The number of homes on the market in the Des Moines metro area rose again this past month, to 32.5% over this time last year, reported the Des Moines Area Association of REALTORS® (DMAAR). 2,989 properties were on the market in October 2022 compared to 2,880 properties in September 2022, while in October of 2021, there were 2,255 properties on the market.
Home sales dropped in October 27.6% compared to October 2021. 1,083 residential properties sold in October 2022 while 1,496 homes sold in October of last year.
The median sale price increased slightly from last year. October 2021 the median sales price was $260,000. This October the median sales price was $262,500. The average days on market calculated to 34 days which mirrored last month.
My take: While the market is cooling off a bit, we expected this trend due to the interest rates ticking up and current economic trends plus the holidays are just around the corner. While Buyers are feeling the sting of the higher interest rates, Sellers are feeling the sting of fewer buyers in the market, so now is the time for Sellers and their Realtors to be creative! And price reductions aren’t the only strategy to make your home stand out from the crowd.
Here is an idea I am implementing with my sellers: Offering a buyer a Buydown mortgage loan. Typical buydown is 2/1 but there are 3/2/1 buydowns as well. I explain these in detail in the YouTube video below, but a quick overview is that the seller pays a certain amount of money at closing to reduce the buyer’s monthly payment for a certain amount of time. So, for the 2/1 Buydown, the interest rate is reduced by 2% for the first year and 1% the second year. The 3rd year, the buyer’s monthly payment would return to the original rate. BUT if you do the math, it saves the Buyer thousands of dollars those first two years and then, hopefully, as economist expect, the Fed will be reducing the interest rates in the next 2 or 3 years and Buyers will be able refinance at a lower rate. This strategy has been very successful for my sellers!
There are a few more financing options such as Adjustable-Rate Mortgages as well as Assumable Mortgages to help Buyers get into the home they want at the payments they feel comfortable with.
If you have any questions about the current market, your home’s value, options for you as a buyer, please contact me.