Are Homebuyers Today Grossly Overpaying for Homes and Making Decisions They’ll Regret?

I’ve been in the real estate business since I was 17, which means it has been 45 years of experiencing various market conditions, including recessions, inflation, 18% mortgage rates, the burst of the housing bubble, and a myriad of other good and bad things. However, I can confidently say that I have never witnessed a real estate market quite like the one we have been experiencing in the past couple of years.

So, what makes the current real estate market so unique?
First and foremost, I’ve pondered this question extensively, and I honestly can’t recall a time in this industry when the supply of homes for sale was not at least 4 to 6 months’ worth. Although there was a brief period in 2015 when the inventory of homes in St. Louis fell below 4 months, it quickly returned to nearly 5 months. From 2016 until early 2020, the inventory fluctuated between approximately 2 and 3 months, and then began a downward trend, hitting a record low of less than a 1-month supply in the latter part of 2021. While the supply has slightly increased since then, it still hovers around 1 month.

Months of Inventory – St Louis 5-County Core – 2013 – 2023

This situation showcases the basic law of economics—supply and demand. The supply of homes for sale in St. Louis is exceptionally low, and even though the number of home buyers in the market has seemingly declined significantly over the past few years, there still isn’t enough supply to meet the demand of the remaining buyers. Consequently, in accordance with the law of supply and demand, prices tend to rise when supply is insufficient to meet demand. While it’s easy to increase widget production to meet demand, it’s not as simple to suddenly add thousands of homes to the market in the St. Louis real estate market. Factors such as a lack of available land for development in high-demand areas, lengthy approval processes for new developments, labor shortages in the trades, difficulty in controlling construction costs, and the significant time required to bring a substantial number of homes to the market contribute to this complexity. As a developer, I can attest that the development process is lengthy enough for the market dynamics to change entirely before the first home hits the market.

So, where did all the houses go in St Louis?  Why aren’t there more homes for sale?

St Louis Home Mortgage Originations Drop To Lowest Level In Over 23 Years

This might not come as a surprise, given that St. Louis home sales experienced a nearly 20% decline in the past 12 months compared to the previous year, coupled with 30-year fixed-rate loan interest rates approaching 7%. However, mortgage loan originations in St. Louis during the first quarter of this year have reached their lowest level since ATTOM Data began tracking them in the first quarter of 2000. As depicted in the chart below, both home purchase mortgages and total mortgage originations (including purchases and refinances) hit record lows in the first quarter of this year.

During the first quarter, the St. Louis MSA recorded 4,733 mortgage originations, marking a 45% decrease from the previous quarter’s 8,666 originations, and a 54% decrease compared to the same quarter in the previous year when 10,410 mortgages were originated for home purchases

St Louis MSA Mortgage Originations Q1 2000 – Q1 2023 (Chart)

St Louis MSA Mortgage Originations Q1 2000 - Q1 2023 (Chart)

National Association of REALTORS and Big Brokerages Dealt Another Blow In The Moehrl Class Action Lawsuit Today

Today, the U.S. Court of Appeals for the Seventh Circuit denied a motion by the National Association of REALTORS® (NAR) and other defendants in the Moehrl v. The National Association of Realtors lawsuit. The motion sought to appeal the decision certifying this case as a class action lawsuit. As a result of this denial, the lawsuit will be allowed to proceed.

Click here or on the image below to see the full ruling.

United States Court of Appeals for the Seventh Circuit decision on the NAR motion to appeal the class action certification in the Moehrl v National Association of Realtors lawsuit.


St Louis Home Prices Have Increased by 112 Percent Since 2000; Rental Rates Rise by 68 Percent

As the infographic below illustrates (which is available exclusively from MORE, REALTORS®) the median price of a home in St Louis (the 5-county core market) has increased 112% since 2000, from $124,900 in 2000 to $265,000 in 2022.  During the same time period, the median lease rate, or rental rate, for a St Louis home has increased by just 68%, moving from $955 in 2000 to $1,600 in 2022.

Leasing a home is obviously a better deal, right?

