Just two months ago, we were trying to catch our breath after the wild record-breaking River Oaks real estate ride of 2018.
As we wrote in the River Oaks Market Report ~ 2019 Outlook, 2018 was memorable for the sheer volume of transactions: “more than $300 million of real estate traded hands in River Oaks, even more than in the previous record year 2015 ($290 million), after which the market started putting on the brakes in 2016 ($250 million) and dithering in 2017 ($200 million).”
Ten weeks into 2019, however, it’s impossible to ignore the contrast of the current market, segments of which have yet to wake up from their Christmas/New Year holiday slumber.
In River Oaks, it’s currently a slow market with a high level of inventory, but an acute shortage of buyers. If there’s been a trend so far for new contracts in the neighborhood, it is that buyers are picking up properties on larger lots in excellent locations while they can. Noted:
- Seven out of the 10 new contracts since January 1 were for properties with lot sizes of a half-acre or more.
- None of the new contracts were for new/recent construction on smaller lots (less than 13,000 square feet).
- One contract was for incomplete new construction on a half-acre priced at close to $9 million.
- Two contracts were for older homes that had been significantly remodeled and were on a half-acre.
- Two contracts were outright lot purchases, each about half an acre.
- Two contracts were for houses on half an acre or more needing significant remodeling.
- Two contracts were for recently remodeled houses on medium-sized lots (approximately 15,000 square feet).
- There was just one outlier at mid-March 2019: a large, dated 15-year-old house on a small lot in a middling location.
This doesn’t mean that it’s going to be big lots all the way for 2019: There are just so many to go around and a limited number of buyers with the means to snag them.
But it is the confident buyers with deep pockets who most often move quickly in any given year.
The more cautious sectors of the market will likely take over from the start of Spring, providing some renewed activity for the mid-sector (properties priced between $2 million and $4 million), which had a strong finish to 2018. We hope to also see a bump up for the entry-level (properties priced at less than $2 million), which has not had a new contract since the start of 2019.