Today I want to share a report on the latest trends in our real estate market from the KC Regional Association of Realtors.
As we anticipated at the beginning of the year, demand has remained high for the first three quarters of the year, propping up sales and prices despite heavy reductions in housing inventory across the nation. Rental prices and employment opportunities have climbed consistently year over year, so further housing price increases are probable, but not guaranteed.
Since 2015, pending sales have increased by 4% to 9,800 pending sales in 2016. Closed sales also increased, jumping 2.7% from 10,482 in 2015 to 10,770 for 2016.
Although sales increased, the number of homes for sale actually decreased by 28.4%. There are only 8,089 units available on the market, so we definitely need more inventory.
Sellers will be glad to hear that the median sales price is up 7.6%. In 2015, the median sales price was $172,000; this year, the median sales price is $185,000. These high prices are driven by strong demand and low inventory. The month's supply of inventory is down 31.6%. In fact, this year, there are only 2.6 months of inventory on the market.
The list-to-sales-price ratio went up 1.3% since 2015, so not only can sellers expect higher sales prices, they can also expect to net 96.7% of their asking price.
So, why is demand so high? Generally speaking, today’s demand is driven by three factors:
- Millennials are reaching prime home-buying age.
- Growing families are looking for larger homes.
- Empty-nesters are downsizing.
If you’re a buyer, you can take advantage of the historically low interest rates out there right now. However, those low interest rates cause homeowners to refinance rather than sell, which keeps inventory low. Short-term rentals are also keeping homes on the market, so there is not much out there for buyers to choose from.
If you have any specific questions about buying or selling in today’s very competitive market, just give me a call or send me an email. I would be happy to help you!