Our Current Housing Market Explained
Here’s what you need to know about our local housing market.
How is our local real estate market finishing out 2022? Believe it or not, 2022 is almost in our rearview mirrors, and the real estate market has started slowing down. If you've been watching the national headlines, it's a bit deceiving. The Midwest and Indiana are much different than the national real estate market.
Some other markets, like Idaho, Utah, and some of the coastal cities, saw crazy appreciation as high as 25% per year. We fortunately did not experience that. Yes, we had higher than normal home appreciation last year, but that is much, much lower than those markets. Now, those markets are seeing home values actually depreciate compared to last year.
Fortunately, here in Indiana, we don't ride the rollercoaster like some of these hot states do. So we didn't see our values skyrocket, and now aren’t seeing them plummet. Home values are still up locally, but our market is beginning to slow down.
In November, there were 340 home sales in the eight counties that we cover, while there were 440 last year. Year to date, home sales are down about 6%, which isn't nearly as bad as the 22% that we saw in November. The number of homes listed for sale was also down in November by 6% compared to last year.
"Our current level of appreciation is very stable."
Last year, we saw right around 430 homes listed for sale. This year, we saw 404 homes listed for sale. As I mentioned, home values are still up year over year. The average sales price in the month of November was just under $212,000, which was 3% more than November of last year.
This level of appreciation is very stable, so our cooling market isn’t necessarily a bad thing. As I mentioned, we're completely different from the hotter real estate markets in the United States. Midwestern markets are generally more steady. You don't see the roller coaster rides, which is a good thing.
Interest rates, as you all know, have completely changed throughout this year. At the beginning of the year, they were around 3%; now, the average rate is around 6%. This makes it tougher to purchase a home, but historically, the 6% range is still a low interest rate. As a result of higher rates, there are fewer buyers in our market, which means it’s easier for the ones left to negotiate. It's good that buyers are not having to make distressed, quick decisions like they were the past two years.
Right now, sellers typically get 98% of their asking prices. Meanwhile, the average days on market was 23, which is still very fast. Homes are still selling for a prime dollar very quickly, but buyers have some negotiating power.
We hope you have a Merry Christmas and a wonderful New Year. If you have any questions about this or another topic, please call or email my team. We’re always willing to help!