ST. JOSEPH, MI – “Previously, SWMI experienced a four-year burst of housing sales from 2016 until 2020. Then Covid and a dwindling supply of houses for sale starting in 2021 and through 2022 took its toll on the local housing market. In 2023, sales continued declining reaching the lowest level in ten years. At the end of 2023 housing prices climbed to the highest level on record since 2013.” stated Alan Jeffries, Association Executive, Southwestern Michigan Association of REALTORS®, Inc.
Jeffries continued, “The inventory of houses for sale across Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren Counties at the end of 2023 dropped 4 percent from 2022 (637 vs. 662). At the start of 2023, the inventory had sunk to 3.3-months supply, grew to 4.9-months supply in August and the year ended with 4.0-months supply. For comparison, in 2013, the year started at 9.5-months supply, maxed at 12.6-months supply in June and fell to 8.4-months supply at the end of the year.”
Mortgage rates ranged from 6.13 in January and, at the end of the year, were 6.61. The rate peaked in October at 7.79 for a 30-year conventional mortgage.
The number of houses sold each month in 2023 from January until November was lower than the same month in 2022. Average and median selling prices each month in 2023 were higher than the same month in 2022 for ten months, with exceptions of January and February.
In December 2023, the number of houses sold increased 13 percent compared to December 2022 (188 vs. 167). Year-to-date, sales in 2023 fell 15 percent to 2786 from 3262 in 2022.
The average selling price in December 2023 at $305,580 was 2 percent higher than the average selling price of $299,574in December 2022 The highest selling price in the year-over-year comparison reached $377,156 in 2021.
The year-to-date average selling price of $355,918 climbed 5 percent over 2022 ($338,495) setting a new record in the year-over-year comparison.
The median selling price for December 2023 was $233,501, which grew 7 percent above the $219,000 median selling price for December 2022.
The year-to-date median selling price of $260,000 was a 6 percent increase over $245,000 in 2022 and also set a new record in the year-over-year comparison.
The median price is the price at which 50% of the homes sold were above that price and 50% were below.
Additional market highlights include the number of houses sold each year stayed above 3000 for the last ten years. Then in 2023, the number of houses sold in the year dropped to 2786. Since 2013, the average selling price in SWMI has increased 98 percent ($355,918 vs $179,636).
The yearly total dollar volume in 2023 decreased 11 percent ($977,632,482 vs. $1,104,172,661).
There were eight bank-owned or foreclosed homes as part of all transactions in December 2023, which was 4 percent. This was the highest percentage during 2023. For most of 2023 the percentage was 2 percent.
Nationally:
According to the National Association of Realtors®, existing home sales retreated in December.
Among the four major U.S. regions, sales slipped in the Midwest and South, rose in the West, and were unchanged in the Northeast. All four regions experienced year-over-year sales decreases.
On an annual basis, existing home sales (4.09 million) dropped to the lowest level since 1995, while the median price reached a record high of $389,800 in 2023.
Total existing home sales, which were completed transactions that include single-family homes, townhomes, condominiums, and co-ops, decreased 1.0% from November to a seasonally adjusted annual rate of 3.78 million in December. Year-over-year, sales declined 6.2% (down from 4.03 million in December 2022).
“The latest month’s sales look to be the bottom before inevitably turning higher in the new year,” said NAR Chief Economist Lawrence Yun. “Mortgage rates are meaningfully lower compared to just two months ago, and more inventory is expected to appear on the market in upcoming months.”
The median existing home price for all housing types in December was $382,600, an increase of 4.4% from December 2022 ($366,500). All four U.S. regions posted price increases.
Existing home sales in the Midwest retracted 4.3% from the prior month to an annual rate of 900,000 in December, down 10.9% from last year. The median price in the Midwest was $275,600, up 5.9% from December 2022.
“Despite sluggish home sales, 85 million homeowning households enjoyed further gains in housing wealth,” Yun added. “Obviously, the recent, rapid three-year rise in home prices is unsustainable. If price increases continue at the current pace, the country could accelerate into haves and have-nots. Creating a path towards homeownership for today’s renters is essential. It requires economic and income growth and, most importantly, a steady buildup of home construction.”
First-time buyers accounted for 29% of sales in December, were down from 31% in November 2023 and December 2022. NAR’s 2022 Profile of Home Buyers and Sellers – released in late 2023 – found that the annual share of first-time buyers was 32%.
All-cash sales accounted for 29% of transactions in December, up from 27% in November 2023 and 28% in December 2022.
Individual investors or second-home buyers, who make up many cash sales, purchased 16% of homes in December, down from 18% in November and identical to one year ago.
Total housing inventory at the end of December was 1 million units, down 11.5% from November but up 4.2% from one year ago (960,000). Unsold inventory sits at a 3.2-month supply at the current sales pace, down from 3.5 months in November but up from 2.9 months in December 2022.
The numbers reported for local sales include residential property in Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren Counties. They should not be used to determine the market value of any individual property. If you want to know the market value of your property, please contact your local REALTOR®.
About
The Southwestern Michigan Association of REALTORS®, Inc. is a professional trade association for real estate licensees who are members of the National Association of REALTORS® and ancillary service providers for the real estate industry in Allegan, Berrien, Cass, and Van Buren Counties. The Association can be contacted at 269-983-6375 or through their website at www.swmar.com.
The National Association of Realtors®, “That’s Who We R,” is America’s largest trade association, representing more than 1.4 million members involved in all aspects of the residential and commercial real estate industries.