11. Housing Values, Market Trends and Rental Rates

11. Housing Values, Market Trends and Rental Rates
An analysis of housing values and sales provides an indication of the strength of a community’s housing market with regard to impacts on the property tax base, the growth in value over time, as well as how sales prices are trending. The supply and demand for housing also affects the affordability of housing within a community. In order to understand the housing market within Conway and the surrounding region, home sales data was analyzed. The three sources of data consulted for this analysis included residential sales provided by Conway’s property assessment records, as well as regional and statewide sales data provided by the New Hampshire Housing Finance Authority and the New Hampshire Association of Realtors.
In terms of the regional housing market, according to the New Hampshire Association of Realtors, 769 homes were sold in the year 2000 within the White Mountain Region[3], which represents an increase of 74% (327 homes) since 1996. It should be noted that this data includes the sales of both existing homes and newly constructed units. Comparatively, the White Mountains Region outperformed the state in terms of existing home sales growth by about 27%. However, it is interesting to note that the North Country Region[4] experienced homes sales growth that outperformed both the State (by 110%) and the White Mountains Region (by 84%). Table 3-10 presents a summary of home sales within the White Mountain and North Country Regions as well as the state of New Hampshire.
As is the case with the growth in home sales, the median sale price of homes has also experienced significant change. Between 1996 and 2000, the median sale price for both new and existing homes in Carroll County increased from $90,000 to $109,900, representing an increase of $19,900 (22%). As illustrated in Figure 3-9, over the same time period the median sale price for homes in Coos County increased from $65,000 to $70,000, representing an increase of $5,000 (8%). The dramatic increase in home sales in the North Country Region/Coos County coupled with the relatively flat sale price growth suggests that this portion of the state is probably an affordable alternative to the White Mountains/Carroll County Region.
Table 3-11 presents a summary of residential sales in Conway between 1996 and 2000, as provided by the town’s assessment records. These sales provide a reliable representation of Conway’s current residential real estate market conditions since only arms-length transactions, (sales that do not include foreclosures, distress sales, sales between relatives or government agencies, etc.) were evaluated. The data indicates that the residential real estate market in Conway has emulated the regional real estate market throughout the late 1990s, with strong growth in the number of units sold (of all types) as well as the average sales price. This strong growth is exhibited in the dramatic increase in the number of single family units sold, from 67 in 1996 to 136 in 2000, representing an increase of 103%. Although the total number of units sold declined slightly between 1999 and 2000, the overall demand for homes in Conway has pushed the average sales price for a single family home
from $83,466 in 1996 to $111,619 in 2000, representing an increase of over $28,000 (34%) over this short timeframe.
Other types of residential dwelling units have experienced growth in both the number of units sold and the average selling price. For example, between 1996 and 2000, the number of condominiums sold has more than doubled from 32 to 79 units, with the average selling price increasing from $68,884 to $81,632 (19%).
Mobile homes (also referred to as manufactured housing) appear to be the affordable housing option in Conway with the average selling price being less than $27,000[5] in 2000. This finding is substantiated by the steady annual increase in the number of manufactured home building permits issued by the town between 1990 and 2000.
Based on an analysis of the arms-length transactions of residentially zoned land in Conway between 1996 and 2000, indications are that the pace of land sales has been increasing. With the exception of 1997, the number of residential acres sold has increased annually with 27 acres sold in 1996 and 102 acres sold in 2000 – representing an increase of 75 acres (274%). An analysis of the weighted average sale price per acre indicates that during the sample period, residential land has been selling at between $3,600 and $16,400 per acre. Discussions with realtors in Conway revealed that prices for buildable lots vary throughout Conway based on location, view, topography, buildable area and infrastructure services available to the parcel. Due to the variety of site factors, prices normally range from $8,000 to $50,000 per acre.
In contrast to the for-sale housing market, readily available information relative to the rental market in Conway is practically non-existent. In order to effectively determine the strength of the residential rental market in Conway, a market study would need to be completed. However, rental market information is available at the regional level. The New Hampshire Housing Finance Authority (NHHFA) prepares an annual rental housing survey[6] which provides a snapshot of the residential rental market at the county and state level. The NHHFA 2001 survey for Carroll County, which was based on a small sample of developments, found that the monthly median gross rents for apartments were as follows: a one bedroom unit, $515; two bedrooms, $703; and, three bedrooms, $936. Between 1990 and 2001, the median gross rent for a two bedroom unit in Carroll County increased by $131 (23%). As indicated in Figure 3-10, median rental rates for two bedroom units in Carroll County have generally
modeled the statewide trend line for median rent. However, median rental rates for two bedroom units in Carroll County are generally between 80% and 90%