Lawrence home prices continued to rise in 2019; number of local sales declined
photo by: Douglas County GIS
Buying a home in Lawrence didn’t become any easier or cheaper in 2019, as the latest report shows home prices now have increased 26% since the middle of the decade.
The number of homes sold in Lawrence last year dropped by about 2% compared to 2018 levels, while the median selling prices of homes increased by more than 4%, according to the year-end report from the Lawrence Board of Realtors.
The slowdown in sales is blamed on a small supply of homes available for sale. This is the second year in a row that Lawrence home sales have fallen because of tight inventories. That same supply crunch also is a factor in the increasing home prices.
A top Realtor in the city said he expects more of the same in 2020.
“Look for a continuation of 2019 trends well into 2020 as this pressure cooker market continues to make navigating the market difficult for most homebuyers,” Ryan Desch, president of the Lawrence Board of Realtors, said in the report.
Wallets are perhaps feeling the pressure most of all. Board of Realtors data shows that the median selling price of a Lawrence home in 2015 was $169,000. By the end of 2019, the median selling price had increased to $214,000. That’s an increase of 26.6%.
As city leaders debate ways to tackle affordable housing — if you recall, voters in 2017 approved a new sales tax devoted to the effort — the new numbers show some of the challenges facing homebuyers.
Home prices since 2015 have increased at a rate faster than incomes of Lawrence residents. In 2015, the median home price was 2.3 times higher than the median family income of $74,100, as measured by the federal department of Housing and Urban Development. By 2019, the median home price was 2.6 times the average family income of $81,900.
Based on those numbers, though, a family with average income still would be able to buy an average-priced house and keep their mortgage payments below the widely quoted guide that housing costs should be no more than 28% of a household’s gross income.
Lawrence, however, did benefit from a slowdown in home prices. While prices were up 4.6% on average, that is much less than the 13.6% increase in median home prices that Lawrence posted in 2018. That was the largest increase in average selling prices in recent memory.
The amount that home prices have increased in recent years has been a bit erratic. Here’s a look at median home price increases in Lawrence since 2015:
• 2015: $169,000, up 1.2%
• 2016: $178,000, up 5.3%
• 2017: $180,000, up 1.1%
• 2018: $204,500, up 13.6%
• 2019: $214,000, up 4.6%
While the pace slowed in 2019, there were signs at the end of the year that prices might be picking back up. There were 92 home sales in December, which was an increase of about 40% from December 2018. The median selling price in December 2019 was 13% higher than in December 2018.
There also were signs that January might be robust. There were 82 pending contracts at the end of December, which was nearly a 40% increase over the same totals a year earlier.
One category of Lawrence home, however, did see a decline in its median selling price in 2019. The median selling price for newly constructed homes was $334,900, down 1.3% from a year ago. The drop in prices comes as the Lawrence market sold its smallest number of newly constructed homes in a year. There were 97 newly constructed homes sold in Lawrence, down about 26% from a year ago. The 97 new homes sold was the smallest number since 83 were sold in 2015.
Here’s a look at some of the key numbers from the year-end report:
• Home sales totaled 1,201 in the city of Lawrence, down 2.1% from a year ago.
• The total dollar value of homes sold in Lawrence was $290.9 million, a drop of 0.4% from a year ago.
• The median number of days a home stayed on the market before selling was 14, up from 12 in 2018. But Desch said that owners trying to sell homes at $350,000 or more are seeing their properties sit on the market much longer.
The trends in the Lawrence market in 2019 were similar to what has happening in the nearby Kansas City market. Home sales in the Kansas City metro area didn’t fall as much as they did in Lawrence, but larger price increases also took hold in the KC region. Home sales fell by 1.5% for the year, while the median selling price increased by 6.1% to $217,450.