If we set aside the benefits (and responsibilities) of homeownership and the long-term investment aspects, simply looking at the monthly cost might lead us to the conclusion that renting a home in St. Louis could likely save us money compared to buying one. After all, if we just consider the fact that during the aforementioned 22-year period, the cost of buying a St. Louis home increased by nearly 65% more than the cost of leasing one, we would certainly lean towards that conclusion. However, if we account for interest rates, which impact the monthly cost of owning a home (assuming financing is involved), we find that the gap significantly narrows. This is because even though interest rates are higher now than they were just a year or two ago – in fact, roughly double – they are still lower than they were in 2000.

Factoring in interest rates, the gap between buying and leasing narrows significantly.

In 2000, interest rates for a 30-year fixed rate mortgage varied but averaged roughly 7.5%. In contrast, they were around 6% in 2022. As the infographic shows, when we take these rates into account to assess the monthly cost of owning a home, we observe that even though home prices have risen by 112% since 2000, the house payment on a median-priced home has only risen by 82%. While the increase in house payments at 82% is still greater than the 68% increase in leasing, the gap is much smaller. Once other benefits of homeownership are factored in, it becomes easier for many people to justify the additional cost of ownership.

To clarify, I am not claiming that homeownership is for everyone or that leasing is inherently inferior. In fact, I’ve been one of those people who have consistently said that homeownership isn’t for everyone. For many individuals, based on factors like their likelihood of relocating, job and financial stability, money management skills, and others, leasing can be a better alternative. I am simply trying to highlight that the cost gap between the two options may not be as wide as it initially appears.

St Louis Real Estate Market Report – April 2023

Below is our St Louis Real Estate Market Report for April 2023 for the City and County of St Louis combined.  You can access the full infographic, containing data for St Charles, Jefferson and Franklin Counties as well by clicking on the image below.

St Louis Real Estate Report for April 2023

(click on infographic for complete report including other counties)St Louis Real Estate Report for April 2023

St Louis New Home Building Permits For The Past 12-Months Declined in 6 of Seven Counties

There were 3,920 building permits issued for new single-family homes in the St Louis area during the 12-month period ended March 31, 2023.  This represents a decrease of 16.58% from the prior 12-month period, during which 4,699 permits were issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri (St Louis HBA).   Six of the seven counties covered in the report saw a decline in building permits from the previous period, with five of them experiencing double-digit declines.  In contrast, Franklin County saw an increase of over 4%, marking the 20th consecutive month of increases.


St Louis New Home Building Permits – March 2023

(click on table below for page with live charts showing additional permit data)St Louis New Home Building Permits - March 2023


Why Most Sellers Should Ensure Their Listing is in the MLS and Not “Office Exclusive”

First and foremost, let me emphasize that home selling methods and practices are not a “one size fits all” approach. There are certainly situations where a different or unique strategy is required, including, in extreme cases, one that may not be in the seller’s best financial interest but favors a higher priority for the seller. For instance, I once handled a home sale for a woman with a stalker ex-husband who wanted her home sold discreetly – no sign, no ads, no MLS, etc. In her case, privacy and conducting the sale “under the radar” for her personal safety were more important than money. This article addresses the broader market and my opinion will apply to most sellers looking to sell their homes.

Now, let’s discuss an “office exclusive” listing.

Off Market Listings - Vest Pocket Listings

Understanding this concept is a great starting point and highlights one of the reasons I’ve been writing articles about St. Louis real estate, St. Louis REALTORS®, and the St. Louis real estate industry. I believe that, in general, consumers lack sufficient knowledge about these matters to make the best choices for themselves when selecting agents to work with. As a result, I aim to share the insights I’ve gained from over 40 years in the industry. For example, most non-agent readers may not know what an “office exclusive” listing entails or whether it’s advantageous or disadvantageous for them as sellers. So, what is an office exclusive listing? In short, it’s a listing that the agent will “keep secret” to a large extent, only informing agents within their real estate brokerage and withholding your listing from the REALTOR® Multiple Listing System (MLS). Consequently, your listing will not be distributed to the thousands of websites that obtain listing information from the MLS (Zillow, and to name a few).

Wait, my listing won’t be in the MLS??

When will the St Louis real estate market crash?

