Wow! It’s already February, and we’re seeing signs of another HOT real estate market here in St. Louis. We can’t say we’re surprised based on what we saw in 2019.
The Year in Review
For the fifth consecutive year, the median sales price reached a new high, hitting $209,900 in December. That’s a 5.5% year-over-year increase!
So, why the increase?
There are a number of factors that have lead to this trend.
First, borrowing money for a mortgage is historically the cheapest it’s ever been! Current 30-year mortgage rates are hovering between 3-4%. Rates like this, combined with an increased number of down payment assistance programs, has driven demand against a dwindling supply of available homes.
Second, supply, or inventory as we call it in real estate land, decreased locally 13.3% year-over-year.
Translation: there were significantly less homes available for sale in 2019 than in 2018 in the St. Louis metro area. This trend, we believe, is largely due to our strong economy creating more jobs, and in turn, increasing demand for housing. While new construction homes and communities continue to pop-up everywhere you turn, even these new developments haven’t kept pace with increased demand. This forces the imbalance of supply and demand, driving home prices up and up.
What will happen this year?
Since 2020 is an election year, we may see some changes. Historically, during election years, economic demand tends to slow a bit as uncertainty reigns (housing market included). However, with the economy humming along, and demand still increasing, 2020 might just be the year we see a new trend.
What does all of this mean to you?
It means that when wading into the murky waters of the market, whether it’s buying a new home, selling an old one, or investing in real estate; it’s best to have the experienced, professional agents of KB Collective there to guide you! Even with larger, stable trends to reference for the entire St. Louis metro area, each neighborhood is unique. We will help you navigate through them all!
Note: Stats provided are from Maris, and are for single-family median price in Missouri (Stl metro counties only)