Northeast Ohio home sales for the year are on track to outpace 2018 levels, and local real estate experts don’t foresee any signs of a major slowdown in the coming months.
Through the first 10 months of the year, sales of new and existing single-family homes in the 18-county area tracked by multiple-listing service Yes-MLS were up about 2.8% from 2018. And, continuing a long-running trend that has shut some prospective buyers out of the market, prices continued to rise.
Average sale prices were up from the previous year in each month of the third quarter and in October, according to non-seasonally-adjusted Yes-MLS data.
In October, the average sale price for single-family homes was up 3.7% to $175,642. For the year, average sale price was up 6.4%, to $180,207.
In Cuyahoga County, year-to-date sales were up 3.1% and average sale price was up 7.1%. In Summit County, sales were down just slightly from 2018, while average sale price was up 5.3%.
Inventory in the region remains tight, but the number of new listings hitting the market may be starting to rise.
New listings inched up 3.2% in October. The trend was more dramatic in some places than others. In Cuyahoga County, new listings were basically flat, but in Summit, listings rose 13.4%.
But is that benefiting buyers?
“The main trend that I have noticed has been a lot of people hesitating to pull the trigger on buying, and that is mainly due to all the media surrounding a potential recession,” said Summer Mayhugh, who works in Northeast Ohio as a listing specialist for real estate brokerage Redfin. “I think people are kind of trying to hold off and wait, thinking that prices are going to go down significantly — maybe they can get a good deal, or maybe they are scared for their financial capability.”
But, she noted, “Our head of economics at Redfin puts the chances of there being a recession [in the next 12 months] at one in four. So I try to tell people, go about the personal timeframe that works for you.”
Affordability remains a concern, particularly for millennial homebuyers who are saddled with high student loan debt, Mayhugh said.
“If you’re financially capable right now, I would pull the trigger while interest rates are low because that will help with affordability,” she said.
On the sellers’ side, she is seeing more interest in putting homes up for sale. Some property owners may believe prices have peaked and see now as the right time to cash in on their investment. Some may simply be looking to downsize.
But Mayhugh doesn’t expect any significant price drops, anytime soon.
“People are still expecting [prices] to fall because of a recession, but a recession isn’t going to be surrounding the housing market like in 2008,” she said. “So I think the chances of prices falling are slim, and if they do fall, I don’t think it would be by very much.”
Home sales statewide are so far on pace to beat 2018 levels, according to data recently released by the Ohio Realtors association. Through October, sales of 130,326 homes just topped 2018’s 129,781 sales.
In October, statewide home sales rose 2.3% from last year. Average home price was up 4.7%, to $192,062.
“The strength and stability of the Ohio housing marketplace is evident, as sales activity levels for the year are besting the pace set a year ago,” Ohio Realtors President Anjanette Frye said in a statement.
Nationally, home sales also ticked up in October, according to data on existing-home sales released by the National Association of Realtors. Sales were up 1.9% from September, for a seasonally-adjusted annualized rate of 5.46 million. They topped last October’s sales by 4.6%.
“Historically low interest rates, continuing job expansion, higher weekly earnings and low mortgage rates are undoubtedly contributing to these higher numbers,” NAR Chief Economist Lawrence Yun said in a statement. “We will likely continue to see sales climb as long as potential buyers are presented with an adequate supply of inventory.”
The national median, or middle, existing-home price rose 6.2% from last October, to $270,900. It marked the 92nd consecutive month of year-over-year price gains.
Inventory dipped 2.7% from September levels and 4.3% from a year ago, putting unsold inventory at a 3.9-month supply.
“The issuance of more housing permits is a very positive sign and a good step toward more inventory,” said Yun. “In order to better counter and even slow the increase in housing prices, home builders will have to bring additional homes on the market.”
Aside from a seasonal slowdown in the winter, local real estate professionals said they expect the market to remain solid for the foreseeable future.
“I think the forecast for the end of the year and going into next year is moderate-to-strong, and we look for continued growth in residential real estate homeownership,” said Kristine Burdick, president of Howard Hanna Real Estate Services’ Midwest market. “Everything is very optimistic heading into the end of this year, and especially heading into 2020.”
Tribune Content Agency