What strange and confusing times we live in! Some seemingly credible predictions made by qualified experts suggest that our banking system could collapse, our currency may become worthless, and our country may face a significant downturn. Meanwhile, others claim that there is no cause for alarm. Here in St. Louis, the real estate market continues to thrive as if everything is great in our economy, despite the fact that interest rates have doubled in the past year. I have been in this business for 43 years, and although I have seen many ups and downs in the market, I have never seen anything quite like this before. It appears that there is a stark dichotomy between the economy and the St. Louis real estate market at present, as if they are two entirely separate entities. Could this be the result of the low inventory and high demand for housing, leading homeowners to throw caution to the wind? Or is it possible that the St. Louis economy is stronger than the national economy? Whatever the reason may be, despite talk at the national level of a looming housing market crash, the St. Louis real estate market continues to thrive.

Is the St Louis real estate market going to crash?

Now, onto the question of whether the St. Louis real estate market is going to crash. This is a fair question, given the current issues outlined above. However, so far, there are no clear signs of a crash. That’s not to say that there won’t be any changes to the market, as I believe we’ll see some, but nothing that indicates a crash is imminent at this point. Almost a year ago, I wrote an article in which I stated that “I don’t think St. Louis home prices will come crashing down, in fact, I don’t even think they are going to decline necessarily.” This prediction has proven to be accurate. However, I also said in that same article that “I think the premiums buyers have paid over and above the value of the home they were buying are going to quickly come to an end,” and this has proven to be inaccurate.

Despite my prediction, there are still bidding wars happening between buyers on new listings. The STL Market Chart table below shows that last month, the median price of homes sold was equal to 100% of the current list price at the time of sale. Given that the median is indicative of the midpoint of the frequency of values, if the midpoint is 100%, then it appears that plenty of homes are selling in excess of the list price.

The data for the St. Louis real estate market shows that there is a strong buyer demand. In addition, the market is facing the persistent issue of low inventory. These factors have contributed to the resilience of the St. Louis housing market, making it unlikely to succumb to a crash at this point. However, if there is increased economic uncertainty, inflation, and rising interest rates, we may reach a tipping point and see St. Louis home prices decrease. Despite this possibility, it is unlikely to happen anytime soon based on current data.

A new twist on lending…The cost of a home loan will go down for bad credit scores and increase for good credit scores…

The headline of this article is not clickbait nor sensationalism. In fact, it’s based on something that’s about to happen. Fannie Mae, which, along with Freddie-Mac, is involved in almost two-thirds of the home loans in the United States, is set to release a new Loan Level Price Adjustment Matrix (LLPA) on May 1, 2023. The LLPA is used by lenders to determine the cost (interest rate) of a loan for a borrower, and it’s not entirely new, as there’s an existing one already in effect. The new LLPA is similar to the current one, as it also charges varying amounts based on the loan to value (LTV) and credit score.

What’s different in the new LLPA is that the cost is going up for borrowers with better credit and going down for borrowers with a lower credit score. To explain briefly how LLPA works, the higher the percentage of the purchase price a borrower is borrowing, the higher the fee. This percentage is known as the “LTV.” It makes sense that a loan where the borrower made a smaller down payment (e.g., 3%) has more risk associated with it than a loan where the borrower made a 20% down payment. Furthermore, the higher the credit score a borrower has, the lower the fee will be. This is because credit scores are based on past payment performance, and it’s logical that there’s less risk to a lender for a mortgage where the borrower has a higher credit score.

Borrowers with a higher credit score will still get better rates:

It’s essential to point out that Fannie Mae hasn’t entirely lost its mind by charging higher-risk borrowers less than it’s charging lower risk borrowers. For instance, a borrower with a 740 credit score borrowing 95% or more of the purchase price will be charged a 0.125% LLPA fee come May 1st, while a borrower with a 630 credit score borrowing the same amount will pay a cost of 1.75%. So, the borrower with the worst credit score will pay an LLPA fee approximately 14 times higher than a borrower with the best credit score.

So what’s the big deal then, what’s different?

