The trends seen during Q4 2022 have continued into Q1 2023. While the market numbers were very similar to Q1 2022, with only slight differences in sales volume and new listings, the forecast for Q2 is showing a lack of inventory putting downward pressure on sales. Buyer demand remains strong within our market with many buyers ready to move once a property fits their criteria. Given interest rates have been elevated for many months, buyers who are seeking out loans, have mentally factored this into their decision-making process.
Across the region, there was a reduction in inventory, in Lamoille Country there was a 7% dip in new listings compared to last year. In Stowe, it was a more pronounced drop of 18%. Waterbury saw an increase of 10% year over year. Seasonality does play a factor in the reduction of listings this time of year. As we progress into the final half of Q2 there’s an expectation that inventory will grow as sellers look to capitalize on the continued buyer demand.
In our markets, and statewide, there is a sense that a return to a more normal market was due. This means we are seeing a more typical transaction process with contingencies like building, septic, and other inspections being conducted. As we continue to monitor the market, it’s imperative to have the right real estate advisor to help guide you to take advantage of opportunities in a market in transition.
Buyer demand helped to keep overall values fairly even in Q1 2023 compared to a year ago, with properties trading on average within 97% of their final list price. That being said there was a decrease in average and median selling prices of 24% and 29% respectively compared to Q1 2022.
The split between homes sold above and below $1M was even, with 6 homes trading below and 6 above. The average sales price of $1.554M was down from $1.932M a year ago. Multiple offers are still a factor on some homes that are properly priced, but there is less overbidding in those situations.
The luxury market in Stowe for Q1 2023 saw a slowing in terms of the number of sales as well as closed prices. There was almost a 50% decline in sales, with the high sale being $3.5M compared to $5.75M a year ago. The average days on market were 68, which was higher than 44 in Q1 2022, median days on market also tracked higher to 40 compared to 5 last year. The average and median sales prices declined year over year, from $2.4M to $2.068M, and $1.850M to $1.842M respectively. This segment of the market continues to be isolated from rate hikes as the majority of these buyers are paying cash.
While the overall market in Stowe remains strong, the declines were predictable as the trend from 2022 continued into 2023. As we progress into 2023 proper pricing will be paramount to a successful transaction in a reasonable amount of time. From a buyer’s perspective market knowledge and how to navigate making the right offer will help in securing the perfect Stowe property.
The condo market showed continued growth and resilience, bucking the trend set by single-family homes. There was a 50% increase in sales volume, with 24 units sold compared to 16 a year ago. Units sold on average at 98% of their last asking price, with the average and median pricing increasing by 80% and 34% respectively. There was also an increase of inventory by 36% in Q1 2023 and the days on market dropped slightly by 5%. What’s interesting in analyzing the difference between Q1 2023 and Q1 2022, is that in Q1 2022 the majority of the sales were located at the main lodge at Stowe Mt. Resort. In Q1 2023 the market varied between off Mountain condos, new construction, and stand-alone townhomes located at the resort. Stowe offers a diverse selection of condos, which appeals to the varying requirements of buyers. As we enter Q2, the condo inventory has seen a reduction with only 10 units available, and only three of which are below $1M.
Land had no change year over year in terms of sales volume with two parcels trading each year. There was an increase in average and median sales prices in Q1 2023, but with such a small sample size it’s not reflective of the overall land market. There are currently 10 parcels on the market, ranging from a 2-acre parcel close to the Morristown line for $299K to a 174-acre parcel off Weeks Hill asking $15M. The cost and time to build are creating negative pressure on the land market, but winter is also a time of year when land is the least attractive. The second quarter should bring new options to the market and as we progress into summer it will give us a better understanding of where the land market will end up in 2023. Land can be more challenging for buyers to understand, so it’s imperative to have the right team in place for guidance and marketing.
As we expand into all of Lamoille County, an area comprising 9 towns, in addition to Stowe, we see similar trends in the reduction of sales volume and new inventory. There was a decrease in overall sales by 31% and listings by 20%. The average and median prices did increase, showing strong buyer demand, compared to Q1 2022, they increased by 19% and 15%, respectively. Homes sold, on average, at 98% of their last asking price. Excluding Stowe, there are currently 22 homes available for sale, ranging from a mobile home for $72K to a 168-acre estate with multiple cabins asking $6.825M. Morristown, the largest economic driver of this area has a significant inventory shortage with 7 properties available, but only 2 below $500K.
Land sales saw a 50% reduction in overall sales, down to 6 in Q1 2023 compared to 12 a year ago. The average and median prices saw significant declines as well. The average price dropped by over $110K from $189K to $79K and the median price also decreased by $73K, from $140K to $66K year over year. There are 32 parcels available compared to 49 last year; 11 of which are located in Morristown and 9 in Cambridge. The cost of entry in relation to building, contractors, and materials will likely keep overall sales of land in check for 2023, but the cost to acquire land in Lamoille North continues to be far less expensive than Stowe or Waterbury.
*Figures reflected in the report (linked above) show all of Lamoille County including Stowe. The above narrative excludes the Stowe data.
Waterbury saw a burst of activity in Q1 2023 compared to Q1 2022, with 9 homes trading compared to 4 last year. There was a slight increase in inventory of one additional home hitting the market. Given the continued small sample size Waterbury offers, it will be important to keep monitoring the market to have a true read on values. The average sales price jumped by 60% and the median grew by 133%, thus showing how a small sample size can have a big impact on the short-term percentages. What’s most interesting regarding the transactions is that they sold, on average, at 95% of the last asking price. This shows that sellers ended up negotiating more off their last asking price compared to the surrounding markets of Stowe and North. There are 2 active listings available in Waterbury, ranging from $465K to $790K. Buyer demand for Waterbury remains strong as evidenced by the increase in sales in Q1, as we move into Q2 we expect that demand to remain.
Land in Waterbury did see a decrease in sales, with 1 parcel sold in Q1 of 2023, compared to 3 in 2022. There are 3 parcels available on the market, which is not uncommon for this time of year, but they have an average days on market of 150. This is an indication of the overall pullback in relation to building as an alternative to buying an existing home.
Since Waterbury has such a small sample size in single-family and land sales, we will continue to monitor the market to seek further indicators of where 2023 will head. Those with homes and parcels to sell should seriously consider bringing them to market in 2023, as the overall Waterbury market remains in high demand.
In changing markets, it’s paramount to have an expert advisor at your side as you make decisions whether that is when to list or how to structure your offer to be the most competitive. Having access to resources unique to this profession, knowledge, and expertise; agents are equipped to provide their clients with up to the minute market data information, and new listing alerts, helping clients to make informed decisions in an effort to achieve the best outcome. All this along with leading technologies render support and advice that is critical for Sellers and Buyers to have as well.
As our office analyzes the start of 2023 and the direction for the rest of the year, we remain very positive about our area. We know real estate is locally focused, but our global reach provides us with unique insight into how outside factors can be leveraged to a local advantage. We work hard to identify our own trends and opportunities combined with global reach to best fulfill our clients’ goals.