Solon Real Estate Market – Year In Review 2011

The following is our annual year in review for Solon Ohio real estate. We will give sales and pricing statistics for 2011 and make a comparison to 2010. Commentary will be provided afterwards.

ALL HOMES

Year          # of Homes Sold        Ave. Sales Price   Sales Price/List Price

2011                      227                    $287,205                 94.24%

2010                      202                    $292, 547                94.61%

WHAT ABOUT BANK OWNED HOMES?

While bank owned homes constitute a small percentage of sales, they still have a tendency to affect home values. We were curious to see what the numbers would look like if we excluded bank owned homes and have included them below:

2011                      212                    $291,708                 93.50%

2010                      192                    $293,265                 94.53%

LUXURY HOMES ( sales price over $500,000 )

2011                       29                     $626,888                94.58%

2010                       25                     $645,830                94.17%

2011 FIRST HALF VS. SECOND HALF OF THE YEAR

Jan. – June                99                 $282,575               94.40%

July – Dec.                113               $301,013               94.11%

Source: NEOHREX

COMMENTARY

While the last few years have been challenging to say the least, this past year showed us some positive signs. Below is a list of 5 important things that the above statistics tell us:

1.     2011 had more home sales than 2010

2.     The average price of a home in Solon was almost unchanged

3.     The market IMPROVED during the second half of 2011

4.     Homes are selling for a healthy 94% of asking price

5.     Affluent buyers are feeling more confident

INCREASED CONFIDENCE

The numbers show that buyers were more comfortable buying a home in 2011 compared to the previous year. There are likely many factors involved here, including a very slightly improving economy. The fact that values have stopped declining is worth noting as well.

Over the past few years, when home values were declining, buyers were not willing to pay market value for a home. Many buyers, fearing the market would continue to decline,  would attempt to buy a home for 5-10% less than market value just so they could have some security in the event the market continued to depreciate.

Basically, buyers wanted a built in cushion to protect them from future market fluctuations. As you could imagine, this approach didn’t fare well with sellers. Buyers are now more comfortable paying market value for a home, although bringing buyers and sellers together is still a challenge.

Moving forward, the recovery in the local market will still take some time. Areas like Solon will continue to be desirable thanks in part to the highly rated school system, but the Northeast Ohio real estate market in general is still soft.

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Here is our official 3rd quarter home value report for Solon Luxury Homes complete with a comparison to 2009. 

Please keep in mind that in the Cleveland real estate market, the definition of a luxury home is one that sells for at least $500,000. Commentary to follow. 

Here are all luxury homes that sold in Solon during the Third Quarter of 2010:

THIRD QUARTER 2010 VS. THIRD QUARTER 2009 COMPARISON

Luxury Sales     # of Homes Sold      Ave. Sales Price                Ave. Days on Market

2010                          6                      $673,250                             145

2009                          9                      $560,247                             131 

YEAR TO DATE COMPARISON

2010                         20                     $641,088                             170

2009                         27                     $600,069                             129

Commentary:

Through the first three quarters of the year, we have less luxury home sales in Solon than at this time last year, and the market for homes priced over $750,000 remains extremely soft. However, the average home price has increased from 2009. So, what does that mean for the values of Solon luxury homes?

To begin, it would not be fair to look at the above statistics and make a blanket statement that Solon luxury home values are up around 7%. The increase in the average sales price is more likely due to a lower number of distressed luxury homes being sold this year than an actual increase in home values. However, we feel that prices at all levels are no longer decreasing and have leveled off. In addition, appraisers that we have spoken with say that Solon is seen as a stable market in terms of home values although they are taking a little longer to sell.

The interesting thing to note is that many surrounding suburbs are seeing an increase in both sales AND average home price, especially in the luxury home market. So why is that?

We believe that the demand for a luxury home in Solon is just as high if not higher than in any  neighboring suburb. The fact is that if someone wants to buy a luxury home on the East side of Cleveland that has been built within the last 10 years, Solon is pretty much the only place to go. Added to that, Solon has one of the top-rated school systems in the State of Ohio. However, the sellers here are in a different situation than luxury home sellers in older areas of town, and here’s why: 

All of the people who are selling a luxury home here in Solon bought or built their home when prices were higher. The market appreciated during the first part of the decade, peaked in 2005, and then declined. In fact, many economists believe that housing prices are currently at the same levels as they were 10 years ago. In addition, many current sellers, especially those that bought new construction, spent a lot of their own money on landscaping, window treatments, and perhaps even a finished basement. Therefore, there is a big difference between what a seller has put into their home and the current market value.

Simply put, most sellers either cannot afford to sell at the current market price, or are refusing to accept the loss they will have to take. When pricing their homes for the market, many sellers look at what they paid, add how much money they put into the home, and come up with a listing price. This strategy just doesn’t work in today’s market, or in any market for that matter, as evidenced by the sales numbers listed above. There is simply a disconnect between Solon luxury home sellers and the price buyers are willing to pay for a home. We are certainly not trying to be negative here, but that is our honest assessment of why luxury home sales in Solon are down.

