The Putnam County housing market finished 2017 with a flourish, as low levels of inventory drove prices up dramatically.
Sales. Putnam single‑family home sales were up a tick for the quarter, following three straight quarters of decline. For the calendar year, sales were down over 7%, marking the first time in over five years where the yearly sales have gone down. This is not, though, due to a lack of demand, but rather a sign of the impact of severely low levels of inventory.
Prices. This lack of inventory drove a major spike in pricing in the fourth quarter, with prices up dramatically across the board: up almost 11% on average, over 8% at the median, and over 10% in the price‑per‑square‑foot. This was by far the largest quarterly increase in over 12 years, since the height of the last seller’s market. And one good quarter saved the year, with 2017 prices finishing up just a bit for the second year in a row.
Inventory. Inventory continued to tighten, falling over 6% and now down well below the six‑month level that usually denotes a tightening seller’s market. This lack of available homes is what’s been holding back sales, since we don’t have enough “fuel for the fire” to keep the market going.
Negotiability. The negotiability indicators support the idea that a seller’s market is emerging, with the listing retention rate up just a tick and the days‑on‑market continuing to fall.
Condos. The smallish condo market surged in the fourth quarter, with sales up over 18% and prices up just a tick. For the year, though, sales were down sharply and prices gave back a little, even while inventory continued to fall.
Going forward, we believe the Putnam County market will thrive in 2018 as a robust seller’s market. Demand will stay strong, with interest rates near historic lows, prices still at attractive 2004‑05 levels, and a strengthening economy. And if inventory remains low, prices will likely continue to appreciate meaningfully through the new year.