September Existing Home Sales Drop 2% While Prices Increase in SWMI.
ST. JOSEPH, MI – “So far this year the Southwestern Michigan housing market has continued to witness fewer home sales with home selling prices climbing. The declining inventory of houses for sale has been the key factor. Buyers across Berrien, Cass and the westerly 2/3 of Van Buren counties have been searching for houses from an inventory that has dropped 34 percent in the last five years,” stated Alan Jeffries, Association Executive, Southwestern Michigan Association of REALTORS®, Inc.
“The number of houses sold in September 2018 was down 2 percent from
September 2017 (360 vs. 367). Year-to-date, the number of houses sold was down 3 percent (2,732 vs. 2,813),” said Jeffries.
“The September 2018 average selling price decreased 3 percent to $245,447 from
$252,211 in September 2017. However, the year-to-date, average selling price rose to a record selling price of $230,546 from the past record average selling price of $215,154 in September 2017 for a 7 percent increase,” continued Jeffries
The median selling price increased 8 percent in September 2018 ($172,000 vs. $159,550). Year-to-date the median selling price was up 5 percent ($162,000 vs.$155,000). Both the monthly and year-to-date median selling prices were the highest in the year-over-year comparison since 2006.
The median price is the price at which 50% of the homes sold were above that price and 50% were below.
Fewer home sales lowered total dollar volume 6 percent over September 2017 ($88,361,176 vs. $93,533,403). Year-to-date, total dollar volume was record setting and was up 4 percent from September 2017 ($629,853,828 vs. $605,229,929).
Inventory of houses for sale decreased 3 percent from a year ago (1886 vs. 1954). At the end of September there was 6.2-months supply of houses for sale; down slightly from 6.3-months supply at the end of September 2017. In September 2010 the inventory of houses for sale was 3574 or 17.3-months supply.
The number of bank-owned or foreclosed homes as a percentage of all transactions in September fell to 4 percent from 6 percent in August; matching the same percentage set in July. This is the lowest percentage in 2018. The highest percentage in September was 37 percent in 2009.
Locally, the mortgage rate increased to 4.827 from 4.625 in August. Last year in September, the rate was 3.93. Nationally, the Freddie Mac mortgage rate in September was 4.72 up slightly from 4.52 in August for a 30-year conventional mortgage.
Nationally –
According to the National Association of Realtors®, – – Existing-home sales declined in September after a month of stagnation in August. All four major regions saw no gain in sales activity last month.
Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, fell 3.4 percent from August to a seasonally adjusted rate of 5.15 million in September. Sales are now down 4.1 percent from a year ago (5.37 million in September 2017).
Lawrence Yun, NAR chief economist, says rising interest rates have led to a decline in sales across all regions of the country. “This is the lowest existing home sales level since November 2015,” he said. “A decade’s high mortgage rates are preventing consumers from making quick decisions on home purchases. All the while, affordable home listings remain low, continuing to spur underperforming sales activity across the country.”
The median existing-home price for all housing types in September was $258,100, up 4.2 percent from September 2017 ($247,600). September’s price increase marks the 79th straight month of year-over-year gains.
Regionally, existing-home sales in the Midwest remained the same as last month at an annual rate of 1.28 million in September, but are still down 1.5 percent from a year ago. The median price in the Midwest was $200,200, up 1.9 percent from last year.
First-time buyers were 32 percent of sales in September, up from last month (31 percent) and up a year ago (29 percent). NAR’s 2017 Profile of Home Buyers and Sellers revealed that the annual share of first-time buyers was 34 percent.
All-cash sales accounted for 21 percent of transactions in September, up from July and a year ago (both 20 percent). Individual investors, who account for many cash sales, purchased 13 percent of homes in August, unchanged from July and down from 15 percent a year ago.
Nationally, the total housing inventory at the end of September decreased from 1.91 million in August to 1.88 million existing homes available for sale, and is up from 1.86 million a year ago. Unsold inventory is at a 4.4-month supply at the current sales pace, up from 4.3 last month and 4.2 months a year ago.
“There is a clear shift in the market with another month of rising inventory on a year over year basis, though seasonal factors are leading to a third straight month of declining inventory,” said Yun. “Homes will take a bit longer to sell compared to the super-heated fast pace seen earlier this year.”
“Rising interests rates coupled with increasing home prices are keeping first-time buyers out of the market, but consistent job gains could allow more Americans to enter the market with a steady and measurable rise in inventory,” says Yun.
“Despite small month over month increases, the share of first-time buyers in the market continues to underwhelm because there are simply not enough listings in their price range,” said NAR President Elizabeth Mendenhall, a sixth-generation Realtor® from Columbia, Missouri and CEO of RE/MAX Boone Realty. “Entry-level homes remain highly sought after, as prospective buyers are advised to contact a Realtor® as early in the buying process as possible in order to ensure buyers can act fast on listings that catch their eye.”
The numbers reported for local sales include residential property in Berrien, Cass and the westerly 2/3 of Van Buren counties and should not be used to determine the market value of any individual property. If you want to know the market value of your property, please contact your local REALTOR®.
About
The Southwestern Michigan Association of REALTORS®, Inc. is a professional trade association for real estate licensees who are members of the National Association of REALTORS® and ancillary service providers for the real estate industry in Van Buren, Berrien and Cass Counties. The Association can be contacted at 269-983-6375 or through their website at www.swmar.com
The National Association of Realtors®, “The Voice for Real Estate,” is America’s largest trade association, representing more than 1.3 million members involved in all aspects of the residential and commercial real estate industries.
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