Business: Four Southeast Missouri broker/owners discuss changing real estate market (5/31/22)

Amid reports the U.S. housing market is cooling off, four Southeast Missouri brokerage owners offer their opinions.

Southeast Missourian file

Local brokerages have weighed in, at the invitation of the Southeast Missourian, about the altered landscape for buying and selling homes, what Fortune magazine last week called a “Great Deceleration.”

The venerable business publication said the breakneck pace of home price growth is “cooling fast.”

National Association of Realtors reported Thursday that pending home sales data show a 3.9% monthly decrease in April — the most recent figure available — with 9.1% fewer homes being sold compared to one year ago.

In terms of geography, NAR’s numbers show all four U.S. regions are showing year-to-year declines, but the Midwest is seeing the least downward impact to-date.

* Midwest is down 2.8%.

Bill Cole

* South: down 10.3%.

* West: down 10.5%

* Northeast: down 14.3%.

Input

* Edge Realty’s Bill Cole said, “We are still in a strong sellers’ market. As of Thursday, Cape Girardeau County had 1.8 months of inventory compared to 1.3 months at the end of May 2021. A seller’s market is considered to be four months or less. I do believe we’ll see inventory of homes available for sale increasing over the next several months but not to the point of being a buyer’s market.”

Lori Fowler

* Lori Fowler of Area Properties commented, “Our business has continued to be steady since the first of the year. However, we feel we may experience some slowdown as mortgage rates continue to inch upward and as inflation puts pressure on consumer buying power. The impact of lower home inventory continues to provide challenges to meeting buyers’ property purchasing needs. On the selling side, the inventory challenge is keeping property values fairly strong. However, strong demand along with (continued) lower inventory may level out as 2022 progresses.”

* Tim Meredith of Century 21 Ashland and Century 21 Premiere added, “We are starting to transition to a more ‘normal’ market. The rise in interest rates has certainly affected affordability in the housing market, so I expect things to moderate. However, the underlying issue of supply and demand will continue to drive the market. I do not see a crash coming, as some speculate. We still have a fairly strong demand in our area, fueled by years of under-building, a strong job market and millennial buyers. While we see the market tapering off a bit, we are still in need of listing inventory to support current demand.”

* Riverbend Realty’s Liz Lockhart concurs with Meredith’s assessment, saying, “I do believe the local market is returning to normal. The fervor of the last couple of years is gradually receding. As interest rates rise, somewhat fewer buyers are looking right now as would-be homeowners have to recalculate price ranges according to what their house payment will be with interest rates significantly higher. Eventually sellers probably are going to have to adjust price expectations, although sale prices are protected by the market that still has too few houses available for sale.”

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Tim Meredith

Liz Lockhart