Home prices continue up, but some positive signs for buyers
Figures released Wednesday provide a sliver of hope for buyers that the stratospheric housing market may be returning to earth.
The number of homes for sale continues to slowly rise, offering more options for buyers accustomed to leaping on new listings like cats on mice.
Make no mistake, this is still a sellers’ market, nationally and in Greater Columbus.
The record prices seen for more than a year continued in August, as the median price of a Columbus-area home rose to $275,000, up 13.2% from a year earlier. And homes continue to sell faster than ever: The average home sold here in August went into contract after only four days of being listed, according to Zillow.
Bidding wars also continued to push sales prices beyond asking prices: According to the Columbus Realtors organization, 60% of homes that sold in August sold above their last list price.
But squint closely, and a few signs can be found that the pendulum might be swinging at least a bit toward buyers:
h The number of homes with price reductions is up. According to Zillow, asking prices were reduced on 15.8% of homes listed in Greater Columbus in August, up from 13.1% in July.
h But the big reason for hope: Inventory is slowly rising. Through the first eight months of the year, 28,306 homes were listed for sale in Greater Columbus, up 13.5% from the same period in 2020.
Many of those homes were quickly snatched up with the summer’s record sales, but by the end of August, 3,418 homes were available in the Columbus area, up from 2,748 a year ago.
“Even with record sales last month, the number of homes still available for sale was 24.4 percent higher than last year, providing buyers with even more selection,” said Columbus Realtors President Michael Jones.
Real-estate experts say they expect inventory to continue rising, providing more choices for buyers and easing the competitive pressure on the market.
“We hit the very lows of inventories
in March of this year,” said Selma Hepp, deputy chief economist at the mortgage and real-estate service Corelogic. “Since then, we’ve seen some improvement on inventory, clearly not enough, but a step in the right direction.”
Hepp also noted that there’s growing evidence that some buyers are simply backing out of the market, potentially reducing the competition for homes this fall.
“We’ve had such a competitive environment,” she said. “People are getting fatigued, they’re getting discouraged, maybe because of finances or just because it’s not a good time, so some people are stepping away and competition may be waning in the market.”
While sales in Greater Columbus set another record in August, they dipped nationally, also suggesting that some buyers are growing more cautious.
“Although there was a decline in home purchases, potential buyers are out and about searching, but much more measured about their financial limits, and simply waiting for more inventory,” said Lawrence Yun, chief economist with the National Association of Realtors.
Zillow and National Association of Realtors economists forecast inventory to keep climbing.
“We’re expecting to see inventory continue to increase through next year,” said Nicole Bachaud, an economic data analyst at Zillow. “Inventory will play a significant role in moderating prices for buyers. Having more options will put less competition for houses.”
Bachaud and others acknowledge that the housing market remains a long way from normal, but believe the trends are encouraging for buyers.
“The major demand drivers that have pushed the market to extremes this year are still present,” she said. “We’re moving from a white-hot midsummer to somewhere closer to red hot as we head into the fall.” jweiker@dispatch.com @Jimweiker