Coldwell Banker Gosslee

Coldwell Banker Gosslee's August Housing Market Report


Summer Heat Leads To Healthy Housing Market
Posted: September 23, 2019 by Jessica Wimberly

SUMMER HEAT LEADS TO HEALTHY HOUSING MARKET

I just got off the phone with a friend who lives in the Northeast. He was describing how August nights start to get a little chilly and once September hits the temperature dips into the 50s in the morning and rises to about 80 degrees.

I wish we had that. August was brutal. September has been no better. But the heat certainly didn’t stop our housing market. In fact, it actually “heated things up.” Sorry for the corniness!

According to the Northwest Louisiana Association of Realtors, Caddo, Bossier and Desoto Parishes had 479 homes sold in August compared to 447 a year ago. We were up 15.7% over the five-year August average of 414.

Homes prices also rose. The median (middle of the list) price of the nearly 480 homes sold in August was $178,000, up 1% over last year. We also saw the number of homes for sale, which we call “inventory,” drop 9% and homes sell quicker than at this time last year. The median days on market was down 12% to 77 days.

Interestingly, our increase in sales and prices, along with a decrease in inventory, mirrored what is happening across the country according the most recent National Association of Realtors (NAR) Existing Homes Sales Report.

NAR reported that just like in here in Northwest Louisiana, sales have increased for two straight months. August saw a rise in national sales of 2.6% equating to an annual expectation of 5.49 million home sales for all of 2019.

The median price rose 4.7% over last August to $278,200. We are a full $90,000 cheaper than that number. That compares to about $400 less per month in house payments from the rest of the country! (I used a 30-year fixed rate at current mortgage levels). 

Just as our inventory was down, so was the national number to 1.86 million homes (-2.6%) which is a 4.1 month supply. Homes stayed on the market for 31 days which is more than half our rate.

I’ve also been watching the slight uptick of first time buyers which continues to hover in the low 30%.

Brad Gosslee, the CEO of Coldwell Banker Gosslee, shared with me why the drop in mortgage rates are really aiding the first timers.

“In Shreveport and Bossier, there are about 1,000 homes on the market priced below $200,000 which is where you would expect a first time buyer to start to look. This is a healthy number of available homes. Even though we are down in sales in this segment by 6% over last year, homes priced at $200,000 and below still are the most active part of the market with 299 of the 479 total homes sold last month. And because mortgage interest rates have dropped so much recently, it has brought a large number of renters to really explore what type of home they could own at the same monthly costs.”

Even though activity at the $200,000 and below price point is off 6% over a year ago in sales, it still is the most active part of our market with 299 of the total 479 homes sold.

I created a chart (with our friends at Fairway Mortgage) that shows “how much house” various monthly rental payments might equate to in mortgage payments. The average rent for a two-bedroom unit in Shreveport is a bit over $1,000. So that is where I started. For this exercise, I (We) did a straight comparison and didn’t consider utilities, insurance, down payments or other fees:

Rent

= This price point with 3.7% 30-year fixed mortgage

= This price point with 3.9% 30-year fixed mortgage

= This price point with 4.1% 30-year fixed mortgage

$1,000

$217,000

$212,000

$207,000

$1,200

$260,000

$255,000

$248,000

$1,400

$305,000

$298,000

$290,000


While homeownership is definitely a viable option for those paying this much rent, please understand there is obviously so much more to it and you definitely need to consult a mortgage professional and/or one of our agents.

The other great thing about the drop in mortgage rates is the impact it is having on the move up buyer. We are seeing an increase in the purchase of $200,000-$400,000 homes with most happening in Shreveport. These buyers are likely willing to make the move because they now do not have to give up their previous historically low mortgage rates. 

And, while we still have a large inventory of $500,000-plus homes in Shreveport and Bossier, buyers are taking advantage here too. Already this year, there have been a combined 80 homes sold at this range with Bossier up an incredible 89%. Add in 89 sales in the $400,000-$500,000 range, a combined increase of 4.5%, and you can see further example of how our market is faring.

If you want to learn more about 25 different Northwest Louisiana neighborhoods, take a look at our amazing Coldwell Banker Gosslee community pages.

Also take a look at the expansive Coldwell Banker Gosslee Residential Real Estate Report.

I hope you liked this!

If you have any questions, please ask any of our 150+ agents in Shreveport and Bossier City or reach out to me at jessica@cbgosslee.com

 

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