2022 was an interesting year for real estate. We saw the most mortgage rate hikes in history, but yet we still have a demand for homes and a lack of housing supply. There has been a lot of questioning on how the market will continue to progress, so we wanted to take a moment to review what has happened historically in NW Indiana.

NW Indiana has been a hot spot for growth over the past decade as our neighboring state has pushed people out. We have seen it with the amount of new homes built, the increase in traffic and the stores, restaurants, etc. that have come to the area. The data also shows us drastic increases in homes sold over the last 10 years as well, so let’s start there. Since 2013, let’s look at how many homes have been sold each year.

As we saw the number of buyers flocking out in droves decrease in the latter half of 2022, we were comparing the market to a 2018/2019 market. What we mean by this, is that we could negotiate more, but yet homes were still selling quickly and for great prices.

So while not a completely even market, it was the most even that we have seen it since before the pandemic.

From the chart above, we can see that the total number of properties sold in the MLS was more on track with 2018. While the total residential home sales was down a total of 11.29% across the entire MLS, we can see from the statistics that the average sold price also increased by 9.47% in total. Certain areas had higher increases than others, which we will go through shortly.

The part of this that we wanted to break down a bit more was how many of the homes sold in 2022 in the MLS were new construction homes. We know that land seems to be being bought in the blink of an eye throughout Lake County, especially the further South we go, so how does this translate?

Well of the 11,508 total residential sales in the GNIAR MLS in 2022, 546 or 4.75% of them were new construction homes. This number is up 21.43% from 2021 when only 429 of the 12,807 homes sold were new construction. Imagine now, with how many homes still sold, if you removed 4.75% of the inventory from the MLS. We would likely still be in similar negotiating positions as we were during the pandemic due to the lack of inventory.

Now let’s take a look at the direct numbers of 2022 vs 2021. While total sales were down in the MLS and the number of days on the market also increased by 4 total days, we also saw another increase in the average sales price. In the last 5 years (since 2018), in fact, we have seen an overall increase in residential sales prices to be 30.03% higher in 2022 vs 2018. The key to that statistic shows us that no matter the market, people will always need to buy and sell homes.

As Dave Ramsey says - “The best time to buy a house is now.” (or in reality, 10(ish) years ago). While we are seeing the market a bit slower as we enter into 2023, there are still buyers who are searching for homes and sellers looking to sell their homes at great prices. We know that buyers are being a little pickier (because they can be) than they previously were in 2020- early 2022, but that while interest rates have pushed some out of the market, there are others that are still actively pursuing the dream of home ownership.

Taking another step further in this, we wanted to break down the sales price over the last 10 years. In the graph below, you’ll see listing price and sales price next to each other for each year.

As you can see from the graph, the sold price has pretty consistently been at 95% of list price or higher in this time frame. We know that people have been traveling across the border from IL creating a large influx of buyers throughout the last 10+ years, plus the shortage of homes and low interest rates has also increased the buyers demand for homes.

Moving into 2023, we don’t expect a drastic change in the value of homes. We know that throughout the Region that we are seeing slightly longer market times and we are also seeing builders continue to help with the supply shortage. Builders also create an increase in pricing due to new homes typically selling for more than pre-existing homes in any given area.

We are continuing to see homes sell for more than they have in the past, but we are seeing it a long with negotiation of price, closing costs & inspections. The thing is, even with those items, homes are selling at higher values and in quick time periods. The statistics continue to show us that the correct time to buy a home is NOW and we are here to help you understand the figures of what that looks like. Contact us for a chat about your real estate goals at 630-251-0382.