Slowed by an ever-declining inventory of houses to even consider, home buyers in Southwest Michigan were essentially forced to take a bit of a breather from the frenetic, record-setting pace of recent months in February, but still managed to surpass the numbers from the same month one year ago.
Southwestern Michigan Association of Realtors Executive Alan Jeffries says, “After a record-breaking start in January, the Southwest Michigan housing market slowed down in February with fewer houses sold and lower selling prices.” However, he adds, “Comparing February 2021 to February of 2020, market numbers were 5- to 63-percent higher. So, for the first two months of this year, the market has outpaced 2020, which we proclaimed to be the new peak year in our year-over-year comparison.”
The number of houses sold in February increased 10-percent to 200 homes from the 181 sold in February of 2020. That number did not set a record in the year-over-year comparison, as the previous high mark for the number of houses sold during a month of February came in at 235 sold in February of 2019.
Despite the numbers, the current 2021 year-to-date figure has set a record at 471 houses sold thus far, representing a 27-percent increase the same point in time in February of 2020, when 371 homes had been sold.
The average selling price last month (February 2021) was $265,892 as compared to $222,938 in February of 2020, for an increase of 19-percent. Year-to-date, the average selling price has jumped 28-percent ($284,092 vs. $221,885). As a result, both the monthly average selling price and the year-to-date average selling price set new record prices in the month of February in the year-over-year comparison.
The median selling price in February 2021 increased 5-percent to $191,000 from $182,500 in February of 2020. Year-to-date, the median selling price has now climbed 13-percent ($195,750 vs. $173,000). The median selling price and year-to-date median selling price also set new record prices in the month of February in year-over-year comparisons.
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 rose 32-percent in February 2021 ($53,178,553 vs. $40,351,946). The year-to-date total dollar volume soared 63-percent ($133,807,728 vs. $82,319,414), leaving both the monthly and year-to-date dollar volumes setting new records in the year-over-year comparison.
The darkest news continues to involve the inventory of houses available for sale, which fell 48-percent to a record low 2.4-months supply at the end of February, with just 629 homes on the market as compared to nearly double that, or 1,201 a year ago. Jeffries says, “This level set an un-welcomed record for buyers.” He adds, “For comparison purposes, in February of 2009, there were 3,099 houses for sale locally.”
The number of bank-owned or foreclosed homes as a percentage of all transactions was 3-percent. The previous low percentage was 6-percent in February of 2019. The highest percentage in any February was 75-percent in 2009.
Locally, the mortgage rate was 2.958 in February, up from 2.891 in January. Last year in February, the rate was 3.438. Nationally, the Freddie Mac mortgage rate in February was 2.97up from 2.73 in January for a 30-year conventional mortgage.
The data in the report reflects home sales across Allegan, Berrien, Cass, and the westerly 2/3rds 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, you should always contact your local Realtor.
Jeffries also shares tips and advice for those buying and selling homes in the region:
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 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 toilet 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 the local area, you can go to http://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 listed above.
