Even though spring is here, we have not yet entered what we consider the "prime selling season " here in the land of northwoods lakes -- that starts in June about the time the school term ends. And the prime season is a short one, as it is pretty much wrapped up by late October. Buyers, sellers, and their agents have to be ready for the "season opener".
To prepare, let's review residential sales activity in western Vilas County over the last year - from 05/01/08 thru 05/01/09. I will define western Vilas County as the townships of Manitowish Waters, Lac du Flambeau, Winchester, Presque Isle, and Boulder Junction.
Sales from 05/01/08 - 05/01/09
| | All Homes | On-water Homes |
| Units | 59 | 45 |
| Avg. list | $429,336 | $495,659 |
| Avg. sell | $380,958 | $434,809 |
| | |
| List/sell ratio | 89% | 88% |
| Avg. DOM | 182 | 187 |
| | |
| Median list | $295,000 | $359,000 |
| Median sell | $275,400 | $329,900 |
| Median DOM | | 146 |
As of today, in the five aforementioned communities, 196 waterfront and 51 off-water homes (247 total) are listed in the Greater Northwoods Multiple Listing Service.
The market absorption rate numbers work out like this: For all homes, 247 are presently on the market. 59 sold in the last twelve months, for a monthly absorption rate of five. 247 divided by 5 equals a supply of 49 months - just over 4 years, at the present rate of absorption. Running the numbers for lake waterfront homes yields a supply of 52 months. Another way of putting this is that it would take 4 years and 4 months to sell all waterfront homes presently on the market at the present rate of absorption.
Some perspective on the abdorption rate statistics: 1. This time of year, increases in inventory outpace unit sales by quite a bit, so the months' supply of homes reaches its maximum in the late spring. It should drop as we march towards fall, even if the monthly absorption rate doesn't increase. 2. We do indeed have a lot of inventory, but unfortunately a certain percentage of that inventory has no chance of selling as it is still overpriced, even in this four-year old buyer's market. These properties are "For Sale", but not really "For Sale", if you know what I mean. The statistics would look quite a bit better if these properties could somehow be removed from the inventory as outliers before the absorption rate was calcualted. 3. Because we still do have a large number of overpriced homes on the market, a home that is properly priced for today's market ("positioned in the market" in real estate jargon) does stand a good chance of attracting offers precisely because it stands out from so many others.