Slower July Home Sales Combined with Median Price Gains Provide More Opportunity for Area Homebuyers and Sellers
Residential home sales weakened in July in the Champaign County area while the median home sale price rose 2.62 percent, according to the Champaign County Association of REALTORS®. As lower mortgage rates are prompting more buyers to enter the market, it’s putting pressure on the already tight inventory. The total number of homes sold in Champaign County decreased 12.15 percent in July of 2019 with 282 homes sold, compared to 321 homes sold in July of 2018. The year-to-date total number of homes sales are down slightly to 1,654 sales, off 8.52 percent from 1,808 homes sold through July a year ago.
For the month of July 2019, the median home sale price (for all single-family homes and condominiums) was $156,400, up 2.62 percent from $152,000 in July 2018. The average home sale price stood at $177,056, down 0.13 percent from $177,287 last July.
Pending home sales showed a modest gain. There were 226 pending sales in July, up 6.1 percent from 213 a year ago. Pending sales for the month of July reflect the total number of active listings that went under contract and are awaiting closing, usually 30 to 60 days in the future.
“With mortgage rates at near historic lows and nearly a full percentage point lower than they were last year at this time, this certainly is an attractive incentive for homebuyers,” said Eric Porter, president of the Champaign County Association of REALTORS®. “Low mortgage rates and a thriving labor market should help to boost the housing market in the latter half of this year, given that the economy does not incur a significant slowdown.”
The average 30-year fixed rate mortgage for the month of July was 3.76 percent according to the Federal Home Loan Mortgage Corporation, down from 4.52 percent in July 2018 and down from 3.80 percent in June of 2019. The 30-year fixed rate mortgage (FRM) averaged 3.60 percent for the week ending August 15, 2019, unchanged from the previous week.
“Even while we have experienced a softer housing market so far this year, we are seeing prices continue to gain traction.” said Porter. “Historic low rates may entice more buyers to enter the market but flat inventory growth is impeding significant sales growth. Some would-be sellers are simply hesitating from moving forward during this peak buying season even while this does present an ideal opportunity for home sales.”
Inventory of homes for sale declined 4.5 percent in July to 868 homes from 909 homes in July of 2018.
The Illinois Housing Development Authority has launched a new, limited-time grant to help homebuyers across Illinois afford their closing costs. Through the new IHDA Advantage Subsidy program, IHDA will give eligible homeowners who meet income requirements an outright grant of either $1,500 or $2,500 depending on household income to pay for closing costs associated with their home purchase. The grant can be layered with IHDA’s current Down Payment Assistance (DPA) programs, allowing homebuyers to receive anywhere from $8,500 to $12,500 in assistance when purchasing a home. In 2018, IHDA was able to help 5,500 people buy a home through two DPA programs: 1stHome Mortgage and Access Mortgage. Visitwww.ihdamortgage.org to learn more.
Lawrence Yun, chief economist for the National Association of REALTORS®, reports June’s contract signings indicate that buyers are both enthusiastic about the market and of the potential wealth gain, but he added that home builders need to increase inventory. “Homes are selling at a breakneck pace, in less than a month, on average, for existing homes and three months to newly constructed homes,” he said. “Furthermore, homeowners’ equity in real estate has doubled over the past six years to now nearly $16 trillion. But the number of potential buyers exceeds the number of homes available. We need to see sizeable growth in inventory, particularly of entry-level homes, to ensure wider access to homeownership.”
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 August 14, 2019.
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