Spring is finally here, meaning warmer weather, tourists and the beginning of the real estate season.
New listings are beginning to increase as we enter into warmer months. However, listing trends still lag behind that of 2015. In April 2015, 690 homes were on the market. Meaning that in the spring of 2016 we are 100 plus homes behind the usual seasonal trend as seen below:
- February 2016 listing: 530
- March 2016 listings: 560
- April 2016 listings: 583
Interestingly, pending sales have jumped between March and April by 62 pending sales as seen below.
- February 2016 pending sales: 254
- March 2016 pending sales: 292
- April 2016 pending sales: 359
In 2015 pending sales remained relatively stable throughout the spring months as seen below:
- March 2015 pending sales: 312
- April 2015 pending sales: 311
- May 2015 pending sales: 314
April 2016 marks the highest pending sales seen in well over a year, surpassing even the summer months of 2015.
However, sales have not increased as frequently despite the rise in pending sale as seen below:
- February 2016 sales: 151
- March 2016 sales: 228
- April 2016 sales: 236
This phenomenon between increased pending sales yet a lack of sales conversion may be due to a few reasons. First, with the new TRID laws lenders are averaging closer to 45 days to close instead of 30 days prior to the laws. Therefore, sales may be converting more slowly.
Conversion may be hindered due to specialty loans. Over the past few months we have seen delays in numerous closings due to delays in VA or USDA inspections, appraisals or underwriting. This may be due to more buyers entering into the market and utilizing these loan services. Without an increase in work force the appraisers, underwriters and inspectors maybe bogged down by an increase of need
In addition, to increased pending sales and a delay in sales conversion the average price per square foot has made another huge increase as seen below:
- February 2016 price per sq ft: $205
- March 2016 price per sq ft: $206
- April 2016 price per sq ft: $212
Since the beginning of the year the price per square foot for homes in Bend has jumped up by $14 a square foot. This means if a buyer had purchased a 2000 sq ft home in January they would have paid approximately $396,000 using the average price per square foot of $198 from January. Now if that buyer were to buy the same house using the new average price per square foot they would pay $424,000, which is a $28000 difference.
It is a great time to sell a home with the price of homes increasing, a lower than usual inventory and buyers entering into the market as the summer months come.