Lawrence home sales fall by largest amount in recent memory, but selling prices end year above $300K

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One short bang does not cancel out one long thud.

That, at least, is the case for Lawrence home sales in 2023. The number of homes sold in December did indeed produce a bang, growing by nearly 35% from a year earlier. However, that end-of-year surge was nowhere near enough to stop 2023 from becoming the third straight year of declining home sales in Lawrence.

Home sales in Lawrence fell by 21.9% in 2023 compared with 2022 totals. The year-end report by the Lawrence Board of Realtors tallied 876 sales for the year. That was down from just more than 1,100 sales a year ago and nearly 1,300 sales two years ago.

If you are keeping track at home, 2023 produced the largest decline in Lawrence home sales in recent memory. It was larger — by a wide margin — than any decrease since at least 2018, which is as far back as statistics on the Realtors’ website go. The next largest decrease actually was 2022, when home sales dropped by 13.2%.

If you are keeping track with your wallet, you perhaps have not noticed much of a decline. That’s because home prices did not decline, despite buyers being harder to find. The median selling price of a Lawrence home increased 4.2% and ended the year above the $300,000 mark for what is believed to be the first time in history.

In case you slept through statistics class (my idea of standard deviation was to skip the homework, despite being told otherwise), a median is the point at which half of everything is above that point and half of everything is below that point. In other words, with a median selling price of $302,250, slightly more than half of all homes in Lawrence sold for more than $300,000 in 2023.

That won’t be welcome news for community leaders concerned about affordable housing in the city. But the numbers did provide one positive point on that front. The 4.2% increase in the median growth price was much smaller than it had been. In 2022, median selling prices increased by 10%, and in 2021 the median increased by 11.5%

Local real estate leaders attributed rising mortgage interest rates for much of the steep decline in Lawrence home sales. The national average for a 30-year fixed rate mortgage began 2023 at about about 6.5%, according to statistics from the Federal Reserve. The national average ended the year at about 6.7%. However, in between, interest rates climbed to a recent high of about 7.8%, hitting that mark in October.

In other words, mortgage rates have been on a fairly steep decline since the fall. It was in December — as home sales increased 34.7% from December 2022 — that many local buyers started to notice, the Realtors theorized.

“The market reacted positively in December,” Jill Ballew, president of the Lawrence Board of Realtors, said in the year-end report.

Ballew also said the preliminary numbers for January also look good. Local Realtors ended December with 52 pending contracts — contracts that should become sales in January — which was an 8.3% increase from a year ago.

Ballew also said real estate agents were mildly encouraged by the number of homes on the market. There were 136 homes on the market in December, up from 101 in December 2022 and just 80 in December 2021.

While those numbers represent a significant improvement, they are still well short of where Lawrence was prior to the pandemic. In both 2018 and 2019, Lawrence ended the year with about 220 homes on the market, according to statistics from the Realtors association.

Lawrence’s 2023 results also suggest the city had a deeper decline than some other large markets in the state. The Kansas City metro area also saw a decline in home sales in 2023, but not as large as the one in Lawrence. Selling prices in the KC metro also did not increase by as much as they did in Lawrence. The number of sales in the KC metro declined by 14.9%, and median selling prices increased by 3.1%, according to figures from the Kansas City Regional Association of Realtors.

In Wichita, the slowdown was even less so. Home sales in the greater Wichita metro area declined by 10.6%, while the median selling price was up 4.4%, according to figures from Realtors of South Central Kansas.

The median selling price in the Wichita region was $215,000, while in the KC metro it was $295,000. In other words, homes in Lawrence had median selling prices about 2.5% higher than those in Kansas City and about 40% more than in Wichita. Other major metro markets, such as Topeka, hadn’t yet released their 2023 year-end statistics on their websites.

Here’s a look at other year-end statistics from Lawrence’s report:

• The average number of days a home sat on the market in Lawrence before selling was 19, which was up from 15 in 2022. In the KC metro, that average was 36, while in Wichita it was 23 days.

• Lawrence real estate agents have said a lack of available homes for sale has driven the Lawrence market to move very quickly. However, Lawrence’s inventory of available homes ended the year similar to both KC and Wichita in one key regard. Real estate agents measure inventory by how long the market’s current inventory would last, based on current sales rates, if no new homes were added. Lawrence ended the year with 1.9 months worth of inventory, which is up from 1.1 months in December 2022. Kansas City and Wichita both ended the year with lower inventory levels, at 1.8 and 1.7 months, respectively. That could be a good sign for Lawrence in the months ahead. Lawrence’s supply of available homes, by that particular metric, increased more than either Kansas City’s or Wichita’s, which may mean that Lawrence’s housing market, every so slightly, is becoming more balanced between buyers and sellers.

• Local real estate agents, who get paid via a sales commission, likely felt the 2023 downturn in their wallets. The total dollar value of all homes sold in 2023 was $293.8 million, down from $368.2 million in 2022.

Lawrence home sales by the year

2023: 876

2022: 1,122

2021: 1,292

2020: 1,339

2019: 1,201

2018: 1,227


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