Ascension Parish Real Estate Market Report
The data used in this report were extracted from the Greater Baton Rouge Association of Realtors MLS database. The data are presumed accurate but are not warranted.
As 2009 comes to a close the real estate market in Ascension Parish is continuing to resist the gloom haunting other markets in the country and is, in fact, showing signs of growth. The following chart shows monthly unit sales for the past several years. For September 2009, sales of previously owned homes exceeded sales in that market segment in both July and August of this year and approached sales in June 2009 which was the highest so far this year. While new construction unit sales didn’t perform as well as the previously owned market segment for September 2009, it significantly outperformed new construction sales in September 2008. This is not surprising since both the new and re-sale market segments were hard hit by the devastation caused by hurricane Gustav last year. That said, new construction unit sales last month outperformed all other months in 2008 except for the month of July.
Using the average absorption rates observed so far this year, unit sales of the new construction market segment is projected to exceed 2008 levels. Unit sales for the re-sale market segment is projected to be only slightly less than that of 2008. Clearly, while less robust than the boom post-Katrina times, the real estate market in Ascension parish is showing remarkable signs of health despite the current difficulties we face in acquiring credit.
The next two charts show historical trends of average selling price and average selling price per square foot for both market segments.
We can see that in the resale market segment, neither the average price nor the average price per sq.ft. have changed substantially from 2008 levels. This indicates that the equity in our residential real estate investment has weathered the economic downturn quite well. In the new construction segment, however, we see a downward shift toward more affordable housing… a trend previously reported on toward smaller homes with fewer upgrades and amenities.
The next two charts show the absorption rates and inventory levels for the two market segments. In the new construction segment, there is only a 3.3 month supply of new homes overall. This is a Seller’s Market. A Buyer’s Market condition exists only for homes priced over $400K. The highest velocity of home sales exists in the $150K-$250K price range which accounts for 65% of all new homes sold this year.
The previously owned market segment shows the highest velocity of sales in the same $150K-$250K price range which accounts for 51% of home sales. In fact, home sales under $250K accounted for 73% of all homes sold. Overall, it is a neutral market with 6.4 months supply but there is a great variation in this figure as we look at various price ranges. Previously owned homes over $400K have sold at a rate of 1.6 homes per month. With 60 homes on the market, at this rate it will take more than three years so sell off this inventory. At the other end of the spectrum, homes priced under $250K are enjoying robust sales and it is a Seller’s Market in these price ranges.
As always, I appreciate hearing from readers and I welcome any comments or suggestions for improvement that you may offer.
©2009 by Don Stern - All Rights Reserved
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