February 2022 was a record-setting month with the area’s median price eclipsing $400,000 for the first time in history. The local market continues to be very challenging for buyers and for sellers who don’t have a well-defined next step. FAAR Board Member Michele Freemyers states, “January and February closings numbers were down due to an overall decrease in the number of units sold. Monthly contracts bear the signs of a very difficult buyer’s market, with waivers of financing contingencies, appraisals, and home inspections. Waivers of termite, well and septic inspections are even becoming the norm along with a significant number of cash buyers.”
Sold dollar volume was up in February nearly 10%, jumping from approximately $181 million last February to nearly $200 million this year. The increase in volume was fueled by a more than 17% increase in median sold price, with homes in February of 2022 seeing a median price of $410,000 compared to $349,950 in February of 2021. That is a doubling in median price from 10 years ago. In March of 2012, the median sales price was $195,000, and had increased from just $159,900 ten years before that. The swift pace of price increases is more than many buyers can handle, which led to a year-over-year decrease in units sold this February compared to last year. In February of 2021, 487 houses were transacted compared to 457 this year, a more than 6% drop.
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, increased 44% with houses averaging 23 days on the market in February 2022 compared to the incredibly low 16 days in 2021.
Overall active listings continued to show modest improvement with 23% more homes on the market this February compared to last year, but these are still very low numbers. In February of 2021, there were just 360 homes for buyers to choose from and the market closed this February with 446 homes. For comparison, there were 1,140 homes for sale in February of 2020 and many agents would have said that was not providing adequate choice for a lot of buyers.
Adding to challenges in the market are many of the negotiable terms that are being agreed upon by buyers and sellers. “The other concerning trend is many contracts allow far less than the standard thirty days for settlement,” continued Freemyers. “Often less than twenty-one days are given from ratification to closing, with significant rent back time periods up to sixty days. These shortened timelines put increased stress on the overall transaction, and the participants involved, as many sellers have back-up contracts with higher sales prices, so extensions of settlement dates are unlikely.” All of these challenges are leading to reduced units sold and longer days on market as buyers are balking at the strenuous nature of transactions in the current climate and the steadily increasing prices. New pending contracts were up in February indicating that demand is still high, but overall pendings were down nearly 9% showing that buyers are feeling frustrated and some are pulling back.