Wichita Real Estate Market Report – 22 through 29 April 2018
Purpose of the Wichita Area Real Estate Market Report - The purpose of this report is to provide home buyers and sellers the information necessary to make informed decisions when making the large financial decision that is buying or selling a home. I hope the residents of Wichita, Kansas and the surrounding area will find the information valuable and I welcome any questions or comments.
Housing Inventory Movement: The housing inventory movement metrics describe the current availability of and recent buyer activity. These metrics can also help to predict future market conditions. It is important for both homebuyers and sellers to understand the supply and demand for their market in order to make informed decisions.
Analysis of Housing Inventory Movement: Not much change in the availability of home inventory, the Wichita area is still in a strong Seller’s market with 2.26 months work of inventory. There was a significant drop in both the new house inventory listings this past week, but that should be offset by the significant drop in pending listings as well. The median days on market has dropped again, however, suggesting more buyers are beginning to enter the market again; I expect buyers to start entering the market in larger numbers as the school years come to a close.
New home sales dropped again to 5.69%. This is well below the national average of 10% (as reported by the National Association of Home Builders https://www.nahb.org/en/research/housing-economics/construction-statistics/national/new-and-existing-home-sales-reports.aspx). Because Sedgwick and Butler counties are two of the highest growth counties in Kansas, these numbers are not encouraging for our current housing shortage. Though with interest rates still at historic lows and expected to rise in the future, despite low inventory now is a good time to purchase.
Housing Inventory Pricing: The housing inventory pricing metrics describe the current trends for listing vs selling price, as well as the changes in current values when compared to the previous year. Net sold price is the price a house sells for after accounting for seller credits, this is used instead of sold price because this is a better indicator of market value. These metrics are important for home buyers and sellers to understand so they understand how home pricing affects offers and sale prices.
Housing Inventory Pricing Analysis: In the Wichita area last week, the houses sold on average were much lower in value than the previous week. This is due to a combination of factors but mostly because existing home sales were at a lower price point, there was less new home sales and those home sales that did take place were at a lower price point.
Net sold to asking price ratio continues to rise both for houses sold below the median days on market and those sold above the median days on market. There is still a significant difference between the two ratios, however, with homes selling over the median days on market losing an average of $5,231.79 last week.
For the first time this year, new houses had a net sold price below their asking price. Though the difference is quite small since the builder still nets 99.3% of the asking price. The drop may be due to the builders this week being at a lower price point than the previous weeks.
One change was made in the calculation of appreciation for this past week. In previous weeks we had used the sold price/square foot as a measure of relevant price; this is a little less accurate than using the net sold price/square foot. We found a new technique to provide this more accurate data. We have updated last week’s report numbers to reflect this calculation technique.
It seems that as we begin moving into the summer selling season, the difference in prices between this year and last year reduces in the previous week our appreciation was 2.28% since the previous year. Homes purchased in the winter months seem to have experienced a much greater appreciation than those purchased during the summer months. It will be interesting to see if this trend continues as the Real Estate market comes into full swing this summer.
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*Note: The above metrics were compiled using data provided by the Realtors of South Central Kansas Multiple Listing Service. The data was aggregated from homes listed using the MLS within 30 miles of Wichita (see map below). The data was collected by the author (local Wichita Real Estate Agent - Jared Viernes) on the date the blog post was published. There are many submarkets within Wichita and the surrounding area which may be very different from the averages/medians discussed here. This is meant as an analysis of the overall Wichita area real estate market, not a specific neighborhood.