September Market Update
What we know about this market currently is that it is unpredictable and this shift is more difficult to predict than past market changes.
So how does that affect you as a buyer or seller?
Well, we wanted to take some time to look at the numbers to understand the trends. We all know that the prices have continued to soar upwards in the past few years in double digit numbers, but have you asked what does a “normal” market actually look like.
Facts of a NORMAL Real Estate Market
6 month supply of inventory
Average of 3% increase in home prices year over hear
What are we seeing in 2022?
Currently today on 9/13/22 we are sitting on 1.88 months supply of inventory in the GNIAR MLS. This is the most we have seen since 2020, which seems like a great spot to be in… but is it?
When looking at RESIDENTIAL SALES ONLY in LAKE COUNTY, IN. from the dates compared of 1/1/21 - 9/9/21 and 1/1/22 - 9/9/22, we have seen an 1.23% increase in the total number of sales. We are still seeing traffic fleeing our neighboring state, so its not a surprise to see that in Lake County this number has not dipped as it has been in trend for the last 10+ years. When comparing that number to the entire MLS (All counties), there is a 1.31% decrease year over year in total sales for the time period. This is more on trend with the news media that the real estate industry is not selling as many homes.
Next let’s take a look at the average sales prices. In the time period for 2021, the average sale price was $240,206. In comparing that to 2022, the average sales price is $268,912, which is 11.95% higher year over year. Remember when looking at this statistic that the average house went under contract 30 days before the closing date, which means all of these homes were under contract in early August. This double digit increase is something that we have seen for the past 2.5 years now. Looking back above for the facts in a normal real estate market we can plainly see that double digit increases are not the norm and the question is coming into play of how long are they sustainable?
Information for Buyers:
Coupling the interest rate increase to hovering around 6% now, with the increase in home prices, gas prices and inflation, you may be thinking who in the right mind is going to buy real estate today? Well the thing is, now is still a great time to purchase (I promise!), and the only part of the reason is that we know that the fall market is always a great one. Why wait until spring when you have the most competition in looking at homes? Right now you have the availability to schedule to see a slew of homes in one day (or multiple) and the you typically have the ability to sleep on your decision… maybe even go back for a 2nd look!
That gives you the OPPORTUNITY TO FIND YOUR PERFECT HOME without settling and with in many instances negotiations happening in the process! This is a fantastic spot for buyers to be in. Plus, we have indications that while interest rates are higher today that there will be some adjustments made in the next few years, which gives you the opportunity to refinance at a lower rate. Also, remember that the average interest rates hover around 6.16% since 1990, so the past several years of the high 2% and low 3% isn’t the norm.
Information for Sellers:
So it’s a great time to purchase with the opportunity to choose your home, negotiate and potentially refinance in the future, but what does that mean for the opposite side for the sellers? Well, remember when we were talking numbers above that the statistics show that year over year we have had a 11.95% increase in sold home prices in Lake County? You’ll be selling your home for a higher price than you could have a year ago, and if you do things right and price conservatively, you’ll end up selling quickly, which gives you the opportunity to also then act as a buyer on your new home purchase. Taking the time to listen and hear what your REALTOR is advising you is key. Ask your REALTOR the hard questions, as we always tell our clients (and many of you may have heard this from us), there are no stupid questions in real estate. If you have the question, I likely have had it too at some point in my journey.
We are suggesting to price your home on the conservative side and let the market do it’s thing. Look at the active comparable homes more closely than what has sold, as those actives are telling the strong story of what homes buyers aren’t willing to purchase or pay that specific price for. We are seeing homes that are over priced just simply sit. While the average time on market of 56 days (currently for our MLS through 9/9/22), may not seem like a long time, when you are sitting there and waiting, it will seem like decades. This is where the supply of inventory comes from and the homes that are priced correctly are still moving quickly. 32 homes went under contract on 9/14/22. If priced correctly, you’ll still sell, sell quickly and sell for the highest price. Facts and data show us that the longer you are on the market for, the lower price you will accept and the less buyers you will have looking at your home. Just check out the graph below.
Make it stand out
Whatever it is, the way you tell your story online can make all the difference.
Paying attention to the market, comparable homes, price changes, etc. is imperative to sell your home for the highest value. Now we do recognize that highest value is not always the thing a seller is looking for, but in our experience it is most of the sellers in the market.
While this market may be a bit wonky and confusing to navigate, there is one thing that reigns true throughout history…. there are buyers and sellers in every market.
NICOLE
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