The frenetic real estate market of the last 14 months seems to show signs of slowing down just a bit. “Maybe it was the hazy, hot and humid days or the influx of sellers hoping to capture the “hot” market, or maybe it was buyers who decided this sellers’ market wasn’t for them. Whatever it was, things are seeming to slow down a bit and start to balance,” states 2021 FAAR President Carrie Danko. “I am seeing homes on the market for longer periods of time, prices more consistent with market value, and a decrease in multiple offers.”
While July posted very robust market numbers, there are continuing signs that the pace of business may be cooling. Sold dollar volume was up nearly 18%, coming in approximately $377.8 million in July of 2021 compared to $320.4 million last year. The increase was fueled by a nearly 12% jump in median price going from $349,000 in July of 2020 up $51,000 to $390,000 in July of this year. There was also a nearly 7% year-over-year increase in units sold with 907 properties changing hands in July compared to 849 last year.
Days on market, the time it takes from when a listing enters the market until it receives a ratified contract and is removed from active status on the multiple listing service, fell 63% with houses averaging just 11 days on the market in July 2021 compared to 30 days in July 2020.
For the first time in 2 years, the local real estate market has more homes for sale in a given month than the previous year. July of 2021 saw about 3% more homes for sale than the previous year, but we’re still talking about historically very low inventory. There were 740 homes for sale in July of 2020 and there are now 764 homes for sale. The last time we saw more homes in July than the previous year was 2019, when inventory was 0.1% higher than the previous year and there were 1,749 homes for sale. Since January of 2020, the market has experienced double digit year-over-year declines in active listings. While up for July of 2021, active listings are still significantly lower than the 5-year average of 1,337 homes on the market.
There is more good news in new listings, with July yet again beating the 5-year average of properties coming onto the market, with a nearly 20% increase from last July. In 2020, 854 new properties came onto to the market compared to the 5-year average of 909 and the July 2021 number of 1,020. New pending contracts, which indicates the pace of transactions, is holding steady at a modest year-over-year increase at 4%, with 883 new homes under contract. The market over the last year regularly saw double digit increases in new pendings with some months posting 30% or 40% increases.
Many Realtors® are celebrating the cooling market as a needed step towards more predictability in the process and more buyers being able to find a home that suits their needs. The super-charged competition and multiple offer situations of the market in recent months turned many buyers off and made it very difficult for moderate- and lower-income buyers to take advantage of the generational wealth creation benefits of homeownership. “It will be interesting to see what happens in the months to come but one thing is for sure…it’s still a great time to sell and a great time to buy with the still historically low interest rates,” concludes Danko.