The headlines surrounding this change relate to how Fannie Mae has adjusted its current pricing. The change appears to punish better credit risk borrowers and reward higher risk borrowers. For example, a borrower making a 20% down payment with a high credit score will be charged higher rates come May 1st. In contrast, a borrower with the same down-payment but a lower credit score will get charged a lower rate than the current one. Currently, a borrower with a 740 credit score is charged a 0.50% LLPA fee, but beginning May 1st, that charge will go up to 0.875%. However, a borrower with a credit score of 639 currently is charged 3.0%, and on May 1st, that will drop to 2.75%.

Some high credit, strong borrowers will benefit, but overall the winners are borrowers with the worst credit scores…

Report Says U.S. Home Prices Dropped 3% in March, the Biggest Annual Decline in Over a Decade; However, This Was Not True in St. Louis

A report released today by Redfin reveals that the median U.S. home sale price in March was $400,528 marking a 3.3% decline from March 2022 when the median home price was $414,196. However, the situation in St. Louis is quite different. According to the STL Market Chart (available exclusively from MORE, REALTORS®) below the median price of homes sold in St Louis in March was $260,000, which represents an increase of 4% from March 2022 when the median home price was $250,000.

The chart also depicts the 12-month home sales trend for St. Louis, indicated by the dark green line, which shows a decline since September 2021. During the 12-month period ending on September 30, 2021, there were 30,728 homes sold in the 5-County Core St. Louis market. However, this has fallen monthly, reaching 24,577 for the 12-month period ending last month.

St Louis 5-County Core Market Home Prices and Sales Trend

Click on the chart for a live, interactive chart.
St Louis 5-County Core Market Home Prices and Sales Trend

Why an online auction may be the best way to buy or sell a home in St Louis

Recently I wrote a lengthy article about various current issues that are likely to bring significant changes to the real estate industry. These changes will also affect the process of buying or selling a home for consumers. Although I may be in the minority within the industry, I strongly believe that most, if not all, of the changes will benefit both consumers and real estate professionals.

One of the first changes that may happen is the elimination of the requirement for sellers to pay the commission to the buyer’s agent in order to list their property in the REALTOR® MLS system. Although sellers can still choose to pay buyers’ agents, the process will become more transparent for all parties involved.

Nearly two years ago, our brokerage, MORE, REALTORS® created an online real estate auction site called to provide an alternative for buyers and sellers that addresses many of the issues raised in class-action lawsuits and the investigation by the Department of Justice. The auction platform was designed to offer a transparent and fair process for both parties while ensuring that they still have the option to be represented by real estate professionals. Moreover, sellers do not have to pay the buyer’s agent’s commission, and they can even use the auction platform without paying any commission at all.

What are the benefits of selling your home on

  • Transparency: The auction process is transparent and open to all potential buyers, ensuring a fair market value for the property.
  • Competitive bidding: Auctions generate competition among buyers, often resulting in higher sale prices than traditional listings.
  • Control: The seller has more control over the sale process, including setting the reserve price and choosing the auction date.
  • Reduced holding costs: Since the sale process is typically faster, the seller can avoid paying holding costs such as property taxes, utilities, and maintenance fees for an extended period of time.
  • Convenience: Online auctions can be conducted from anywhere, allowing sellers to avoid the hassle of in-person showings and open houses.
  • Increased exposure: Online auctions can attract a wider audience of potential buyers from all over the country, increasing the chances of a successful sale.

What are the benefits of buying a home on

  • Transparency is key in the auction process, as it ensures that all potential buyers have an equal opportunity to make a purchase. This means that you won’t lose out on a property simply because of the timing of your offer, or because you chose not to include a letter to the seller. Furthermore, the open and transparent nature of auctions ensures that you won’t be outbid by another purchaser who offers different terms than yours. Overall, the transparency of the auction process promotes fairness and equal access to all potential buyers.
  • You’re the one in control during an auction. Unlike in a traditional real estate transaction where the listing agent or seller has the final say on which buyer to accept or which escalation clause to activate, the decision to purchase the property is entirely up to you. You have the power to keep bidding if you want to, and you also have the power to remove yourself from the equation if the bidding gets to a point where you are no longer interested. Essentially, you are in control of the entire process and can make decisions based on your own preferences and priorities. By taking control of the situation, you can feel confident that you are making the best decision for yourself and your future.

