DAVENPORT, IA – The first half of 2017 saw a record number of homes sold and closed in our region. In the Quad Cities, for example, the Multiple Listing Service (MLS) had the most sales closed from January through June that we have had since 2000 – a 17-year high (See Mid-Year Comparison Chart – attached).
Our Regional Activity Chart, also attached, shows the sales increases in all of our markets. Overall, sales volume in the region compared to last year is up 12%, with some top performers being the Dubuque Area – up 20%, and the Iowa City and Muscatine/Wilton Areas both up 15%.
Home Prices Appreciating More
All of our regional Metropolitan Statistical Areas (MSAs) experienced a positive gain as price appreciation in our region over the past 5 years was between 7.25% and 12.91%. Specific appreciation rates by MSA are attached. In the past year, according to the Federal Housing Finance Agency (FHFA), prices are up 2.35% in Dubuque, 2.47% in Iowa City, 3.62% in the Quad Cities and 2.35% in Cedar Rapids. This compares to a 6% increase nationally. The National Association of Realtors (NAR), warns of an affordability crisis in many markets due to the rapid appreciation in home prices. Luckily, our region continues to be one of the most affordable in the country.
Note: There is considerable variation in price appreciation based on price range and location of properties, with more affordable properties appreciating more due to higher demand and lower inventory.
Low Interest Rates Fueling Sales
Low interest rates also help affordability. On July 17, rates with no points were as follows:
15-year conventional fixed 3.250%
30-year conventional fixed 3.875%
FHA/VA 30 year fixed 3.875%
5/1 ARM (Adjustable Rate Mortgage) 3.250%
Buyers can buy more house for the same monthly payment now, than they will be able to buy in 2018 when interest rates will be higher.
Inventory Still Falling
The number of homes for sale is alarmingly low – down another 8% in the region compared to last summer. In the Quad Cities, listings are at their lowest levels in 17 years. This makes now the best time ever for sellers to sell at top dollar. It is a real challenge for buyers of affordable homes to find and negotiate an acceptable offer on a property. Homes are selling fast and some receive multiple offers and/or sell over list price. It is possible that this shortage of affordable inventory may lead to a slowdown in housing sales. Investors have been a mixed blessing to Realtors. We love to sell them income properties and help them create wealth. However, a new study by Andrew Waite reports that investors now own over 20% of all one to four family homes in the US. So that inventory is no longer available to homebuyers.
About Ruhl&Ruhl Realtors
A family-owned company since 1862, Ruhl&Ruhl Realtors has grown to over 330 sales associates, 61 employees and twelve offices, selling more than 5,000 homes in eastern Iowa, northwest Illinois and southwest Wisconsin. The company has residential sales offices in Bettendorf, Burlington, Cedar Rapids, Clinton, Davenport, DeWitt, Dubuque, Iowa City, Maquoketa and Muscatine, Iowa; and in Moline and Galena, Illinois. In addition to residential sales, the company offers services in relocation, property management, real estate investments, new home sales, land development, farm and land sales, senior services, home vendor services, insurance services and mortgage services. For more information on Ruhl&Ruhl Realtors, visit their website at www.RuhlHomes.com.