ST. JOSEPH, MI ? "In May, the Southwestern Michigan housing market results provided a nice kick start to this year's key selling season. The number of houses sold in May increased 23 percent over April (297 vs. 242) and the total dollar volume per month increased 34 percent ($60,210,421 vs. $45,091,173). The average selling price in May at $202,729 was 9 percent higher than in April ($186,327) and the median selling price increased 4 percent to $144,000 from $138,250. We are still working with a low inventory of houses for sale. So far this year, our inventory has ranged from 7.7 ? 9.7-months supply of homes for sale," stated Gary Walter, EVP, of the Southwestern Michigan Association of REALTORS?, Inc.
Comparing to May 2014, this year in May the number of houses sold was up 11 percent (297 vs 268). Year-to-date, the number of houses sold was up 10 percent (1098 vs. 1003).
The total dollar volume in May 2015 at $60,210,421 was up 10 percent over last year in May ($54,488,009). Year-to-date, the total dollar volume was up 11 percent ($201,631,077 vs. $181,893,519).
Walter said, "Selling prices held very close to last year's selling prices. In May, the average selling price varied by just $584 ($202,729 vs. $203,313). Year-to-date, the average selling price was up 1.26 percent in May 2015 ($183,636 vs. $181,349). The average selling prices in May 2015 and May 2014 were the highest set in a month of May going back to 2006 which we consider to be the peak market year in our area.
The median selling price dipped 1 percent to $144,000 in May 2015 from $145,450 in May 2014. Year-to-date, the median selling price was up 5 percent over last year in May ($125,000 vs. $119,250). The median selling prices in May 2015 and May 2014 were also the highest set in a month of May since 2006. The year-to-date median selling price in May 2015 at $125,000 was the highest set in the yearly comparison.
The median price is the price at which 50% of the homes sold were above that price and 50% were below.
"In May, the number of bank-owned or foreclosed homes as a part of all closed transactions in our market dropped again to 11 percent. In April, the percentage dropped to 13 percent from the 21-22 percent recorded in the first quarter of 2015. Eleven percent was the lowest percentage reached in 2014," stated Walter.
Locally, the mortgage rate edged up to 4.02 from 3.83 in April. At 4.02 the mortgage rate was lower than a year ago when the rate was 4.25 in May. Nationally, the Freddie Mac mortgage rate in May was 3.84 percent compared to 3.67 percent in April for a 30-year conventional mortgage.
"Our inventory of homes for sale in May fell 9 percent from the level we had in May 2014. In May, we had 2511 houses for sale giving us just a 9.7-months supply of houses to meet the current demand. In May 2014, there was an 11-months supply of houses for sale. In May 2010 and 2011, there was over 16- months supply," said Walter.
According to the National Association of Realtors?,fueled partly by an increase in the share of sales to first-time buyers, existing-home sales increased in May to their highest pace in nearly six years. Led by the Northeast, all major regions experienced sales increases in May.
Total existing-home sales,which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, rose 5.1 percent to a seasonally adjusted annual rate of 5.35 million in May from an upwardly revised 5.09 million in April. Sales have now increased year-over-year for eight consecutive months and are 9.2 percent above a year ago (4.90 million).
Lawrence Yun, NAR chief economist, says May home sales rebounded strongly following April's decline and are now at their highest pace since November 2009 (5.44 million). "Solid sales gains were seen throughout the country in May as more homeowners listed their home for sale and therefore provided greater choices for buyers," he said. "However, overall supply still remains tight, homes are selling fast and price growth in many markets continues to teeter at or near double-digit appreciation. Without solid gains in new home construction, prices will likely stay elevated ? even with higher mortgage rates above 4 percent."
The national median existing-home price for all housing types in May was $228,700, which is 7.9 percent above May 2014. This marks the 39th consecutive month of year-over-year price gains.
Regionally, existing-home sales in the Midwest rose 4.1 percent to an annual rate of 1.27 million in May, and are 12.4 percent above May 2014. The median price in the Midwest was $181,900, up 9.4 percent from a year ago.
The percent share of first-time buyers rose to 32 percent in May, up from 30 percent in April and matching the highest share since September 2012. A year ago, first-time buyers represented 27 percent of all buyers.
"The return of first-time buyers in May is an encouraging sign and is the result of multiple factors, including strong job gains among young adults, less expensive mortgage insurance and lenders offering low down payment programs," said Yun. "More first-time buyers are expected to enter the market in coming months, but the overall share climbing higher will depend on how fast rates and prices rise."
All-cash sales were 24 percent of transactions in May for the third straight month and are down considerably from a year ago (32 percent). Individual investors, who account for many cash sales, purchased 14 percent of homes in May, unchanged from last month and down from 16 percent in May 2014. Sixty-seven percent of investors paid cash in May.
NAR President Chris Polychron, executive broker with 1st Choice Realty in Hot Springs, Ark., says Realtors? overwhelmingly support the Consumer Financial Protection Bureau's proposal of a two-month delay for the implementation of the new Truth in Lending Act and Real Estate Settlement Procedures Act Integrated Disclosure, or TRID, regulation. "NAR has long advocated the need to avoid implementing the new regulation during the peak buying season," he said. "With interest rates on the rise, many families wanting to buy are looking to lock-in at current rates and move into their new home before the school year starts. Holding off on TRID implementation through the summer helps these buyers avoid any disruption or delays in closings that could develop once the regulation goes into effect."
Nationally, the total housing inventory at the end of May increased 3.2 percent to 2.29 million existing homes available for sale, and is 1.8 percent higher than a year ago (2.25 million). Unsold inventory is at a 5.1-month supply at the current sales pace, down from 5.2 months in April.
The numbers reported for local sales include residential property in Berrien, and the western half of Van Buren and Cass counties.? All three counties are included in numbers and percentages and do not reflect differences in any individual areas.
The Southwestern Michigan Association of REALTORS?, Inc. is a professional trade association for real estate licensees and ancillary service providers for the real estate industry in Van Buren, Berrien and Cass counties.? The Association is located at 3123 Lake Shore Drive St. Joseph, MI 49085. The Association phone number is (269) 983.6375.? They can also be contacted through their web site, www.swmar.com.
The National Association of Realtors?, "The Voice for Real Estate," is America's largest trade association, representing more than 1.1 million members involved in all aspects of the residential and commercial real estate industries.