“The September 2020 SWMI housing market results were jaw-dropping and history-making. First and foremost, 518 houses were sold and closed, which was the highest number in local history in any month going back to January 2005. Previously in peak years, the number of sales reached the low 400 sales range. This year July (479), August (455), and September sales were off the charts, bringing year-to-date sales back to within 1 percent of 2019 after three months of shutdown earlier in the year,” stated Alan Jeffries, Association Executive, Southwestern Michigan Association of REALTORS®, Inc.
Jeffries continued, “The inventory of houses for sale took a big hit, dropping 31 percent or 664 houses from a year ago (1156 vs. 1820). The market at the end of September had a 5.0-months supply of houses for sale. For comparison, in September 2010, there were 3574 houses for sale. The number of listings for sale includes homes for sale across Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren counties.”
The number of houses sold in September was 49 percent higher than in September 2019 (518 vs. 348). Year-to-date, the number of houses sold was down to 2721 from 2731 sold in September 2019.
Average, median, and year-to-date selling prices powered escalated to new record prices in our year-over-year comparison for September prices.
The average selling price at $316,525 was 31 percent higher than the $241,620 average selling price in September 2019. The year-to-date, average selling price increased 21 percent ($287,218 vs. $237,390).
The median selling price climbed to $220,000 from $193,500 in September 2019 for a 14 percent increase. Year-to-date, the median selling price rose 18 percent ($210,000 vs. $177,500).
The median price is the price at which 50% of the homes sold were above that price, and 50% were below.
With the record-setting number of sales and selling prices, the total dollar volume sky-rocketed 95 percent in September ($163,960,120 vs. $84,083,825). The year-to-date total dollar volume increased 21 percent ($781,521,082 vs. $648,313,723).
For the last four months, the number of bank-owned or foreclosed homes as a percentage of all transactions has held steady at 1 percent. This was the lowest percentage reached since 2009. The highest percentage in previously in September was 37 percent in 2009.
Locally, the mortgage rate was 3.113, up slightly from 3.104 in August. Last year in September, the rate was 3.786. Nationally, the Freddie Mac mortgage rate in September was 2.88 down from 2.91 in August for a 30-year conventional mortgage.
According to the National Association of Realtors®, – Existing-home sales grew for the fourth consecutive month in September. Each of the four major regions witnessed month-over-month and year-over-year growth, with the Northeast seeing the highest climb in both categories.
Total existing-home sales, which were completed transactions that include single-family homes, townhomes, condominiums, and co-ops, rose 9.4% from August to a seasonally-adjusted annual rate of 6.54 million in September. Overall sales rose year-over-year, up 20.9% from a year ago (5.41 million in September 2019).
“Home sales traditionally taper off toward the end of the year, but in September they surged beyond what we normally see during this season,” said Lawrence Yun, NAR’s chief economist. “I would attribute this jump to record-low interest rates and an abundance of buyers in the marketplace, including buyers of vacation homes given the greater flexibility to work from home.”
The median existing-home price for all housing types in September was $311,800, up 14.8% from September 2019 ($271,500), as prices rose in every region. September’s national price increase marks 103 straight months of year-over-year gains.
For four straight months, home sales have grown in every region compared to the previous month. Median home prices increased at double-digit rates in each of the four major regions from one year ago.
Existing-home sales grew 7.1% in the Midwest to an annual rate of 1,510,000 in September, up 19.8% from a year ago. The median price in the Midwest was $243,100, a 14.8% increase from September 2019.
First-time buyers were responsible for 31% of sales in September, down from 33% in August 2020 and September 2019. NAR’s 2019 Profile of Home Buyers and Sellers – released in late 2019 – revealed that the annual share of first-time buyers was 33%.
Individual investors or second-home buyers, who account for many cash sales, purchased 12% of homes in September, a small decline from the 14% figure recorded in both August 2020 and September 2019. All-cash sales accounted for 18% of transactions in September, unchanged from August but up from 17% in September 2019.
Nationally, the total housing inventory at the end of September totaled 1.47 million units, down 1.3% from August and down 19.2% from one year ago (1.82 million). Unsold inventory sits at a 2.7-month supply at the current sales pace, down from 3.0 months in August and down from the 4.0-month figure recorded in September 2019.
“There is no shortage of hopeful, potential buyers, but inventory is historically low,” Yun said. “To their credit, we have seen some homebuilders move to ramp up supply, but a need for even more production still exists.”
Sales in vacation destination counties have seen a strong acceleration since July, with a 34% year-over-year gain in September.
“The uncertainty about when the pandemic will end coupled with the ability to work from home appears to have boosted sales in summer resort regions, including Lake Tahoe, mid-Atlantic beaches (Rehoboth Beach, Myrtle Beach), and the Jersey shore areas,” Yun said.
Additionally, a recent NAR study confirms that many Americans continue to seek new living situations due to the coronavirus pandemic.
The numbers reported for local sales include residential property in Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren counties and 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, Van Buren, 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 1,401,418 million members involved in all aspects of the residential and commercial real estate industries.