If you would like to learn more about buying or selling a home, condo, or other property at auction, please don’t hesitate to contact us by clicking the button below. Additionally, you can find additional resources and information below to help you get started.

St Louis Real Estate Market Report

Below is our St Louis Real Estate Market Report for March 2023 for the City and County of St Louis combined.  You can access the full infographic, containing data for St Charles, Jefferson and Franklin Counties as well by clicking on the image below.

St Louis Real Estate Report for March 2023

(click on infographic for complete report including other counties)St Louis Real Estate Report for March 2023

Do you need a buyer’s agent when buying a home in St Louis?

Earlier this week I wrote an article addressing some of the current issues that will likely significantly impact the residential real estate business.  IIn the article, I suggested that, as a result of the various challenges to present-day practices, sellers may no longer be required to pay commissions to the buyer’s agent in the near future.  Does this mean the role of the buyer’s agent in a transaction is going away and that buyer’s agents are not needed?  The short answer is no, buyer’s agents are not going away.

So, buyer agents won’t be impacted by these changes?

Wait, I didn’t say there no impact or effect on buyer’s agents, I said, generally speaking, they are not going away. However, this doesn’t mean that there won’t be real estate agents leaving the profession as a result of not being prepared, able, or willing to deal with the changes. Some agents will leave the profession because, quite frankly, with the change in the way buyer’s agents are compensated, they will find that there are not enough people who see value in paying them to represent them. I know this sounds a little harsh, but I’ll explain what I mean in more detail below.

The bar will be raised…

While my earlier statement sounds a little harsh, I think the reality is that agents that are not committed to this profession, lack the knowledge and skills they should have and don’t deliver the level of representation and service they should to their clients, are going to find it hard to survive in the business in the near future. As transparency increases on how buyer’s agents are compensated, particularly when it becomes known that the compensation is either coming directly from their buyer client or indirectly from them, buyers are likely to be more selective about the agents they choose to work with. Some may argue that buyers may opt to forego having a buyer’s agent and deal directly with the listing agent instead to save some money. I will address that in more detail later, but for the most part, I don’t think that will be the case. Instead, good agents, those who know this business and the market and are true professionals with their clients’ interests at heart, will be rewarded.

How the real estate industry is going to be turned upside down and why sellers may no longer have to pay buyer agents

Let me begin by saying that I’m not a sensationalist, nor am I an advocate for everything I write about.  Additionally, I am not an attorney, so this not a legal opinion.  I am simply a real estate broker that has been very active in the profession and industry for over 40 years now.  I strive to stay on top of industry and market changes so that the agents in our firm, MORE, REALTORS®, and their clients can avoid surprises and be prepared.  Another reason I do this is to share what I have learned with consumers.  I believe that by sharing good, relevant and accurate information to consumers, they will be equipped to make better decisions when it comes to buying or selling real estate, including how to choose an agent to best represent them.

The real estate industry is about to be turned upside down as a result of class action lawsuits against the National Association of Realtors So, what is going to turn the real estate industry upside down?

Yes, I made a rather bold statement in my headline, but I believe it to be an accurate depiction of what is coming to the world of residential real estate, including right here in St Louis.  The source of this disruption is not a single entity, but rather many.  While there is a common theme to the multiple threats, they are coming from different sources.  Over the past few months, I have written about all the issues I’m referring to, so below is a summary of them and links to the original articles:

  • Moerhl v NAR Lawsuit. 3/22/2019 – This suit was filed against The National Association of REALTORS® (NAR), Realogy Holdings Corp, HomeServices of America, Inc, Re/Max Holdings, Inc and Keller Williams Realty, Inc.  The suit alleges that the defendants were “conspiring to require home sellers to pay the broker representing the buyer of their homes, and to pay at an inflated amount, in violation of federal antitrust law.”  At the heart of this claim is the NAR rule that requires sellers to offer compensation to the buyer’s agent in order to be eligible for listing in the MLS.
  • Department of Justice (DOJ) Complaint against NAR. 12/01/2020.  The DOJ filed a complaint against NAR, as well as a settlement agreement, focused on two primary issues; 1. Allowing buyer brokers to misrepresent to buyers that a buyer broker’s services are free; 2.Enabling buyer brokers to filter MLS listings based on the level of buyer broker commissions offered and to exclude homes with lower commissions from consideration by potential home buyers;


