Comparing the first 6 months of 2022 to 2021 | 7/11/22

My report comparing the first six months of this year to the same period last year will be a repetition of many aspects of my past reports – the market continues to show increases in average sales price and list-to-sell-ratio. Days on market continues to decrease and the housing inventory is still low. As in the past, I look at single family and condos together in Chittenden, Franklin, and Grand Isle counties. 

One might expect with an increase in the mortgage interest rates that the housing market would make a major correction and we would see a drop in prices. This article published on June 15th in Fortune says that nationally we are seeing that correction given a 3.2% increase in morgage rates over the past 12 months. This is very interesting and worth the time to read it.

But are we seeing the cliff in our area? Decide for yourself given these statistics: 

In Chittenden County in 2021, 812 homes sold with an average sales price of $438,110. Sellers received 101.5% of their final asking price. The average days on market was 32. This year, 805 homes sold with an average sales price of $522,129. Sellers received 105.55% of their final asking price. The average days on market was 20. The average sales price in 2022 represents an increase of 10% - and this is only a six-month period. In addition, sellers received 3.85% more this year than last when considering the percentage over asking. The number of days on market decreased significantly.

We also like to look at the “absorption rate” or how long it would take to empty the market of current listings if no new homes came on the market. We calculate using the number sold per month and divide that number into the current inventory. We usually like to look at 12 months but if we look at six months, the average number sold per month in Chittenden in the past six months is 134. There are currently 143 properties for sale. Therefore, it would take about one month to empty the market of properties if no new homes came on. Under six months is a seller’s market regarding supply vs demand. Therefore, it’s a “super seller’s market” in Chittenden County. 

In Franklin County, there is a similar story but with a marked decrease in the number of homes sold – the average price is up but fewer sold. In 2021, 308 homes sold with an average sales price of $281,136. Sellers received 100.53% of their asking price. The average days on market was 48. In 2022, 270 homes sold for a 13% decrease in the number of homes sold. However, the average sales price rose 11% to $343,212. Sellers received 102.66% of their asking price for a 2.13% increase over 2021. The average days on market decreased to 36. 

An average of 45 properties sold per month in the past six months and there are currently 92 properties for sale. That means a two-month inventory and a seller’s market in Franklin County. 

In Grand Isle County, 77 homes sold in 2021 with an average sales price of $413,265 in an average of 81 days. Sellers received 97.77% of their asking price. In 2022, the average sales price increased only slightly to $419,410. Only 53 homes sold, but they took significantly less time to sell than in 2021 – 51 days on average. Sellers received closer to their asking price, 100.44%.

In Grand Isle County, 9 sold on average per month in the past six months and there are 26 currently for sale. This means the market is a little softer in Grand Isle County with a three-month supply, but still a seller’s market. 

Where is the market going? Here is my prediction: If interest rates continue to rise, many buyers will be priced out of the market. Those buyers that can afford to buy at the new rates are possibly buyers who have been looking for some time and have lost out on several homes. They will do what it takes to buy a house and will keep trying! I think we will have fewer new buyers entering the market. I think the prices will continue to increase. And I hope that when the current slew of buyers find a home, that the interest rates fall back to the rates we saw six months ago! 

Here is the National Association of Realtor’s Economist, Lawrence Yun’s take on the market. He reflects nationally.