Single-family home sales in June sank 22% to 231 closed homes due to slumping existing home sales. This is the lowest number of sales for the month of June since 2011. Average home sales for the month of June in the prior ten years have been 307 sales. Existing sales were down 28%, while new construction sales again were up in June by 28% to 36 sales. This is the third month in a row where new construction sales have been up year over year.
Prices continue to increase but at healthier rates compared to 2021 and most of 2022. The Average sold price was up 2% to $350,205, while the median price was up 4% to $310,000. Prices in the City of Columbia continue to be much higher than Boone County’s. The average price in Columbia was $367,814, up 4%, and the median at $327,500, up 7%.
Days on market were up 133% to 21 days. Last June, days on market reached an all-time low of just 9 days. Posting 21 days on market for the month of June is still very low compared to past years, where the average days on market for June from 2011 to 2021 was 46 days.
The months supply of inventory rose to 1.39 months, up 45% from last year, but supply is still below pre-pandemic levels. New listings hitting the market were down compared to the prior three years to 301, but they weren’t too far off from the average of 316 in the last ten years.
Showings of single-family homes in June were up over 12%, with 90% of showings under $499k, and the highest percentage of showings occurred between $150k to $299K.
Pending listings (homes under contract) were a surprise last month, up 5% to 240 listings, but with an increase in showings, this should be expected. This is the first uptick in pending listings since December 2021. What is more surprising is that mortgage rates for the entire month of June were much higher on average than we’ve seen in a while. Hopefully, pending listings will continue to increase as mortgage rates are much more favorable in the last few days.
For the second quarter of 2022, sales were down 22% compared to April, May, & June of last year. The average and median prices were both up 4%. For the first six months of 2023, sales are down 21%, the average price is up almost 5%, and the median was up nearly 6%.
Building permits for single-family residences, especially in the City of Columbia and Ashland, are concerning. Single-family building permits are down 20% in the first six months of the year. Building permits issued by Boone County are up 12% from last year. Permits for Columbia are down 30%, and permits issued by Ashland are down 58% from last year. A decline in building permits doesn’t help our low inventory situation, even more so when new construction home sales in the previous three months have been higher than last year.
According to Mortgage News Daily, the 30-year fixed rate mortgage (30 Yr. FRM) remained relatively high most of June, even after the Federal Government avoided defaulting on its debt by increasing the debt ceiling. However, during the past week, there has been a lot of positive economic data released related to inflation. This has caused equity markets to rise and push the yield on the 10-yr Treasury down, causing mortgage rates to fall, with the 30 Yr. FRM back below 7% after being up to almost 7.25% just a few weeks ago. Many economists still believe the spread between the 10-Yr Treasury rate and the rate of a 30-Yr. FRM is too wide, and they continue to predict rates will be much lower by the 4th quarter of 2023 and will continue to fall in 2024. We’ll have to wait and see if those predictions come true later this year.
Overall, home prices remain resilient as sales continue to slide. An increase in showings and pending listings might indicate that buyers have realized higher mortgage rates are here to stay and are slowly entering the market.
SOURCE – COLUMBIA BOARD OF REALTORS CEO, BRIAN TOOHEY, MBA, RCE, EPRO
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