Continue reading “How the real estate industry is going to be turned upside down and why sellers may no longer have to pay buyer agents

Two of the Three Fastest Growing Missouri Counties are In the St Louis Metro Area – So is the 3rd Fastest Shrinking One

According to the U.S. Census Bureau’s 2022 estimates of population and components of change report released yesterday, Lincoln County was the Missouri county that experienced the highest percentage gain in population from 2020 – 2022.  As the list below shows, Lincoln County saw a 6.0% increase in popular during the period from 2020 to 2022, with Wright County coming in 2nd at 5.3% and another St Louis MSA county, Warren County, coming in 3rd on the list with a 4.8% increase in population.

At the other end of the list was the City of St Louis which saw a 5.0% decline in population during the period giving it the rank of 113 of the 115 counties in Missouri that were ranked.

Missouri Population Change 2020-2022 By County

Top 10 Counties by Percentage Growth In Population

(click on list to see entire list showing all Missouri Counties)

Missouri Population Change 2020-2022 By County

Access the complete list HERE.

St Louis New Home Building Permits in February Fall By Double-Digits From A Year Ago In Four of Seven Counties

There were 4,170 building permits issued for new single-family homes in the St Louis area during the 12-month period ended February 28, 2023, a decrease of 10.69% from the same period a year ago when there were 4,669 permits issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri (St Louis HBA).   Six of the seven counties covered in the report saw a decline in building permits from the same period a year ago with four of them experiencing double-digit declines.  Franklin County, on the other hand, saw an increase of nearly 19%.


St Louis New Home Building Permits – February 2023

(click on table below for page with live charts showing additional permit data)St Louis New Home Building Permits - February 2023


Do the Fed Funds rate and M2 money supply really matter to the St Louis real estate market?

For the past several months there have been many reports anticipating the moves of the Federal Reserve regarding interest rates then followed by tons of articles, blog posts and videos analyzing then predicting the impact of the Fed’s decision on the economy.  The other popular topic in this area is the “Money Supply”, usually M2 money supply and whether it’s increasing or decreasing as well as the impact on the economy.

Should St Louis homeowners and potential home buyers really care about the Fed Funds rate or M2 money supply?

First, let’s talk about the Fed Funds rate and what it is, what it is intended to do and the affect it can have on the real estate market.  The Fed Funds rate is the interest rate at which banks lend to each other overnight to maintain their reserve requirements. This rate is set by the Federal Reserve, and changes to the rate can have a ripple effect throughout the economy, including the mortgage and housing markets. When the Fed lowers the Fed Funds rate, it can stimulate economic growth by making it cheaper for banks to borrow money, which can lead to lower mortgage interest rates. Lower mortgage rates make it more affordable for homebuyers to finance their purchases, which can increase demand for homes and drive up prices. Conversely, when the Fed raises the Fed Funds rate, it can lead to higher mortgage interest rates, which can slow down the housing market and lead to lower demand and prices.

Next, the the M2 money supply.  The M2 money supply includes cash, checking accounts, savings accounts, and other liquid assets that can be easily converted into cash. When the M2 money supply increases, it can stimulate economic activity by making more money available for borrowing and spending. This can lead to lower mortgage interest rates as well, as banks have more funds available to lend out. However, if the M2 money supply increases too rapidly, it can lead to inflation, which can cause mortgage interest rates to rise.

So, as you can see, both the Fed Funds rate and M2 money supply can have a significant impact on the cost of a home mortgage as well as home prices so I would say the answer to the question I posed is “yes”.  Granted, we don’t all need to become economists or stay up late at night pouring through spreadsheets and date, but to be aware of factors that affect the economy as a whole and as a result, the real estate market we’re in, would be wise.

How can knowledge of the Fed Funds rate and M2 money supply help me as a home seller or buyer?

The short answer is, it gives you a little insight into perhaps where things are headed which may help you make the decision to buy or sell sooner or later. For example, perhaps  you are contemplating buying an home but anguishing over the fact the mortgage interest rates are double what they were a year or two ago and you’re thinking maybe you should wait until things settle down.  Well, if you see the Fed Funds rate getting increased with talk of more increases while that is no guarantee mortgage interest rates will increase as well, as I explained above, it’s certainly an indicator that is a likelihood.  Therefore, you may decide it’s better to make a move now than later.

