As pandemic fallout hit Lawrence in April, home prices soared; sales remained high too, but possible signs of weakness ahead
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Maybe Lawrence homebuyers in April already had a key aspect of our new lives figured out: If forced to live with a stay-at-home order, you will want to do so in a better home. (Pandemic philosophy: Your nothingness becomes smaller if you do it in a larger space.) Whether it was that realization or something else, local home sales were strong in April, despite any pandemic-related fears.
In a sign that may be ominous for those worried about affordable housing issues, prices also soared during the month.
Lawrence home sales totaled 128 houses for the month of April. That was up 12.3% from April 2019 totals. The more eye-catching number is that the median selling price during the month was $232,000, an increase of slightly more than 22% from April 2019.
The president of the Lawrence Board of Realtors, which produced the monthly sales report, said buyers largely followed through on previously signed contracts, which in many cases were agreed to prior to the pandemic disruptions fully taking hold in Lawrence.
Where the real estate industry did see a slowdown is in the number of sellers who were putting their homes on the market in April. The number of new listings was down almost 44% for the month. That lower supply helped pushed selling prices higher.
The Lawrence home market already was strained by a lack of homes for sale prior to the pandemic. That had been the case for a couple of years, but there were some signs that inventories were starting to grow, until the pandemic came along. The situation created a very fast-moving market in April. The median number of days a home sat on the market before selling was four.
The strong April added to what has been a hot real estate market thus far in 2020. The year-to-date statistics show home sales in Lawrence are up 22.6% compared to the same period a year ago.
With the surge in April, the median selling price for a home thus far in 2020 is $227,900. That’s an increase of 10% from the same period a year ago.
Other statistics from the monthly report include:
• Sales of newly-constructed homes have been particularly strong. Builders have sold 41 homes through April, an increase of nearly 52% from the same period a year ago.
• The median number of days a home has set on the market in 2020 before selling is 11, down from 16 days during the same point a year ago.
• With both the number of home buyers and prices on the rise, the Lawrence real estate industry was having a good year. The industry had sold $87.3 million worth of homes through April. That’s up 28% from a year ago.
But, as we are learning, nothing is invincible, (which is what I tell my iron will when I decide to have an extra bag of Doritos for breakfast.) The local real estate market did start showing some signs that a downturn may hit it in May or beyond. The number of contracts written during April fell to 99. That’s down 36% from the same time period a year ago. That could be a sign that home sale numbers in May or June may decline significantly.
But Lawrence Board of Realtors President Ryan Desch said he still thought home-buying activity could be solid for the year, but purchases may just be delayed a bit.
“Provided that the COVID-19 situation improves as stay-at-home orders ease, most Realtors expect the activity typically seen in spring to emerge in summer and remain throughout and into the fall,” Desch said in a release.
It will be interesting to watch how the Lawrence market reacts in the coming months. For whatever reason, the Kansas City real estate market reacted much differently to the pandemic in April than Lawrence’s.
According to statistics from the Kansas City Regional Association of Realtors, the Kansas City metro area saw home sales decline by nearly 7% for the month. While home prices did increase some, they didn’t rise nearly as much as they did in Lawrence. The median selling price rose 6.5% for the month to $230,000.
A big difference in the market is the supply of houses. While the supply of houses in the Kansas City market did shrink by 32% for the month, the market isn’t nearly as tight as Lawrence’s. The median number of days a home sits on the market in Kansas City is 58, thus far in 2020. That’s compared to the 11 days in Lawrence.