Southwest Michigan housing market begins 2016 with surge

By Tony Wittkowski | Business Reporter | The Herald-Palladium

ST. JOSEPH — The housing market began the new year on the right foot.

The number of Southwest Michigan houses sold increased 30 percent compared to January of last year. Comparing January sales going back to 2006, January 2016 had the second-highest number of houses sold.

“January was a record-setting month in many ways for Southwest Michigan,” said Gary Walter, executive vice president of the Southwestern Michigan Association of Realtors Inc. “When comparing the numbers back to the peak year of 2006, our current market seems to be very robust.”

However, these home sales come at a cost.

With sales steadily increasing each month, the depleted housing inventory is tightening even more.

“Falling to a record low 6.6-months supply, the housing inventory continues to be a dilemma for buyers,” Walter said. “The inventory at the end of January was 1,830 houses for sale compared to 1,937 in January 2015. The problem is we are not adding to the inventory.”

The total dollar volume in January 2016 was up 23 percent over January 2015. The total dollar volume in January 2016 was the highest recorded since 2006.

The average selling price of $200,335 in January 2016 was down 5 percent from the $211,075 average selling price in January 2015. However, both average selling prices were the highest in the 11-year comparison.

The number of bank-owned or foreclosed homes that were part of all closed transactions in January 2016 was 18 percent. This set the record for the lowest January percentage since 2009.

The highest percentage of bank-owned or foreclosed homes for all closed transactions was 75 percent in February 2009. The lowest was 9 percent, set in July and October 2015.

Locally, the mortgage rate decreased from 4.6 in December to 3.99 in January. Nationally, the Freddie Mac mortgage rate in January was 3.87 compared to 3.96 in December for a 30-year conventional mortgage.

Contact Tony Wittkowski at twittkowski@TheHP.com or (269) 932-0358. Follow him on Twitter: @tonywittkowski.

(Author’s Note: This article was originally published on March 10, 2016)

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