With recession fears, Chinese tariffs, saber rattling and impeachment proceedings, I expected home sales to slack off in 2019. Nope! The St Louis metro just closed the books on a 4.7% price gain, among the best of the decade, with sellers coming off their list price less than I have ever recorded, only 1%. The market started slow in Jan-Feb, then jumped in Mar-Apr, and never let up – cruising through summer and fall, even into December. A cloud on the horizon, though, is that average days-on-market (DOM) increased for the first time in years, by 14%, and home supply (months of inventory) increased almost 5%. A year ago, I predicted a modest 3% price increase, with a 7 year run-up in hand, but the strong economy and stock market, plus drops in unemployment and mortgage rates carried buyers through the potential fears.
Some surprises in the area submarket averages: Jefferson County, typically a slow poke, showed the highest price gains at 7.4%, the largest drop in home supply, and a corresponding drop in price negotiations to zero – the average Jeff County seller did not budge off their list price a penny! St Charles, who also recorded a 100% list price/ sale price ratio, had the 2nd highest price gains at 6.6%, although increasing DOM and supply. St Chas is comfortably in 3rd place for highest sale price in the region of the 7 markets listed here, at $262,254. Maintaining their hold on top price for the metro is the Central Corridor with $437,562, and a favorable 5.2% appreciation rate. Those high prices cost them however, with the highest regional increases in DOM and supply, and the only submarket where sellers had to come off their list price a little more than the previous year. West County was sluggish at 3.8% price gain, and sporting the highest DOM and home supply in the area. I still experience here, though, a very strong demand for homes under $500k, as it continues to be a very popular area to live, with an average price of $369,708.
South County leads the metro with the lowest home supply figure by far, and 2nd lowest DOM. Their attractive $212,688 price, close in location and rising profile schools, has driven demand up, although only experiencing a 4.6% rise in price. I believe this figure will be near the top in 2020. STL City rocked a 6.3% price growth and stayed neck and neck with Jeff County prices, both near the $195,000 mark. The city is enjoying a resurgence in historical passions, with many century-plus homes being renovated and occupied, a desire to be close in, and the tech boom in Cortex and downtown. The Central West End (BJC area just east of Forest Park) commands some of the highest prices per square foot in the region. North County rounds us out with the weakest price growth at 3.7%. However, their DOM rose the least of all 7 submarkets, and their list price/ sale price tightened the most, while home supply was one of only 2 of 7 that dropped, all positive factors. I feel the overload of distress sales, which has been distorting their price figures, is finally behind North County, and now are in a legitimately rising market with substantial demand due to the most affordable prices by far in the STL region, at $107,433.
It pays to have an experienced Realtor representing you on decisions that can save, or cost, you thousands of dollars. Now that I opened my own brokerage 2 years ago, I am better able to serve you, as my 2019 stats show:
– 11 of 13 closed listings were at or near record high prices for that subdivision model; 10 of 14 sold listings went under contract on opening weekend, for list price or more; 5 of 14 sold listings attracted price-escalation clauses.
Owning and operating my own brokerage took away many restrictions of a large, publicly owned company, and gives me the flexibility to offer my clients MORE professional marketing options, and charge LESS.
2019 was my best sales year since 2015, and the winter market has not slowed down, as it typically does. If you plan to purchase a home this year, the time is NOW before the spring run-up in prices and competition. If you plan to sell this year, let’s get it ready for the spring crush!
Gary Hoeferkamp, Broker - Owner of Hoeferkamp Real Estate 