Monthly RASE MLS Statistics
RASE August 2018 Housing Market Statistical Reporting
Sioux Falls, SD – Sept 7, 2018:
Monthly Market Indicators
Rising home prices, higher interest rates and increased building material costs have pressured housing affordability to a ten-year low, according to the National Association of Home Builders. Keen market observers have been watching this situation take shape for quite some time. Nationally, median household income has risen 2.6% in the last 12 months, while home prices are up 6.0%. That kind of gap will eventually create fewer sales due to affordability concerns, which is happening in several markets, especially in the middle to high-middle price ranges.
New Listings in the Sioux Falls region decreased 7.7 percent to 644. Pending Sales were up 22.8 percent to 641. Inventory levels fell 20.2 percent to 1,457 units.
Prices continued to gain traction. The Median Sales Price increased 2.6 percent to $199,900. Days on Market was down 2.5 percent to 77 days. Sellers were encouraged as Months Supply of Homes for Sale was down 23.9 percent to 3.5 months.
While some are starting to look for recessionary signs like fewer sales, dropping prices and even foreclosures, others are taking a more cautious and research based approached to their predictions. The fact remains that the trends do not yet support a dramatic shift away from what has been experienced over the last several years. Housing starts are performing admirably if not excitingly, prices are still inching upward, supply remains low and consumers are optimistic. The U.S. economy is under scrutiny but certainly not deteriorating.
Housing Supply Overview
The potential of an affordability conundrum has veered into the national spotlight, as household wages struggle to keep pace with home price increases. Yet it is ill-advised to predict a heavy shift toward fewer sales and lower prices. Consumers have learned a lot in the last decade. For the 12-month period spanning September 2017 through August 2018, Pending Sales in the Sioux Falls region were up 5.5 percent overall. The price range with the largest gain in sales was the $600K to $700K range, where they increased 78.6 percent.
The overall Median Sales Price was up 6.6 percent to $199,900. The construction type with the largest price gain was the Previously Owned segment, where prices increased 5.2 percent to $192,475. The price range that tended to sell the quickest was the $100K to $150K range at 70 days; the price range that tended to sell the slowest was the $1M and Above range at 199 days.
Market-wide, inventory levels were down 20.2 percent. The construction type that lost the least inventory was the Previously Owned segment, where it decreased 16.6 percent. That amounts to 3.4 months supply for Single-Family homes and 4.0 months supply for Condos.