Champaign County area home sales declined slightly during the month of November as prospective buyers postponed their purchasing decisions, according to the Champaign County Association of REALTORS®. CCAR reports a total of 176 residential home sales were sold in November, down 6.88 percent when compared to 189 sales in November of 2018.
The median home sale price rose 14.05 percent to $155,000 in November from $135,900 in November of last year. The median is a typical market price where half the homes sold for more, half for less.
The average home sale price also reported double-digit gains to 16.07 percent to $185,656 from $159,947.
The 2019 year-to-date number of homes sold decreased 6.89 percent with 2,540 sales through November of this year, compared to 2,728 from the same period a year ago.
The inventory of homes for sale declined 7.8 percent in November to 796 listings from 863 listings a year ago. Pending sales, a sign of future real estate activity, increased 14.6 percent in November to 141 pending sales as compared to 123 a year ago. Pending sales for the month of November reflect the total number of active listings that went under contract and are awaiting a closing, usually 30 to 60 days in the future.
“Even while the market faces an ongoing inventory challenge, we saw some positive forward-looking indicators during November. The pending sales volume rose 14.6 percent compared to November last year. This could be attributed to the desire of buyers to make purchasing decisions and close before the end of the year to take advantage of homeownership tax benefits. Definitely homes under $200,000 are selling quickly as millennials, the largest segment of buyers, invade the housing market to take advantage of low mortgage rates,” said Julie Roth, president of the Champaign County Association of REALTORS®. “It is not unusual to see a seasonal slowdown during this time, but in hindsight, winter is a great time to sell as inventory is traditionally lower and buyers have idle time on their hands and are online searching listings and shopping for their wish list.”
The average 30-year fixed rate mortgage for November of 2019 was 3.69 percent according to the Federal Home Loan Mortgage Corporation, down from 4.87 percent in November of last year and steady at 3.69 percent in October, 2019. For the week ending December 12th, the fixed rate mortgage averaged 3.73 percent. With economic expansion expected to continue into the new year, the 30-year fixed rate mortgage could see steady inclines over the long haul, Freddie Mac reports.
“Homes are selling faster and bidding wars are becoming commonplace as inventory tightens and with a shortage of new listings coming on the market,” said Roth. “Looking ahead, the housing market continues to be driven by low mortgage rates, a strong labor market and motivated buyers that should continue to fuel the market into 2020. While delinquency rates remain low across most types (including mortgages) higher consumer debt loads can limit future household spending capability and increase risk if the economy slows down.”
According to the National Association of REALTORS® first-ever Real Estate Forecast Summit, economists who gathered in Washington on Dec. 11th expect the U.S. economy to continue expanding next year while projecting real estate prices will continue to rise and reiterating that a recession remains unlikely. The average annual 30-year fixed mortgage rates of 3.8% and 4.0% are expected for 2020 and 2021, respectively. The annual median home prices are forecasted to increase by 3.6% in 2020.
“Real estate is on firm ground with little chance of price declines,” said NAR’s Chief Economist Lawrence Yun. “However, in order for the market to be healthier, more supply is needed to assure home prices as well as rents do not consistently outgrow income gains.”
The Champaign County Association of REALTORS® is a voluntary trade organization serving Champaign County and surrounding areas and is the leading resource for REALTOR® members and an advocate for homeownership and private property rights. Statistics are from residential sales within the Champaign County area. Data compiled by Midwest Real Estate Data, LLC as available on November 14, 2019.