Single-family home sales in August were down 10% to 183 units from last year. At the end of May, year-over-year sales were up 10%; however, sales have declined every month since, leaving only a .05% increase for year-to-date sales through August. Sales should continue to drop as pending listings (homes under contract) were also down 23% to 144 pending listings, which will impact sales in the next two or so months. Sales in the City limits of Columbia were down 9%.
Again, August was another month with a decline in sales while also having an increase in prices. The median price in August was up 3% to $325,000, while the average price increased 5% to $373,309.
As the number of sales declined, days on the market grew 29% from last year to 27 days. Days on market vary based on price range. Sold homes priced from $100K to $399,999 posted an average of 17 days on market, while homes above $400k had an average days on market of 46.
Market inventory increased 12% last month to 2.17 months of home inventory supply, which is still below the previous 10 years by 23%. Once more, though, inventory last month varied based on price range. Homes from $100k to $399,999 had an inventory number of 1.56 months, and homes sold above $400K posted inventory of just under four months, which is a little higher than normal for August.
Building permits continue to rebound after being sluggish for most of 2023, with single-family permits up 30% from this time last year. That sounds like a big jump, but permits were down 17% at this time in 2023.
Mortgage rates really couldn’t be much better based on economic conditions. Interest rates for all of August were below 7%, a result of the anticipation of the Federal Reserve lowering the Federal Funds rate. According to Mortgage News Daily, the 30-Yr FRM reached a high of 7.52% in April and is now at 6.15% as of Friday, an 18% decline from the high this past April. To probably many consumers’ surprises, mortgage rates have ticked up slightly since last Wednesday when the Fed announced their Federal Funds rate cut of half a point. This isn’t surprising since Treasury Bond rates dropped so much in anticipation of the Fed’s announcement. Rates are not nearly as low as they were during the pandemic and won’t be unless the Fed starts to buy large amounts of mortgage-backed securities again, which they are currently doing the opposite to shrink their balance sheet to reduce liquidity in the market to help lower inflation.
At the start of this year, many housing economists had predicted a jump in home sales from 2023, but that is looking less likely in our area and nationally. Many still thought mortgage rates would adjust sooner than it occurred, and now we’re eight weeks out from a presidential election, which has impacted the housing market in some years. Nonetheless, higher inventory levels and lower mortgage rates could provide great market conditions for the end of 2024 and the start of 2025.
SOURCE – COLUMBIA BOARD OF REALTORS CEO, BRIAN TOOHEY, MBA, RCE, EPRO
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