Rising inflation, soaring home prices, and increased mortgage interest rates have combined to cause a slowdown in the U.S. housing market. To help quell inflation, which reached 8.6% as of last measure in May, the Federal Reserve raised interest rates by three quarters of a percentage point in June, the largest interest rate hike since 1994. Higher prices, coupled with 30-year fixed mortgage rates approaching 6%, have exacerbated affordability challenges and rapidly cooled demand, with home sales and mortgage applications falling sharply from a year ago.
New Listings in Washtenaw County increased 1.7 percent for Single Family homes but decreased 19.4 percent for Townhouse/Condo homes. Pending Sales in Washtenaw County increased 21.6 percent for Single Family homes but decreased 11.5 percent for Townhouse/Condo homes. Inventory decreased 31.6 percent for Single Family homes and 44.0 percent for Townhouse/Condo homes. Median Sales Price in Washtenaw County increased 8.4 percent to $412,000 for Single Family homes but decreased 1.1 percent to $273,000 for Townhouse/Condo homes.
Average Days on Market in Washtenaw County decreased 25.0 percent for Single Family homes and decreased 37.0 percent for Townhouse/Condo homes. Months Supply of Inventory in Washtenaw County decreased 26.3 percent for Single Family homes and decreased 42.3 percent for Townhouse/Condo homes. With monthly mortgage payments up more than 50% compared to this time last year, the rising costs of homeownership have sidelined many prospective buyers.
Nationally, the median sales price of existing homes recently exceeded $400,000 for the first time ever, a 15% increase from the same period a year ago, according to the National Association of REALTORS®. As existing home sales continue to soften nationwide, housing supply is slowly improving, with inventory up for the second straight month. In time, price growth is expected to moderate as supply grows; for now, however, inventory remains low, and buyers are feeling the squeeze of higher prices all around.
Courtesy of the Ann Arbor Area Board of REALTORS
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