At the end of 2020, The housing market in SWMI had celebrated four straight years of peak sales and selling prices. In 2021, the COVID shutdown ended in April. However, homebuyers were not sitting on the sidelines. For the first half of the year, home sales were higher each month than in 2020. Then in July, the shrinking inventory took over, and for the second half of the year sales each month fell below that in 2020.
For most of 2021, sellers saw monthly selling prices rising above prices in 2020. Buyers benefited from lending rates holding fairly steady throughout the year, ranging from 2.73 to 3.18 a Freddie Mac mortgage for a 30-year conventional mortgage.
In December 2021, the number of houses sold was down 19 percent compared to December 2020 (296 vs. 367). Sales in December 2020 at 367 were the highest in the year-over-year comparison dating back to 2006. Year-to-date sales in 2021 came close to the record-setting number of sales in 2020 (3889 vs. 3924).
The average selling in December in 2021 was $377,156, which was 18 percent higher than the average selling price of $318,807 in December 2020, the previous highest selling price. The $377,156 average selling price was also the highest in the year-over-year comparison for December and all of 2021.
The year-to-date average selling price of $325,972 was up 7 percent over 2020 and set a new record in the year-over-year comparison.
The median selling price for December 2021 was $245,000, soaring 19 percent above the $205,500 median selling price for December 2020. The $245,000 median selling price set a new record in the year-over-year comparison and was the highest in all of 2021.
The year-to-date median selling price of $226,100 was a 5 percent increase over $215,000 in 2020 and 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 that the number of houses sold each year has stayed above 3000 for the last nine years. Since 2015, the average selling price in SWMI has increased 63 percent.
The yearly total dollar volume in 2021 increased 6 percent ($1,267,707,045 vs. $1,193,213,037).
The dark cloud over the market is the dwindling inventory of houses for sale, which ranged from a 48 percent drop in February to the lowest drop of 20 percent in September. At the end of 2021, there were just 514 houses for sale compared to 717 in 2020. At 514 houses, the market ended the year with just a 2.0-months supply of homes for sale compared to 2.7 in November and 2.8 in December 2020. The 2.0-months supply inventory level was the lowest in the year-over-year comparison. In 2010, there were 3160 houses on the market or a 15.8-months supply. The number of listings for sale includes homes across Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren counties.
There was one bank-owned or foreclosed home as part of all transactions in December, which was less than 1 percent. In January 2020, the rate was 4 percent, the highest rate for the year. The previous lowest percentage in December was 3 percent in 2020, and the highest percentage in December was 45 percent in 2009.
Nationally in December, the Freddie Mac mortgage rate was 3.11, up from 3.1 in November for a 30-year conventional mortgage.
Looking forward to 2022, “The Real estate market should stay strong in 2022. Low inventory and low interest rates will continue to fuel the real estate prices in Southwest Michigan,” stated Alan Jeffries, Association Executive, Southwestern Michigan Association of REALTORS®, Inc.
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®.
When Selling a Home…
Even in a fast-paced market, setting the selling price of your house can be tricky. To you, your home is filled with memories and the investments you made doing renovations and year-to-year maintenance. To buyers, your home is a house with a bunch of rooms.
Determining the value of your house requires setting aside emotions. Working with a REALTOR® will give you the expertise and local knowledge to advise on how to price your house, so it doesn’t languish on the market.
The most common pitfalls sellers fall into include thinking your house is so great that they list at too high of a price and are passed over during the new listing phase by buyers. The longer your house sits on the market, the less likely you are to get your asking price.
Next, is thinking that your price should include expensive upgrades. Your agent can help you assess the market value of your upgrades and answer the big question.
Finally, pricing your home to make a certain amount of money is the wrong approach. Your REALTOR® will research the market to see what other houses in your area are selling. He also knows the market, the inventory of houses for sale, and how your home compares to others in the area.
When Buying a Home…
Browsing for homes online is exciting. It’s important to take everything you see and read with a grain of salt! Those listings may be attractive, but they might not be giving you the complete picture. That handsome colonial with the light-filled photos? It might be hiding some super icky plumbing problems. That attractively priced condo? It might not actually be for sale or sold.
So set expectations appropriately.
Step one, fill out our home buyer’s worksheet. The worksheet helps you understand what you’re looking to find.
Step two, with that worksheet and knowledge in hand, start browsing for homes. As you do, keep in mind exactly what that tool can, and can’t, do. Here’s how.
Get the latest listings from realtor.com®, which pulls its information every 15 minutes from the Multiple Listing Service (MLS), so listings are more accurate.
The best properties aren’t always the best looking. So while it’s natural to focus on photos, ask your REALTOR® to help you interpret what you find. The best agents have hyper-local knowledge of the market and may even know the details and histories of some properties. If a listing seems too good to be true, your agent will likely know why.
To view properties that are for sale in your local area, go to www.swmar.com and click on “Search”. The Southwestern Michigan Association of REALTORS®, Inc. is a professional trade association for real estate professionals 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.