Fredericksburg Texas

The information presented below is complied from data sourced via the Gillespie County Multiple Listing Service.  The tracking historical sales data is grouped into categories that include:  ”Residential”, “Rural Subdivision Lots/Tracts”, Acreage, Farm/Ranch” and “City Lots”.  These categories are further defined by “area” (e.g. in town, out-of-town/county).



While it can be difficult to portrait a true “apples to apples” picture of current real estate sales, the numbers speak for themselves as categorized.  A lot can be read “between the lines” when discussing these figures, if you would like more detailed information on these summary comparisons, feel free to contact me at your convenience.

2^nd Quarter-2009

Residential-City (Fredericksburg, TX) -  The total number of homes sold in the 2nd quarter of 2009 declined 18.3% from sales reported in the 2nd quarter of 2008 (93 in ‘08 and 76 in ‘09). The average price of a sold property declined 25.4% ($280,518 in ‘08 vs. $209,263 in ‘09) and the average number of days-on-market (DOM) has increased an average of 24% (166 in 2nd qtr. 2008 vs. the current 206 days). The total dollar volume of homes sold declined 39.04%. Notably, the average list price to sale price ratio (LP/SP) has decreased from 94.09% in 2008 to the current 93.02%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 15.82%, the average price of sold units has decreased by 25%, the average DOM has increased by 12.43%, the total dollar volume sold has decreased by 43.1% and the average LP/SP ratio has remain statistically unchanged.

The number of units sold registered in the 1^st quarter of 2009 has increased noticeably in the 2nd quarter (44 sold in the 1^st qtr. And 76 sold in the 2^nd).

Residential-County (Gillespie) - The total number of homes (w/acreage) sold in the 2nd quarter of 2009 declined 18.27% from the sales reported in the 2nd quarter of 2008 (93 in ‘08 vs. 76 in ‘09).  The average price of a sold property declined 25.41% ($280,518 in ‘08 vs. $209,236 in ‘09) and the average number of DOM has increased 24.1% (166 in ‘08 to 206 in ‘09).  The total dollar volume of homes sold has declined 39%. Notably, the average list price to sale price ratio (LP/SP) has decreased from 94.09% in 2008 to the current 93.02%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 24.5%, the average price of sold units has decreased by 25%, the average DOM has increased by 12.4%, the total dollar volume sold has decreased by 43% and the average LP/SP ratio has remain statistically unchanged.

The number of units sold registered in the 1^st quarter of 2009 has increased noticeably in the 2nd quarter (44 sold in the 1^st qtr. And 76 sold in the 2^nd).

Lots-City (Fredericksburg, TX) - The total number of lots sold in the 2^nd quarter of 2009 declined 47% from the sales reported in the 2nd quarter of 2008 (17 in ‘08 vs. 9 in ‘09).  The average price of a sold lot declined 7.82% ($62,682 in ‘08 vs. $55,778 in ‘09) and the average DOM has increased 92.94% (241 in ‘08 vs. 465 in ‘09).  The total dollar volume of lots sold has decreased 51.2%. Notably, the average LP/SP ratio has decreased by 7.57%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 64.7%, the average price of sold units has decreased by 34.71%, the average DOM has increased by 48%, the total dollar volume sold has decreased  to the current 91.5%.

The number of units sold registered in the 1^st quarter of 2009 has increased noticeably in the 2nd quarter (3 sold in the 1^st qtr. And 9 sold in the 2^nd).

Rural Subdivision Lots/Tracts - The total number of acreage lots sold in the 2nd quarter of 2009 declined 39.1% (23 in ‘08 vs. 14 in ‘09).  The average price of a sold acreage lot declined 35.3% ($129,405 in ‘08 vs. $83,761 in ‘09) and the average DOM increased by 50%.  The total dollar volume of acreage lots sold decreased 60.60%.  Notably, the average LP/SP ratio has decreased by 3.05%.

Year-to-date (vs. YTD, 2008), total units sold have decreased by 56.86%, the average price of sold units has decreased by 34.83%, the average DOM has increased by 29%, the total dollar volume sold has decreased  by 71.89.

Acreage, Farm/Ranch (All MLS Counties) - The total number of properties categorized as Farm/Ranch sold in the 2nd quarter of 2009 declined 30.95% (42 in ‘08 vs. 29 in ‘09).  Average prices and DOM tend to be less significant in this category as the properties offered and sold vary tremendously. Most notably, total sales volume has decreased by 45.6% from 2nd quarter 2008 vs. 2nd quarter 2009.

Year-to-date (vs. YTD, 2008) the total number of units sold has decreased by 65.9% and the total volume sold has decreased by 62.76%

What do the “greater fool theory”and SUV’s have to do with real estate in Fredericksburg, TX?  These day (unfortunately), plenty!

The greater fool theory holdsthat paying too much for something is o.k. as there will always be a greaterfool willing to pay more. The theory manifests itself in our current marketwhen a seller refuses to lower their price to “market” in the hope that a“greater fool” out there won’t mind overpaying for their particular home.   Of course, that seller (ifsuccessful) becomes a buyer and their logic is immediately reversed when (tothem) everything they see as a new purchase is “overpriced”.

Many of the properties currentlyon the market in Fredericksburg were purchased in the last 5-6 years when themarket could be relied on to appreciate. In many ways, these folks bought at the peak.  The facts and figures of current market conditionsirrefutably tell us we have reached a plateau in sales, pricing, volume,inventory, etc. and some indicators are beginning to decline.  As inventory builds (currently as muchas a 24 month supply in some sectors of the market, equilibrium is generallyagreed to be around 6 month of supply) time on market increases, list price tosales price ratios decrease and downward pressure on pricing builds.

As Fredericksburg tends to be a“discretionary market” (e.g. buyers don’t HAVE to buyer here and (most) sellersdon’t HAVE to sell), we have an impasse. If history is any indication (as we all know it is), a new rule willkick in to break the stalemate…the golden rule.  No, not that one, the more callous one that says “he who hasthe gold makes the rules”.  Inother words,  buyers (who shouldalready have the upper hand, but don’t) who have cash in hand and/orpre-approved financing will soon see more and more sellers willing to “blink”and accept prices more in line with market realities.

SUV’s?  Soaring gas prices has a lot of folks trying to sell SUV’sto replace them with more fuel-efficient alternatives.  The market for SUV’s has been floodedwith inventory that very few folks are willing to buy.  The “value” of SUV’s has plummeted andsales of new units are the worst they’ve been in a decade.  The simple, beautiful and pureprincipals of supply and demand cannot be more clearly evidenced.

My advice (and it’s worth whatyou’re paying for it) to buyers is to be aggressive or wait it out.  Things are definitely going yourway.  You do, however, have toactually ask (make a written offer) for what you want.  All a seller can say is “no”.  To seller’s I advise you to listen toyour agents, read the reams of data they provide you and adjust your expectationsaccordingly. If you elect not to listen, don’t blame the agent for not sellingyour property, the problem lies much closer at hand.

Remember, Experience Matters