What’s an easy way to track this stuff?

I have the answer for you.  The charts below are two of the many charts and other information available on St Louis Real Estate Search as well as from MORE, REALTORS® .  The first chart shows the relationship historically between St Louis home prices and the M2 Money Supply.  Generally, they follow the same trend but, when the trend for one changes, like it did with St Louis home prices (the red line on the chart) beginning in the late 90’s through the housing market bubble burst after 2006, something happens to bring them back in line.  As you can see, starting a little over 3 years ago the pace at which M2 was growing outpaced St Louis home prices, but St Louis home prices quickly caught up. Now it’s the opposite and it looks like both a making a downward correction.

The bottom chart shows the close relationship between the Fed Funds rate and mortgage interest rates.  With little exception, when the Fed Funds rate increases or decreases, mortgage rates follow. For the past year, the Fed Funds rate has increased and the trend is upward so I wouldn’t expect to see falling mortgage interest rates anytime soon.

Missouri State Assistance for Housing Relief (SAFHR) Can Help Homeowners Struggling To Make Their Payments

The State of Missouri received $138 million from the U.S. Treasury’s Homeowners Assistance Fund (HAF) and are using those funds to help qualified homeowners that are struggling to make their house payments.  Missouri State Assistance for Housing Relief (SAFHR) is responsible for paying out these funds to help individual homeowners.

Who is eligible for assistance from SAFHR?

According to the SAFHR program guidelines, to qualify for SAFHR for Homeowners assistance, an individual or household must:

  • Earn no more than 150% of the area median income for the region where the property is located, as set forth in the HUD income guidelines for the St Louis metro area.
  • Have suffered a COVID-19 pandemic-related hardship that began on or after January 21, 2020, such as a loss of income or increase in household expenses related to the pandemic.
  • Require assistance with mortgage arrearage.

There are also 5 questions that, can answer “yes” to all of them, you are encouraged to submit an application to receive  Missouri State Assistance for Housing Relief (SAFHR) funds:

  1. Has your household experienced a financial hardship related to the COVID-19 pandemic since January 21, 2020?
  2. Are you a current resident of Missouri?
  3. Is the property you are seeking assistance for located in Missouri?
  4. Do you live on the property (primary residence) for which assistance is being requested?
  5. Do you have a mortgage on your home?

How do I apply for  Missouri State Assistance for Housing Relief (SAFHR)?

Well, if you appear to be eligible for assistance, the next step would to to register on the SAFHR site and complete an application. To access the registration form on the SAFHR site click here.

Mortgage Assistance Counseling is available as well.

As part of the SAFHR program, the Missouri Housing Development Commission (MHDC) has partnered with Mortgage Assistance Counseling agencies across the state of Missouri.  These agencies can help you complete your application for the SAFHR for Homeowners Program as well as help connect you with other services to avoid foreclosure.  To access the list of Mortgage Assistance Counseling agencies in Missouri, including the Missouri counties they serve  click here.



Smart Home, Smarter Seniors

What happens when you pair up Ted Gottlieb, Certified Senior Advisor® (CSA®) that’s a real estate broker with a real estate broker (me) that’s Smart Home Certified?  You end up with solutions for older adults that allow them to live more efficiently, for longer, in their current home by increasing safety, security, accessibility and independence. Before I get to the Smart Stuff, let me explain what a CSA® is and how rare it is for a REALTOR® to also be a CSA®. Ted is the first, and only as of this article, in Missouri to achieve this.

A Certified Senior Advisor® (CSA®) is a professional who has obtained a credential demonstrating expertise in the issues and concerns that affect seniors. These professionals are trained to provide guidance and support to seniors and their families in a variety of areas, including healthcare, financial and estate planning, and housing. This is rigorous training that allows the recipient to be well-versed in the complex issues that seniors face while avoiding conflicts of interest. 

