Written on July 15, 2013 by Sondra TenClay Grandville, MI real estate, Hudsonville MI real estate, Jenison MI real estate, West Michigan real estate, Grand Rapids MI real estate.
A look at the latest figures from the Grand Rapids Association of REALTORS reveals that the trend of rising prices and demand continues along with the struggle for buyers to find adequate inventory.
While our listing inventory Year To Date (YTD) has increased by 4.4% the buyer demand for properties has remained high despite rising interest rates. There has been a slight increase in the # of months of inventory based on pending sales. As of the end of June there was a 3.2 month inventory of available homes based on the pending sales we are experiencing; this up from 2.9 the previous month.
The number of housing units that have closed YTD has increased by 26% and the average home sale price based on closed sales has increased by 2.4% YTD to an average of $148,325. Of interest if that pending sale prices YTD have increased by 26.2% to an average sale price of $151,063.
Remember that we have many micro-markets within the Grand Rapids metro area and some of these have tighter inventory and higher increases in average prices due to the desirability of that market based on a variety of variables. It is always wise to consult a REALTOR who is knowledgeable about the trends for your area of interest.
Trulia just reported that asking prices across the U.S. have jumped dramatically and the increase is accelerating:
Year-Over-Year prices jumped 10.7
Quarter-Over-Quarter prices jumped 4.1% (16.4% annualized)
Month-Over-Month prices jumped 1.5% (18% annualized)
It is important to note that no one really expects prices to really increase at 18% for the year because as prices and interest rates have increased the buyer demand is beginning to decrease and that will likely continue. As an example, if buyers are qualified for a $1000/month mortgage payment and could purchase in the $200,000 range then every 1/2% increase in the interest rate will begin to drop their purchase price limit by approximately $10,000.
Sellers should be very cautious not to overprice their properties despite the positive trends because there is a danger of being passed by buyers who find properties at more appropriate prices. Buyers still remain very price conscious for fear of being upside down in their homes.
If you are considering buying or selling a home get the facts first in order to make an informed decision before you make a move. Give me a call so that we can discuss your situation in greater detail and put local numbers in perspective for you.