2016 was a very interesting year for real estate. We had an interesting election, record low interest rates, and a significant drop in the number of new homes listed for sale.
In fact, our inventory levels dropped 30% from 2015 to 2016. Why did inventory drop so much? A lot of it has to do with the election. Everyone wanted to wait and see what would happen. Plus, record low interest rates incentivized a lot of homeowners to refinance their homes instead of selling their homes. [su_pullquote][su_icon_text icon=”icon: quote-left” icon_color=”#8ec63d” icon_size=”64″]
2016 was an interesting year for real estate.
Overall for the year, new listings only went up by 1%. The number of closed sales went up just over 6%. That shrinks the amount of inventory that we have. As a result, the average days on market went down 16% from 2015. We only had a 60-day supply of homes on the market, which means that if no new listings came on the market and we continued selling at the same pace, we would run out of homes in 60 days.
Low inventory drove our median sales price up from $215,000 to $230,000, which is a 6% increase. Normally after the holiday season, we see a spike of new listings coming into the market. That hasn’t happened yet this year. New listings continue to decrease, but pending home sales are up. That has reduced the days on market further to 45 days.
As we enter the famous spring selling market, we will see that spike in listings. I expect that the median price will rise a little bit, but not as significantly as last year.
What does this mean for you?
If you are a buyer, interest rates are still at record lows. They have gone up about a half a point since last year but, historically speaking, these are still low interest rates, which makes now a great time to buy a home.
If you are a seller, now is a great time to list your home for sale. Inventory is still low and pending sales are going up. Now is also the perfect time to beat all of the competition you would face in the spring market.
If you have any other questions about our real estate market, give me a call or send me an email. I would be happy to help you!