“As the temperatures cooled off, the Southwest Michigan local housing market continued to cool also. We have now experienced eleven consecutive months in 2022 where home sales have declined when compared to the same month in 2021. Sales in November dropped 19 percent from sales in October 2022 (277 vs. 340). Selling prices increased modestly. The bright spot in November was that the Freddie Mac mortgage rate decreased to 6.49 from 7.08 in October,” stated Alan Jeffries, Association Executive, Southwestern Michigan Association of REALTORS®, Inc.
Jeffries continued, “In November, the number of houses sold fell to 277 from 334 in November 2021, for a 17 percent drop in sales. Year-to-date sales were down 14 percent from 2021 (3095 vs. 3593).”
“The Freddie Mac mortgage rate slid to 6.49 from 7.08 in October for a 30-year conventional mortgage. A year ago, the rate was 3.10,” Jeffries stated.
The median selling price in November and the year-to-date average and median selling prices set records in the year-over-year comparison, which dates back to 2006.
The average selling price rose 3 percent from that in November 2021 ($331,848 vs. $322,192). The year-to-date average selling price of $340,595 was 6 percent higher than the $321,755 price in November 2021.
The median selling price increased 2 percent to $224,900 from $220,000 in November 2021. Year-to-date, the median selling price grew 9 percent ($245,001 vs. $225,000).
The median price is the price at which 50% of the homes sold were above that price and 50% were below.
The housing inventory available for sale across Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren Counties was 769 at the end of November, down from 873 in October but up from 702 in November 2021. The inventory showed two months of growth. However, the availability level dropped from a 4.1-months supply of homes for sale at the end of October 2022 to a 3.7-months supply at the end of November 2022. For comparison, in November 2010, there were 3160 houses for sale and a 15.8-months supply of inventory.
The lower sales and lower selling prices resulted in the total dollar volume falling 15 percent in November 2022 from November 2021 ($91,922,130 vs. $107,612,417). Year-to-date total dollar volume at the end of November 2022 dropped 9 percent ($1,054,144,196 vs. $1,156,068,827).
Only one bank-owned or foreclosed house was included as a percentage of all transactions. This resulted in the percentage of all transactions falling to 0 percent again after the jump to 3 percent in October. The previous lowest percentage in November was 1 percent in 2021. The highest percentage in November was 36 percent in 2010.
According to the National Association of Realtors®, – Existing home sales declined for the tenth month in a row in November. All four major U.S. regions recorded month-over-month and year-over-year declines.
Total existing-home sales, which were completed transactions that include single-family homes, townhomes, condominiums, and co-ops, – waned 7.7% from October to a seasonally adjusted annual rate of 4.09 million in November. Year-over-year, sales dwindled by 35.4% (down from 6.33 million in November 2021).
“In essence, the residential real estate market was frozen in November, resembling the sales activity seen during the COVID-19 economic lockdowns in 2020,” said NAR Chief Economist Lawrence Yun. ‘The principal factor was the rapid increase in mortgage rates, which hurt housing affordability and reduced incentives for homeowners to list their homes. Plus, available housing inventory remains near historic lows.”
The median existing-home price for all housing types in November was $370,700, an increase of 3.5% from November 2021 ($358,200), as prices rose in all regions. This marks 129 consecutive months of year-over-year increases, the longest-running streak on record.
Existing-home sales in the Northeast decreased 7.0% from October to an annual rate of 530,000 in November, down 28.4% from November 2021. The median price in the Northeast was $394,700, an increase of 3.5% from the prior year.
Existing-home sales in the Midwest retreated 5.6% from the previous month to an annual rate of 1.02 million in November, falling 30.6% from one year ago. The median price in the Midwest was $268,600, up 3.9% from November 2021.
First-time buyers were responsible for 28% of sales in November, which was unchanged from October but up from 26% in November 2021. NAR’s 2022 Profile of Home Buyers and Sellers – released last month – found that the annual share of first-time buyers was 26%, the lowest since NAR began tracking the data.
All-cash sales accounted for 26% of transactions in November – identical to October and up from 24% in November 2021.
Individual investors or second-home buyers, who make up many cash sales, purchased 14% of homes in November, down from 16% in October and 15% in November 2021.
“The market may be thawing since mortgage rates have fallen for five straight weeks,” Yun added. “The average monthly mortgage payment is now almost $200 less than it was several weeks ago when interest rates reached their peak for this year.”, Yun said.
Nationally, the total housing inventory registered at the end of November was 1.14 million units, which was down 6.6% from October but up 2.7% from one year ago (1.11 million). Unsold inventory sits at a 3.3-month supply at the current sales pace, which was identical to October, but up from 2.1 months in November 2021.
Realtor.com®‘s Market Trends Report in November shows that the largest year-over-year median list price growth occurred in Milwaukee (+38.1%), Memphis (+26.9%), and Miami (+24.8%). Phoenix reported the highest increase in the share of homes that had prices reduced compared to last year (+28.4 percentage points), followed by Austin (+23.8 percentage points) and Denver (+21.0 percentage points).
“For most of this year, prospective home buyers have faced the dual challenges of elevated mortgage rates and limited housing inventory,” said NAR President Kenny Parcell, a REALTOR® from Spanish Fork, Utah, and broker-owner of Equity Real Estate Utah. “Consumers can rely on REALTORS® to provide informed guidance on changing market conditions and trusted expertise throughout all steps of the home buying process.”
The numbers reported for local sales include residential property in Allegan, Berrien, Cass, and the westerly two-thirds 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.