In Cass County, housing market sales grew while selling prices declined by double-digit percentages for non-waterfront houses, the major number of houses sold.
When we refer to all or overall housing types, we combine results for waterfront and non-waterfront houses. So in total, 43 houses were sold in March 2023 compared to 38 in March 2022, for a 13 percent increase. Separately, waterfront house sales increased by one house (7 vs. 6), and non-waterfront houses rose 16 percent (37 vs. 32).
Year-to-date, overall housing types were up 18 percent (114 vs. 97). Waterfront house sales were up 20 percent (18 vs. 15), and non-waterfront houses jumped 17 percent (96 vs. 82).
In March, the overall average selling price fell 10 percent based on the selling prices of non-waterfront houses compared to March 2022 ($254,992 vs. 283,532). The overall median selling price in March at $185,000 dipped 13 percent from $212,500 in March 2022.
The average selling price for waterfront homes climbed 11 percent to $676,000 from $607,812 in March 2022. The median selling price for waterfront homes soared 76 percent ($740,000 vs. $420,000).
In March, the average selling price for non-waterfront fell 24 percent to $169,234 from $222,730 in March 2022. The median selling price dropped 14 percent to $170,000 from $197,450 in March 2022.
The median price is the price at which 50% of the homes sold were above that price, and 50% were below.
In Cass County, there was one bank-owned or foreclosed home as a part of all closed transactions in March, or 2 percent of total closed transactions. In March 2022, there was also one house. The highest percentage in March previously was 26 percent in 2015.
For comparison, the number of bank-owned or foreclosed homes as a percentage of all transactions in Allegan, Berrien, Cass, and the westerly 2/3 of Van Buren Counties was 3 percent, up from 2 percent in February and the same as in January 2023. The previous lowest percentage was 3 percent in March 2021, and the highest percentage in March was 60 percent in 2009.
The housing market across SWMI picked up steam in March compared to the first two months of the year. However, at the close of the first quarter of 2023, the numbers show that the market’s previous sales frenzy and across-the-board record-setting sales and selling prices have settled to pre-peak years activity.
In March 2023, the number of houses sold fell to 236 from 244 sold in March 2022, for a 3 percent decrease. At the end of the first quarter in 2023, 545 houses were sold, compared to 622 in March 2022, for a 12 percent decline in sales.
The inventory of houses for sale gained 15 percent from a year ago (612 vs. 530), bringing the inventory of houses for sale up to 3.2-months of inventory available for buyers compared to 2.2 months of inventory in March 2022. The current inventory is low for the market area. Looking back at previous years, the market had a 4.9-months supply of houses for sale in March 2020, and going back further in the year-over-year comparison, in March 2010, there were 2969 houses for sale for a 14.7-months supply of houses for buyers.
The average selling price in March 2023 was $321,345 compared to $313,205 in March 2022, for a 3 percent increase. At the end of the first quarter, the average selling price in March 2023 slipped 4 percent from March 2022 ($299,667 vs. $312,013).
The median selling price in March 2023 at $233,500 set the only record as the highest price in the year-over-year comparison that dates back Year-to-date, the median selling price decreased by $1,000 ($219,000 vs. $220,000).
The drop in sales lowered the total dollar volume by just 1 percent in March 2023 ($75,837,608 vs. $76,422,149). The year-to-date total dollar volume dropped 16 percent at the end of the first quarter ($163,318,594 vs. $194,072,341).
The Freddie Mac mortgage rate in March was 6.32, down from 6.50 in February for a 30-year conventional mortgage. A year ago, the rate was 4.67.
When Selling a Home…
As you prepare your tax returns for 2022, be careful not to make any of these eight common tax mistakes, especially when it comes to the property tax deduction or the mortgage interest deduction.
#1 Deducting the Wrong Year for Property Taxes
You take a tax deduction for property tax in the year you (or the holder of your escrow account) actually paid them.
Tip: Taking this deduction requires you to itemize.
#2 Confusing Escrow Amount for Actual Taxes Paid
If your lender escrows funds to pay your property taxes, don’t just deduct the amount escrowed.
#3 Deducting Points Paid to Refinance
In many cases, if you itemize, you can deduct the points you paid your lender to secure your mortgage for the year you bought your home. However, if you pay points in connection with a refinance, you must deduct the points over the life of your new loan.
#4 Misjudging the Home Office Tax Deduction
There are two ways to calculate the home office deduction. One is more complicated and has to be partially recaptured if you turn a profit when you sell your home and can pique the IRS’ interest in your return. But it also can give you a larger deduction than the simpler method.
#5 Failing to Repay the First-Time Homebuyer Tax Credit
If you used the original homebuyer tax credit in 2008, you must repay 1/15th of the credit each year over 15 years.
#6 Failing to Track Home-Related Expenditures
Common tax mistakes are often made by omission: not keeping records. File or scan and store home office and home improvement receipts and other home-related documents as you go.
#7 Forgetting to Report Trackable Capital Gains
If you sold your main home last year, don’t forget to report capital gains on any profit above the excluded amounts. You can typically exclude up to $250,000 of any profits from your income (or up to $500,000 if you’re married filing jointly).
#8 Claiming Too Much for the Mortgage Interest Deduction
If you’re eligible to itemize, the MID loan limit is $750,000. For loans taken out before Dec. 16, 2017, the limit was $1 million. Make sure your loan is grandfathered before claiming the old limit.
Interest paid on home equity loans and second mortgages is deductible, but only if the proceeds of loans were used to buy, build, or improve the home that secures the loan. You can’t deduct interest on home equity loans that were used for things like student loans or cars.
When Buying a Home…
So, you are planning to tour houses for sale. But are you really ready to be a serious buyer? It’s a seller’s market still with a very low inventory of houses for sale. Before you open a door at the seller’s house, you should visit a lender to get pre-approved for a mortgage. This step lets you know how much mortgage you will qualify so you won’t waste time looking at homes you can’t afford.
Do you know what kind of home you want? Make a list of what features in a house are important to you and narrow down the location that would best fit your lifestyle. Next, you need a REALTOR® to help you narrow down the existing listings to what meets your needs and to help you get the intel on new listings as they hit the market. Taking these steps will save you time and help you find the right home with less stress.
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.