Home sales dropped by 7.6% in the Columbus MLS during the month of July 2016. This comes as a surprise to both economists and Realtors, who predicted solid growth for the rest of the year.
Why did the Columbus Real Estate Market fall off a Cliff?
Here are a few reasons for the decline:
- Low Inventory There are more buyers than sellers and home builders are not catching up with demand.
- The Chicken and the Egg Problem Many owners tell me they don’t want to list their home, because they can’t find a new one.
- Low Appraisals Quite a few contracts fall apart due to low appraisals. As home values have increased by 5.5% this year and buyers offer more than asking price, it is not unusual for appraisals to come in below contract price.
- Holidays in July This year July started on a Friday. There were 5 weekends in July, including Independence Day, which left us with only 19 business days for the month.
A Shift in the Market?
Comparing year over year home sales, it appears that the housing market shifted by 1 month (early).
Suburbs in popular school districts experienced a huge drop in home sales in July (more than 10%). The rest of Central Ohio saw an increase.
Closed Sales vs. New Listings
This chart compares closed sales (red) and new listings (green), and how they changed between July 2016 and the same month last year. I only included districts with 100 new listings or more.
On the bottom of the list is Gahanna Jefferson. Closed sales were 21.6% lower than a year ago, however, new listings increased by 23.3% in July.
While closed sales dropped everywhere but Hilliard and Pickerington, Pickerington is the only place where both closed sales and new listings increased.
The Entire MLS line shows how closed sales have decreased by 7.6% in July (as reported last week) while new listings hardly changed at all (-0.80%).
How Quickly Do Homes Sell?
Two good indicators for how quickly homes sell are Days on Market (DOM) and Months Supply.
DOM counts the average number of days it takes to get a listing into contract.
Months Supply tells you how soon the current inventory would be sold, if no new listings were added.
Hilliard is lowest in both categories. This indicates that homes sell the quickest in this school district.
July 2016 Columbus Housing Stats
Home Sales dropped by -7.6% to 3,070 units (compared to July 2015).
Home Values are up by 4.1% with an average sales price of $213,809.
Days on Market decreased to 33 in July. That’s 10 days shorter than in June 2015. The supply is now at 2.4 months.
The Inventory is slowly rising. 6,402 homes are listed for sale. That’s still 19.2% lower than last year.
You can download the complete July housing report and all local housing reports at Columbus Realtors.