2022 is continuing to tell a different story than the last two years. As we see interest rates increase substantially, we are watching sales slowing and real estate inventory climbing. Our real estate market was pegged so far into a seller’s market, we have a ways to go before the buyer has the advantage. Although, in this current climate, that may be coming sooner than we have been expecting.
Real estate inventory doubles
As of June 23, 2022, there are 360 residential properties for sale in Summit County. In late June last year, there were only 170 residential properties for sale. We have more than double the inventory there was last year. Really, the huge increase has happened over the last three months. 250 properties have been added to the residential inventory since April 1st, actually tripling the number of homes for sale. Summer is our typical selling season so it’s not unusual to see lots of homes come on the market in anticipation of the summer buyers. In fact, in 2019, we saw inventory increase by around 200 homes in the same three month span. The question now is will the buyers be here this summer.
Slower real estate sales
In the month of May, 117 home sales closed in Summit County. That was a 31% decrease from last May. It was still a 25% decrease from the pre-pandemic May of 2019. In fact, May 2022 had fewer sales than any May since 2012.
Interest rates were rising at a good clip in April which may have contributed to slower sales. They have since gone even higher. June sales may give us some indication how potential buyers are responding to interest rates and other economic factors. Sales are already looking slower than typical but with a week to go, it’s just speculation at this point.
A buyer’s market?
Does this rise in real estate inventory and slowing sales signal a buyer’s market on the horizon? Perhaps. Our seller’s market has been so strong that even with real estate inventory doubling when compared to last year, we are still in a seller’s market. I would love to see 700 properties for sale in the county at any given time. Even more would be ok too. There were 700 homes for sale during the summer of 2020 and 2019. Before that, it was 2015 since we exceeded 700 homes for sale. We were transitioning then from a buyer’s market to a seller’s market. If we can get to 700 again, it may signal the beginning of a transition back towards a buyer’s market. We need to double our real estate inventory again to get to that level. Weak summer sales could make that come to fruition yet this summer. However, I don’t anticipate a buyer’s market in the cards for 2022.