November 2022 Grand Rapids Real Estate Market Update
Market Update Transcribed
Welcome to November, 2022.
Hope everybody's had a great fall season. Sales have been great, been loving the warm weather, the mild weather so far this fall. Hopefully, both numbers continue. I got a feeling this is goning to be the most important market update that I've ever made. And the reason being, is I'm on social media just like everybody else. I'm talking to buyers just like other real estate agents are. And everybody seems to be predicting a crash. I'm even watching the news, reading the news, trying to stay up-to-date, and I keep hearing about how the real estate market's going down.
I keep hearing about a pending crash here. So I went ahead and I wanted to look at the data. You know, people, a lot of these stories out there are based on emotions. A lot of these people's feelings and decisions that they're making are based on emotions and not looking at the data. And I wonder, I pulled numbers here just a little bit ago, and I did the entire Grand Rapids market. Single family homes, I didn't include vacant land. I also didn't include multi-family homes. It's just single family homes. And right now we're at 1.3 months worth of inventory.
What does that mean?
That means that if our entire association did not list another house here, we should be out of inventory, 100% out of inventory, in about five weeks. Now also, a buyer's market should be somewhere around five months worth of inventory. That number tells me that we could actually triple our amount of listings, and it would still be a seller's market. That's how far away we are from a buyer's market, right?
I also wanna look at numbers, compare October of 2022 to October of 2021. I found this to be very interesting. And if you remember in October of 2021, we had rates in the low to mid threes. Right now, we're in the sevens, mid sevens, and year-over-year, the median sales price is actually up almost 6% year-over-year. So despite the higher interest rates, values are still going up. 6% is down a touch, it is down a little bit here. At this point last year we were up at around 7 or 8%. But remember, average is about 3%. So we are getting a long ways away from a buyer's market.
I will give my personal prediction here, my personal prediction just knowing what I know and going through this over the last 25 years, this is not the first time I've seen this market. I do feel rates will continue to go up. I'm reading 10%. I don't think it's gonna go that high. I really don't feel it's gonna go that high. But I wouldn't be shocked if we're in the mid eights, knocking on the door of 9% before the end of 2023. I do still see values going up as I don't see any reason why values should go down. We don't have any foreclosures. We don't have any wave of homes hitting the market. So I don't see any way to see supply get so high that it's gonna turn into a buyer's market, just looking at the data.
I've been in the business now for a couple of decades, so going off those numbers is where I'm basing my opinion off of. Also, when I got into the industry, rates were in the nines. Back then, subprime buyers were getting from 10 to 16% interest rates. A+ buyers would be around 9%. And that was also a seller's market. So I still feel it's gonna be a seller's market here. I'm also gonna say that going into the next election, I wouldn't be shocked to see rates go down at that point.
So, with that being said, people can actually buy at today's values and get tomorrow's rates. And yes, you'll pay a higher interest rate for now, but you can simply refinance when rates go down. So that's been our advice to all buyers.
If you're looking to buy you might wanna step up the urgency and start looking now, and then worry about the mortgage rates down the road.
If you know of anybody that's looking to buy or sell please do me a favor, pass my information on to them. We have had a phenomenal year, actually a record year. We're gonna knock onto the door of 80 million in sales for the first time, so it's been a great year for our team, had a lot of fun this year.
So if you do know of anybody that's looking to buy or sell, let me know. If you know of anybody that even just wants to know what their house is worth in this crazy market, you know, pass my information on to them. Happy to do market analysis for them. If anybody has any questions, reach out to me. Again, my name's Jason Lash. I'm the Team Leader and Associate Broker with The Lash Group at EXP Realty. Make it a great day. Take care.
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