Housing Market Continues to Cool Down in SW Michigan

Each month, MoodyOnTheMarket.com brings you an exclusive ‘first look’ at residential real estate trends from the Southwestern Michigan Association of Realtors.  Here is that update as of the end of March:

At the end of the first quarter of 2022, the local housing market has slowed down from the robust new sales records in the year-over-year comparison that looks back to 2006. The average selling price from February 2022 to March 2022 decreased 3 percent from $324,027 to $313,205.  The number of houses sold in February was 168, and in March, 244 houses were sold for a 45 percent increase from one month to the next.

In March, the number of houses sold slipped to 244 from 278 sold in March 2021, for a 12 percent decrease.  At the end of the first quarter in  2021, 749 houses were sold, the current sales record, compared to 622 in March 2022 for a 17 percent decline in sales.

The inventory of houses for sale dropped 20 percent from a year ago (530 vs. 665), bringing the inventory of houses for sale down to 2.2-months of inventory available for buyers and down from 2.5 months of inventory in March 2021. At the end of the first quarter in 2020, the market had a 4.9-months supply of houses for sale. For comparison, in March 2009, there were 2969 houses for sale.

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Selling prices may be starting to adjust.  The average selling price in March 2022 was $313,205 compared to $335,662 in March 2021, for a 7 percent decrease.  At the end of the first quarter, year-to-date selling prices set records in the year-over-year comparison. The year-to-date average selling price in March 2022 increased 3 percent over March 2021 ($312,013 vs. $303,233 ).

The median selling price in March 2022 increased 10 percent to $223,700 from $202,875 in March 2021.  Year-to-date, the median selling price rose 11 percent ($220,000 vs. $198,000). The median selling price and year-to-date median selling price also set new record prices in the month of March in the year-over-year comparison.

The median price is the price at which 50% of the homes sold were above that price, and 50% were below.

The record-setting selling prices were not enough to keep the total dollar volume from sinking 18 percent in March 2022 ($76,422,149 vs. $93,314,197). The year-to-date total dollar volume dropped 15 percent at the end of the first quarter ($194,072,341 vs. $227,114,925).

The number of bank-owned or foreclosed homes as a percentage of all transactions was 2 percent, down from 3 percent in February. In January, the rate was 0 percent. The previous lowest percentage was 3 percent in March 2021, and the highest percentage in March was 60 percent in 2009.

Nationally, in March, the Freddie Mac mortgage rate was 4.67, up from 3.89 in February for a 30-year conventional mortgage.

This data reflects home sales across Allegan, Berrien, Cass, and the westerly 2/3 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®.