ST. JOSEPH, MI – “As the chilly temperatures slipped in, the SWMI housing market sales and selling prices continued to chill. In November, the number of houses sold dropped 7 percent from November 2020 and 9 percent from October 2021 (334 vs. 359 and 334 vs. 367, respectively). Since June, the inventory of houses for sale has continued decreasing over 20 percent per month,” stated Alan Jeffries, Association Executive, Southwestern Michigan Association of REALTORS®, Inc.
Jeffries continued, “Year-to-date, the number of houses sold at the end of November was 3593, up 1 percent over November 2020 (3593 vs. 3557). At 3593 houses, November set a new sales record in the year-over-year sales records since 2006., The year-to-date sales have set records over previous years for the last eleven months”.
The average selling price in November dropped 7 percent from the record-setting average selling price in November 2020 ($322,192 vs. $344,901). The year-to-date average selling price in November 2021 set a new record, climbing 6 percent over November 2020 ($321,711 vs. $302,555). Compared to October, the average selling price dropped 4 percent ($321,755 vs. $337,096).
The median selling price in November 2021 stayed even with November 2020 at $220,000. From October 2021, the median price decreased 6 percent ($220,000 vs.$235,000). Year-to-date, the median selling price increased 5 percent ($225,000 vs. $215,000). The year-to-date median selling price set a new record price in the month of November 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.
The inventory of houses for sale fell 25 percent from a year ago (702 vs. 930), bringing the inventory of houses for sale to a 2.7-months supply of inventory available for buyers. For comparison, in November 2010, there were 3160 houses for sale and a 15.8-months supply of inventory. Throughout 2021, the inventory level at the end of each month has fallen 20 percent to 48 percent.
The total dollar volume decreased 13 percent in November 2021 ($107,612,417 vs. $123,819,694). The year-to-date total dollar volume set a new record for the dollar volume at the end of November ($1,156,068,827 vs. $1,076,190,533). The year-to-date total dollar volume rose 7 percent.
There were two bank-owned or foreclosed homes as part of all transactions in November, which was just 1 percent. In January, the rate was 4 percent, the highest rate for the year. The previous lowest percentage in November was 2 percent in 2020, and the highest percentage in November was 36 percent in 2010.
Nationally in November, the Freddie Mac mortgage rate was 3.1, down slightly from 3.14 in October for a 30-year conventional mortgage.
According to the National Association of Realtors®, existing-home sales rose in November, denoting three consecutive months of increases. Three of the four major U.S. regions reported growth in monthly sales, while the fourth region held steady in November. From a year-over-year perspective, only one region experienced a rise in sales as the three others saw home sales decline.
Total existing-home sales, which were completed transactions that include single-family homes, townhomes, condominiums, and co-ops, grew 1.9% from October to a seasonally adjusted annual rate of 6.46 million in November. Sales fell 2.0% from a year ago (6.59 million in November 2020).
“Determined buyers were able to land housing before mortgage rates rise further in the coming months,” said Lawrence Yun, NAR’s chief economist. “Locking in a constant and firm mortgage payment motivated many consumers who grew weary of escalating rents over the last year.”
“Mortgage rates are projected to jump in 2022. However, I don’t expect the imminent increase to be overly dramatic.”
Yun forecasts the 30-year fixed mortgage rate to average at 3.7% by year-end of 2022.
The median existing-home price for all housing types in November was $353,900, up 13.9% from November 2020 ($310,800), as prices increased in each region, with the highest pace of appreciation in the South region. This marks 117 straight months of year-over-year increases, the longest-running streak on record.
“Supply-chain disruptions for building new homes and labor shortages have hindered bringing more inventory to the market,” said Yun. “Therefore, housing prices continue to march higher due to the near-record-low supply levels.”
Yun noted that inflation and the pace of price appreciation are expected to subside next year. Last week, NAR held its third annual Real Estate Forecast Summit, featuring economists and housing experts whose consensus found inflation would likely ease in 2022 at a 4% rate, while home prices are expected to rise at a moderate pace of 5.7%.
Existing-home sales in the Northeast were flat compared to the prior month, neither climbing nor falling in November and recorded an annual rate of 760,000, which is an 11.6% decrease from November 2020. The median price in the Northeast was $372,500, up 4.7% from one year ago.
Existing-home sales in the Midwest ticked up 0.7% to an annual rate of 1,520,000 in November, a 0.7% drop from a year ago. The median price in the Midwest was $260,100, a 9.0% jump from November 2020.
“As the year comes to an end, NAR is very proud of the work we’ve done to protect homeownership and the valuable investments made in our communities and infrastructure,” said NAR President Leslie Rouda Smith, a Realtor® from Plano, Texas, and a broker associate at Dave Perry-Miller Real Estate in Dallas. “We recognize that further efforts are needed and will continue to promote Fair Housing, work to increase the housing shortage, and fight to dismantle discriminatory housing laws and outdated policies.”
First-time buyers accounted for 26% of sales in November, down from 29% in October and from 32% in November 2020 NAR’s 2020 Profile of Home Buyers and Sellers – released in late 2020 – revealed that the annual share of first-time buyers was 34%.
Individual investors or second-home buyers, who make up many cash sales, purchased 15% of homes in November, down from 17% in October and up from 14% in November 2020. All-cash sales accounted for 24% of transactions in November, equal to October’s percentage, and up from 20% from November 2020.
Total housing inventory at the end of November amounted to 1.11 million units, down 9.8% from October and down 13.3% from one year ago (1.28 million). Unsold inventory sits at a 2.1-month supply at the current sales pace, a decline from both the prior month and from one year ago.
According to realtor.com®’s Market Trends Report(link is external), the markets seeing the largest year-over-year growth in newly listed homes include Milwaukee (+17.4%), Charlotte (+16.1%), and Buffalo (+13.5%). Markets still seeing a decline in newly listed homes compared to last year are Hartford (-20.2%), San Francisco (-19.1%), and San Jose (-16.2%).
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®.
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.