ST. JOSEPH — Through the first three months of the year, the Southwest Michigan housing market has remained a hot bed for home sellers.
Alan Jeffries, association executive for the Southwestern Michigan Association of Realtors, said selling prices increased and set new records in the year-over-year comparison dating back to 2006.
“The average selling price from February 2021 to March 2021 increased 26 percent from $265,892 to $335,662,” Jeffries said. “The number of houses sold in February was 200, and in March, 278 houses were sold for a 39 percent increase from one month to the next month.”
In March, the number of houses sold slipped to 278 compared to the 285 sold in March 2020, for a 3 percent decrease.
In the first three months this year, 749 houses have been sold – a new sales record. The previous record was 675 houses, which Jeffries said occurred at the end of the first quarter of 2017.
The inventory of houses for sale dropped 45 percent from a year ago, bringing the inventory of houses for sale down to 2.5 months of inventory available for buyers.
At the end of the first quarter in 2020, the local market had a 4.9-month supply of houses for sale.
Selling prices have set new record levels each month in 2021, Jeffries said.
The average selling price in March 2021 was $335,662, compared to $221,734 in March 2020 – which marked a 51 percent increase.
Year-to-date selling prices at the end of the first quarter also set records in the year-over-year comparison. The year-to-date average selling price in March 2021 increased 37 percent over March 2020 ($303,233 vs. $221,825).
Despite having fewer houses sold, the record-setting selling prices pushed the total dollar volume up 72 percent in March 2021 ($93.3 million vs. $54.1 million). The monthly and year-to-date total dollar volume set new records for the dollar volume at the end of the first quarter ($227.1 million vs. $136.4 million).
Locally, the mortgage rate 3.14, was down from 3.18 in February. Last year in March, the rate was 3.63.
Nationally, the Freddie Mac mortgage rate in March was 3.18, up slightly from 2.97 in February for a 30-year conventional mortgage.
South Haven market
While sales of single-family homes in March dropped somewhat in the South Haven zip code, the average selling price of homes and condos increased by triple digits.
In March, the number of single-family home sales fell 12 percent from March 2020 (15 vs. 17).
Conversely, the average selling price for single-family houses in March 2021 increased 117 percent to $637,070 from $294,071 in March 2020.
Last year there was one condo sold in March. This year there were three condos sold, for a 200 percent increase.
The average selling price for condos plunged 33 percent to $286,217 from $426,583 in March 2020.
In February, there were no bank-owned or foreclosed single-family homes or condos included in the closed transactions in South Haven 49090.
Across the country
According to the National Association of Realtors, existing-home sales fell in March, marking two consecutive months of declines.
The month of March still saw record-high home prices and gains. While each of the four major U.S. regions experienced month-over-month drops, all four areas welcomed year-over-year gains in home sales.
Total existing-home sales decreased 3.7 percent from February to a seasonally-adjusted annual rate of 6.01 million in March. Sales were up 12.3 percent from a year ago.
“Consumers are facing much higher home prices, rising mortgage rates and falling affordability. However, buyers are still active in the market,” said Lawrence Yun, NAR’s chief economist. “The sales for March would have been measurably higher had there been more inventory.”
Although mortgage rates have risen a tick, Yun said they are still at a favorable level and the economic outlook is promising.
“At least half of the adult population has received a COVID-19 vaccination, according to reports, and recent housing starts and job creation data show encouraging dynamics of more supply and strong demand in the housing sector,” Yun said.
The median existing-home price for all housing types in March was $329,100, which was a 17.2 percent increase from March 2020. March’s national price jump marks 109 straight months of year-over-year gains.
Nationally, the total housing inventory at the end of March amounted to 1.07 million units, up 3.9 percent from February’s inventory and down 28.2 percent from one year ago.
Unsold inventory sits at a 2.1-month supply at the current sales pace, marginally up from February’s two-month supply and down from the 3.3-month supply recorded in March 2020.
“Without an increase in supply, the society wealth division will widen with homeowners enjoying sizable equity gains while renters will struggle to become homeowners,” Yun said.