When trying to determine the value of a home in Solon, it is important to have an reliable method for coming up with value. Looking at national or even regional housing statistics is nice, but is not necessarily relevant as real estate is very local. The best way to value a home is by finding out what similar homes in the same neighborhood have recently sold for and account for any differences that these homes had compared to the subject property.

The bottom line is that nice homes priced well still sell in any market, but expecting to make money if you bought recently simply isn’t realistic. This may be harsh reality for some sellers out there, but it is the nature of the market.

When all is said and done ( and I’m not just saying this because I’m an agent ) there is no substitute for having a local real estate expert help with this process, specifically someone who has personally been inside many of the homes here in Solon. Below are past articles that relate to the content of this post.  

2009 Year End Luxury Market Report Solon Ohio

Solon Agent Receive Luxury Home Designation

2008 Luxury Market Report Solon Ohio

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About The Authors

The above information pertaining to Cleveland Real Estate News was provided by The Schuman Team, Amy and Dan, of Howard Hanna.  They can be reached at 216-346-3235 or via email, danschuman@howardhanna or amyschuman@howardhanna.

We service the following Cleveland area suburbs: Bainbridge, Bay Village, Beachwood, Bentleyville, Chagrin Falls, Cleveland Heights, Gates Mills, Highland Heights, Hunting Valley, Lakewood, Lyndhurst, Mayfield Heights, Mayfield Village, Moreland Hills, Oakwood Village, Orange, Pepper Pike, Shaker Heights, Solon, South Euclid, University Heights, Westlake, Woodmere.

Solon Ohio Luxury Home Value Report 3rd Quarter 2010 is the property of The Schuman Team and may not be duplicated or used without their written consent. ©October,2010

Moreland Hills OH Real Estate – Home Value Report 3rd Quarter 2010

Before we discuss home values and trends in Moreland Hills, OH, we will first provide a list of all the homes that sold here during the 3rd quarter of 2010. We will then provide a comparison to the third quarter last year and also give year to date comparisons between 2010 and 2009 as well.

Below are sales of Moreland Hills OH homes during July, August, and September of 2010. 

Overall, there were 8 sales during the third quarter of 2010 compared to 11 in 2009.

Here is how the third quarter this year compares with the same time period from 2009 in Moreland Hills:

SUMMARY

To begin, Moreland Hills OH is a very exclusive community with a limited number of home sales. With such a small amount of data, statistics can sometimes be misleading or inconclusive.

So far this year, we have seen 21 home sales at an average sales price of $399,662. There are currently 6 homes under contract, all will most likely transfer before the end of the year.  Last year through the first 3 quarters, we had 26 home sales averaging $350,391. We could conclude that although sales are down, Moreland Hills home values are up compared to last year.

As previously mentioned, with a limited number of sales, it can sometimes be difficult to really get a fair grasp on where home values are heading in Moreland Hills. One good sign is that Moreland Hills luxury home sales, those over $500,000, are up so far this year. So far, there have been 5 sales over $500,000 with the highest being $1,250,000. There are 3 currently under contract. Last year at this time, we only had 3 sales over $500,000. 

So, the fact that the luxury home market is experiencing signs of life is good news. We are seeing this trend in other nearby suburbs as well, and conclude that more luxury home activity is due to high-end buyers feeling more comfortable about the economy, and sellers being more realistic on the value of their homes.

Overall, Moreland Hills is viewed as one of the area’s most prestigious suburbs with average home values consistently among the highest in the area. Moreland Hills shares an excellent rated school system ( Orange Schools, rated excellent by the state of Ohio ) with neighboring communities of Pepper Pike and Orange, and offers distinctive homes on private wooded lots.

Below are articles of interest pertaining to other suburbs on the East side of Cleveland:

Beachwood Real Estate – First Quarter Market Report 2010

Orange Real Estate – First Quarter Market Report 2010

Pepper Pike Real Estate - First Quarter Market Report 2010

Solon Real Estate – First Quarter Market Report 2010

Twinsburg Real Estate – First Quarter Market Report 2010

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About The Authors:

Dan and Amy Schuman live on the East side of Cleveland and specialize in Cleveland Luxury Homes, working with buyers relocating to Cleveland, and first-time buyers.

For Ohio and Moreland Hills Oh real estate and homes see   Moreland Hills OH real estate

For a personal consultation or to speak directly to The Schuman Team, call 216-346-3235.

VIEW ALL MORELAND HILLS OH HOMES FOR SALE  

CHECK OUT THE SCHUMAN TEAM’S AWARD-WINNING WEBSITE

Moreland Hills Real Estate – Home Value Report 3rd Quarter 2010M is the property of The Schuman Team and may not be duplicated or used without their written consent. ©October,2010