of the year. However, there has not been an increase since then, and since mid 2007 we have seen a decrease of the average price by about 12%. Since we started these statistics in 1996, we have seen an increase to date of 52% in average prices of homes.

Similar trends are evident in figure 2, that details prices for Barranca Mesa (including Ponderosa Estates till 2004), White Rock and North Mesa. Prices in White Rock and North Mesa have decreased by about 15-20%, whereas Barranca prices have gone down by about 8%.

Figure 3 presents similar data for other areas.

Specific Measures of Market Activity

Supply (number of homes on the market) and demand (the number of qualified buyers looking for homes), as well as the perceptions of buyers and sellers, determine whether the market is a "buyers' market" (i.e., since there are few buyers compared to the number of houses on sale, buyers can strike good deals), or a "sellers' market" (i.e., a relatively large number of buyers sometimes competing for the same listing, driving prices up). We consider some indicators to help us determine the market we have in mid-2008.

• The number of homes sold above asking price (Figure 4). This number will increase in a sellers' market, because buyers make offers that are higher than the listing price, in order to close a deal before competition starts, or to outbid a competitor. In 2002, the number had increased significantly, to about 25%, but since then, has declined to a December 2007 value of 6.7%, and in the last six months (January to June 2008), no homes have sold above asking price!. This number is one of the indicators of a buyers' market.

• The average sales price is usually a little lower than the asking price. In a sellers' market, the sales price comes closer to the asking price. Figure 5 presents how much lower (in percent) the average sales price is, compared to the asking price.
  

• The number of days a home is on the market decreases in a sellers' market. Currently, the number of days that a house is on the market (till a contract is signed) is at an all time high of 153 days! Further analysis shows that 39% of the homes that came on the market in the first half of 2008 came under contract in 2 months. One can conclude that houses that are priced appropriately can sell, but it could take a couple of months.
  
  

• The number of houses sold in any given period is another indicator of the vitality of the real-estate market. This number bottomed out in the second half of 2004, and peaked in the first half of 2006. However, in the first half of 2008, 90 houses sold, the second lowest number compared to the previous years since 1996.
  
  

So what can be deduced from these data? Mid 2008 finds us with a strong buyer-oriented real-estate market, with around 320 properties for sale. In mid-2005, there were more than 280 houses on the market, waiting more than three months (on average) till a contract is negotiated. Now, the waiting time is longer, and less houses are sold. Sellers can still get a good price for their home, but not should not expect as high a price as they could get a year or two ago. So, if you are considering buying a home, please contact me at your earliest convenience to start looking. If you are considering selling, please contact me to make sure you get the most up-to-date information and assistance to sell your house without delay. Houses can sell when priced right!

Please feel free to consult the maps as needed:

Los Alamos map
White Rock map