You can describe the real estate market in one word… “Crazy”. Continuing on the same path as reported at the end of the first quarter, Des Moines REALTORS® have closed over 3,400 home sales in the 2nd quarter of 2015 and over 5,600 since January 1st putting us almost 19% ahead of last year.
For the most part, sales remain most active in the under $300,000 price range although we have seen increased activity in the higher priced markets, the $100,000–$200,000 has been the hottest price range. At the same time Pending transactions (a leading indicator of the pace of sales) has slowed down.
As we enter the 3rd quarter, the number of closed transactions will begin to slow as well. This is all expected and normal as our market traditionally slows down a bit over the summer before getting a second wind just as schools go back into session. So expect the feeling of a roller coaster ride in the next three months.
- 2,950 homes came on the market this quarter and almost 4,000 homes were sent into pending status. This is keeping our overall home for sale inventory levels very low. Median days on the market was 22.
- We have not spent one single day this 2nd quarter above 3 months of inventory, which is defined as a Sellers Market.
- The sale price of homes has risen and market values are also seeing an increase this year, as buyers are willing to pay more for homes. The average sales price in the second quarter was $195,570.
- Mortgage interest rates have helped the affordability of buyers to be able to pay more.
- Certain pockets of the metro are seeing such a shortage of inventory that multiple offers are occurring within days or even hours of hitting the market. The Beaverdale area for example is one of the hottest areas of town. Ankeny is the most active community.
- Bank owned property inventory continues to decline back to our near normal levels of below 3%. This is a good sign of our local economy.
- New construction is still very popular and filling in the void of existing homes for sale by creating new inventory. In the second quarter there were 952 new homes for sale with 492 sold.
- One in four homes for sale in our market right now is new construction.
- With over 5,700 homes sold year to date, we are just short of 1,000 sales ahead of the same time last year and on track to close 12,000 sales in 2015.
My outlook for the 2nd half of 2015 is that we will continue to see a pattern of low inventory and higher list and sale prices and a shorter time spent marketing homes until they go into Pending status. I expect to see mortgage interest rates finally begin to rise, but only at most by 1% by years end.