Southwest Michigan’s housing market is adjusting to an extremely low inventory of houses for sale. The number of houses sold in February dropped 16 percent from February 2021(168 vs. 200) and 20 percent from January 2022 sales of 210. The level of sales in February was the lowest since February 2014.
So, for the first two months of this year, the market was down 20 percent, with sales at 378 compared to 471 in February 2021which was the highest year-to-date sales in our year-over-year comparison.
The inventory of houses for sale fell 24 percent to a record low 2.0-months supply at the end of February (480 vs. 629). This level set an unwelcomed record for buyers searching listings for sale across Allegan, Berrien, Cass, and the westerly two-thirds of Van Buren counties. For comparison, in February 2009, there were 3099 houses for sale.
The average and median selling price in February 2022 and year-to-date selling prices soared double digits to set new record prices in the year-over-year comparison that dates back to 2006.
In February, the average selling price was $324,027 compared to $265,892 in February 2021, up 22 percent. Year-to-date, the average selling price jumped 10 percent ($311,243 vs. $284,092).
The median selling price in February 2022 increased 18 percent to $224,450 from $191,000 in February 2021. Year-to-date, the median selling price also climbed 10 percent ($215,000 vs. $195,750).
The median price is the price at which 50% of the homes sold were above that price, and 50% were below.
The total dollar volume increased 2 percent in February 2022 ($54.436,579 vs. $53,178,553). The year-to-date total dollar volume fell 12 percent ($117,650,192 vs. $133,807,728).
The number of bank-owned or foreclosed homes as a percentage of all transactions was 3 percent (3 houses) and previous low percentage was 6 percent in February 2019. The highest percentage in February was 75 percent in 2009.
The Freddie Mac mortgage rate in February was 3.89, up from 3.55 in January for a 30-year conventional mortgage. A year ago, the rate was 2.97.
This data reflects home sales across Allegan, Berrien, Cass, and the westerly two-thirds 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®.
When Selling a Home…
With the extremely low inventory of houses for sale, you might be wondering if this is a good time to put your house on the market. But you have a lot of questions. What if my house sells before I find a house to buy? How much is my house worth? What happens when someone makes a lousy offer? When considering making this important financial change in your life, you need to seek advice from someone you can trust to look at the whole picture with you. REALTORS® are professionally trained, have the marketing information to guide decision making, and have the pulse of what buyers’ and sellers’ actions or reactions are in the local market. With the many steps in the selling and buying stages, not to mention the emotions involved, working with a REALTOR® gives you peace of mind that all your questions will be answered and that the advice you receive will protect your financial investment.
When Buying a Home…
If you’re considering ditching the landlord for a mortgage, there are things you need to know that’ll help you figure out if you’re ready.
Your down payment may not be the biggest hurdle. A healthy credit history is important. Most borrowers will start to qualify for a mortgage with a minimum score of 620. The most competitive interest rates will be offered to those with a score of 700 or above.
You probably will have to compromise. You may start with your dream home in mind, but find that what you can afford may not be in the greatest neighborhood or have that big yard for the kids.
Be emotionally ready for financial surprises. Homeownership is more hands-on. If the bathroom breaks, you pay to have it fixed or invest in tools to do it yourself.
A mortgage can be cheaper than rent. An added incentive is that your payment will stay the same while a landlord can raise your rent. The real financial advantage is that you are building equity in your home instead of lining your landlord’s pockets.
Meeting with a REALTOR® can help you gain an unbiased perspective both financially and emotionally before taking this life-changing step.
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.