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Is the market trending towards another steep price increase? Or are we even seeing things pick up at all?

As far as the stats go, April 2023 looked incredibly similar to March 2023 in total sales, new listings and the sales to active listings ratio, which is quite unusual as April will typically outperform March in all 3 categories. With 1,488 sales in April 2023 we saw 0% change compared to March 2023, and 5% fewer sales than April 2022. If you remember last years market at all, you will know that mid march 2022 was when the market began to slow right down and prices began to decrease. If in a typical year April will outperform March in sales and new listings, why is that not the case this year?

It seems that lack of inventory is one of the key factors for the lower numbers, but the other side of the coin that cannot be captured in statistics very easily is the fact that inventory numbers are likely even lower than they appear to be.  What I mean by this is the fact that we are still seeing many homes come on the market priced as if we are in March 2022. While we certainly have seen prices increase in the last 2 months, we are still more than 16% lower on average price than we were in March 2022, so all those overpriced homes are shown in the inventory numbers, but they are not realistically likely to sell.

Total sales for April 2023 came in 15% fewer than the 10 year average and there were 27% fewer listings in April 2023 than the 10 year average. We typically would not be seeing prices increase when total sales are so much lower than the 10 year average, but the lack of inventory is still continuing to drive prices upwards. If you’ve read this newsletter before you will have heard of the sales to active listings ratio. This is the number of homes that sell in a given month in comparison to the total number of homes available in said month. Anything above 20% is considered to be a seller’s market, and April 2023 finished with a 39% sales to active listings ratio. While we have certainly seen a much higher number in this stat, we have to keep in mind what I mentioned earlier about the many homes that are just priced so unreasonably that it is difficult to count them as “inventory” but unfortunately we cannot come up with any numbers to adjust for this as it is not really able to be counted with any accuracy.

With prices increasing an average of 2.7% in April 2023 compared to March 2023, we can see that prices are beginning to climb somewhat aggressively again.  It is still far too early to begin to panic and think that the market is going to take off as it did during the pandemic, however, we should be watching quite closely as prices will likely continue to increase if more homes are not listed at realistic prices.  It is not uncommon to see lower than average inventory numbers in a market where prices are just starting to increase again. In many sellers’ point of view, a benchmark price for them to sell was established at the peak of the market in March 2022, so until prices start to catch up to a year ago, we will likely continue to see a lack of inventory.

My day to day observations in certain parts of the market do feel quite different than the statistics are saying. Multiple offers seem to be coming in waves. One week most of the available homes will sell with multiple offers, only to see all the new homes on the market in the next week see no offers at all. It feels as if the market could be ready to take off, however, it seems that buyers are more reluctant to offer much higher than the last sale compared to the pandemic market where buyers were getting so desperate they were often offering 3-5% more than the last sale of a similar home that sold only one week prior.

Overall the market is still a great market to make a move in, as well priced homes are still selling quite quickly, but not so quickly that you have no time to think about things on the buying side. If you are considering making a move anytime in the next year or so, be sure to reach out sooner than later so that we can make a plan for your unique situation and monitor the market to make sure you have the most up to date information to make a great decision.