Home sales continue to slump in Lawrence, although home prices not yet going down
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We’ve heated up, evidenced by the fact that I expect to be doused with a Gatorade bath even for minor victories like getting out of my chair without pulling a muscle. But with half of the year in the books, Lawrence’s real estate market still hasn’t even warmed.
We’ve been reporting all year that Lawrence’s real estate market is off to its slowest start — at least in terms of sales — in a long time. The most recent numbers from the June report from the Lawrence Board of Realtors didn’t do much to change the situation.
Home sales in Lawrence were down 13% in June compared to June 2018. Although those numbers aren’t good, they aren’t as bad as some other months Lawrence real estate agents have seen this year. March home sales, for instance, were down nearly 28%, and they were off 18% in May.
Add it all up, and home sales year to date are down 15.9% compared to the same period a year ago. Realtors have totaled 571 sales in Lawrence compared to 679 through June of 2018.
But it also is not like Lawrence’s real estate market is in a free fall. Lawrence home prices, for example, haven’t plummeted. In fact, they aren’t even down. Rather, local home prices simply aren’t increasing at the steep rate they once were. It is worth remembering there are different types of real estate slumps. Sometimes buyers dry up because they have lost interest in a community or are hurting economically. That doesn’t seem to be driving this slowdown in Lawrence.
Instead, Lawrence’s home market continues to be hampered by a relatively low number of homes available for sale. The market is especially tight in the $200,000 price range, Greta Carter-Wilson, president of the Lawrence Board of Realtors, said in the organization’s June report. The tightness is so much so that real estate agents are now pitching the idea that buyers may want to consider purchasing a significantly bigger house in Lawrence in order to get a deal.
“The $400-$500K price range, for example, has slowed but therefore offers great value in selling prices especially for existing homes,” Carter-Wilson said in a statement. “Buyers should realize the value and quality there is in these price ranges, especially with the low interest rates.”
One statistic that shows how tight the home market is in Lawrence is the median number of days a home stays on the market before it sells. Thus far in 2019, the median is just 11 days on the market before a buyer is found for a home. Though that is still a really short amount of time, it is an improvement over the situation last year. Through June of 2018, homes were only sitting on the market for an average of eight days.
Another sign that the market is not quite as tight as it once was is the number of homes listed for sale. In June, there were 293 homes on the market. That was up from 238 in June 2018 and 279 in June 2017.
Here’s a look at some other statistics from the June report:
• The median selling price for homes in Lawrence through the first six months of the year is $214,000. That is up 1.9% from the same period a year ago. So, as I noted earlier, home prices in Lawrence aren’t falling even though the number of sales are. But the rate that home prices are increasing has dropped sharply. In June 2018, median selling prices were up 14% from 2017 numbers. In June 2017, they were up 5.5% from 2016 levels.
• Despite a relatively small number of homes on the Lawrence real estate market, builders have not responded by building a lot more homes. There were some signs in 2018 that builders were ramping back up. In June 2018, there had been 73 new homes sold in the Lawrence market, which was nearly an 18% increase from a year ago. But this year, sales of newly constructed homes are down nearly 22% to a total of 57.
• If you want to buy a newly constructed home in Lawrence, you should plan on spending about $350,000. The median selling price for new homes is $348,500 thus far in 2019. That selling price is up just 1% from the median in 2018. Also worth noting is that new homes are taking significantly longer to sell than existing homes. As noted earlier, the median number of days for a home to sit on the Lawrence market before selling is 11 days. But for new homes it is 77 days. That’s basically unchanged from last year, but is up from 61 days in 2017.
Home sales are down nationally, too, but it is interesting to see how much slower home sales are in Lawrence than in the Kansas City market. The June report from the Kansas City Regional Association of Realtors shows home sales are down 6.3% for the year, or a little less than half as much as they are in Lawrence. Home prices also are increasing at a greater rate than in Lawrence, with the median selling price at $218,000, which is up 6.3% from a year earlier.