RASE August 2023 Housing Market Statistics
Sioux Falls, SD – September 6th, 2023:
Monthly Market Indicators
Higher mortgage rates, along with elevated sales prices and a lack of housing inventory, have continued to impact market activity during the summer homebuying season. The average 30-year fixed-rate mortgage has remained above 6.5% since May, recently hitting a two-decade high in August, according to Freddie Mac. As a result, existing-home sales have continued to slow nationwide, dropping 2.2% month-over-month as of last measure, with sales down 16.6% compared to the same time last year, according to the National Association of REALTORS® (NAR).
New Listings in the Sioux Falls region increased 2.3 percent to 676. Pending Sales were up 20.9 percent to 573. Inventory levels fell 2.1 percent to 1,430 units.
Prices were fairly stable. The Median Sales Price increased 0.5 percent to $311,600. Days on Market was up 4.8 percent to 66 days. Buyers felt empowered as Months Supply of Homes for Sale as up 14.7 percent to 3.9 months.
Falling home sales have done little to cool home prices, however, which have continued to sit at record high levels nationally thanks to a limited supply of homes for sale. According to NAR, here were 1.11 million homes for sale heading into August, 14.6% fewer homes than the same period last year, for a 3.3 months’ supply at the current sales pace. The shortage of homes for sale has boosted competition for available properties and is driving sales prices higher, with NAR reporting a national median existing-home price of $406,700, a 1.9% increase from a year earlier.
Housing Supply Overview
New-home sales recently hit a 17-month high, rising 4.4% month-over month nationally, according to the U.S. Census Bureau. New-home sales were up 31.5% year-over-year, led by gains in the midwest and West, where monthly sales jumped 47.4% and 21.5%, respectively. The newhome market continues to benefit from the lack of existing-home inventory, and with many builders offering sales incentives, including price reductions and mortgage rate buydowns, homebuyers are increasingly turning to new construction for their next home purchase. For the 12-month period spanning September 2022 through August 2023, Pending Sales in the Sioux Falls region were down 14.8 percent overall. The price range with the largest gain in sales was the $800K to $900K range, where they increased 61.9 percent.
The overall Median Sales Price was up 7.1 percent to $300,000. The construction type with the largest price gain was the Previously Owned segment, where prices increased 5.5 percent to $290,000. The price range that tended to sell the quickest was the $200K to $250K range at 59 days; the price range that tended to sell the slowest was the $1M and Above range at 107 days.
Market-wide, inventory levels were down 2.1 percent. The construction type that gained the most inventory was the New Construction segment, where it increased 17.3 percent. That amounts to 3.7 months supply for Single-Family homes and 4.7 months supply for Condos.