So how do we use Smart Home technology to better serve seniors? Here are a few of the numerous benefits for seniors:

Safety and security: Smart home devices such as smart locks, cameras, and motion sensors can help seniors feel more secure in their homes by alerting them to potential security risks and allowing them to monitor their home remotely.

Comfort and convenience: Smart thermostats, lighting, and other devices can be programmed to adjust automatically to the user’s preferences, making it easier for seniors to stay comfortable and maintain their daily routines.

Accessibility: Smart Home technology can make it easier for seniors with mobility or vision impairments to control their home environment, such as using voice commands to turn on lights or adjust the thermostat.

Health monitoring: Smart home devices can track seniors’ vital signs, remind them to take medications, and even alert caregivers or emergency services in case of a medical emergency. There are even devices that will automatically dispense medications at a preset time of day.

Independence: By enabling seniors to control their home environment more easily, Smart Home technology can help them maintain their independence and stay in their own homes for longer.

Overall, Smart Home technology can be a valuable tool for seniors to enhance their safety, comfort, and quality of life. Trust and peace of mind matter so consider allowing the region’s first and only two brokers, with the specialized knowledge necessary, help your senior live smarter and more efficiently. If you’re not a senior, we can still help you prepare your current home for when you become a senior or get you into the right home now so you can live out your days more conveniently. The sooner you learn this technology the better. None of us are getting any younger…

John Donati, Smart Home Certified St Louis Realtor
About the author…
John Donati, REALTOR®
Smart Home Certified
Accredited Buyer’s Representative (ABR®)
Military Relocation Professional (MRP)
Ted Gottlieb, Certified Senior Advisor (CSA)
About Ted…
Ted Gottlieb, REALTOR®
Certified Senior Advisor®
Seniors Real Estate Specialist®
Certified Seniors Housing Professional™
Certified Seniors Downsizing Coach ™

What (Most) Seniors Don’t Want You to Know

Note: I’m generalizing ……..

Seniors don’t want to leave their homes.  I can’t tell you how many times I’ve been told “I want to be carried out feet first”. 

For most, the thought of selling the home is overwhelming – often paralyzing. Maybe it’s the memories, the years of accumulated “stuff”, lack of energy or the fear of what comes next. No matter the reason, just like you and me, older adults want to be where they feel safe. Enjoying their “independence” – when many times they are anything but. 

So, it’s status quo until a life event happens – like the loss of a spouse, a fall, illness, a diagnosis. Still, many times the goal is to stay home, maybe with help (family member or paid companion) or not. 

This took me a while to figure out. Frankly, when I decided to specialize in seniors real estate (2011), I didn’t know what I was getting myself into. I related well to older adults and wanted to differentiate myself from the thousands of other agents so this seemed like the right path. What I didn’t count on was overwhelming desire to stay put. 

So I figured, if they are not ready to sell, why not help them stay put longer and safer. I earned an aging in place designation and promoted myself as the real estate agent who helped people stay in their homes longer. Brilliant! It didn’t help pay the bills, but boy did I sleep well at night. What I did come to appreciate was the seniors I met, helped, enjoyed, protected. I got paid in coffee, corn bread and good karma ….. and every so often I got to sell a home. 

I learned some things along the way that you might find helpful: Older adults are chiefly concerned with maintaining control and their legacy (David Solie); Some family members are well intended while others are anything but; The equity in the home can be essential to someone’s care and legacy (so selling to that seemingly nice person who’s willing to pay cash and close fast rarely benefits the home owner or the neighbors); Not having an estate plan is more expensive than having one; Hiring a care manager is money well spent; Finding the right senior living community the first time matters, and so much more. 

To the general public, I offer my older adult consulting and referral services without cost or obligation – really! To the licensed real estate professional, I offer my insight and mentorship, for the asking. 

What I crave is that we honor our elders and treat them with the respect they so richly deserve.  As the good books says, “love thy neighbor as thyself”. 

About the author…
Ted Gottlieb, REALTOR®

Certified Senior Advisor®

Seniors Real Estate Specialist®

Certified Seniors Housing Professional™

Certified Seniors Downsizing Coach ™


Licensed In Missouri since 2003 | MORE™, REALTORS® | 314.690.9922

St Louis Home Prices Increased At Twice The Rate Of Rental Rates From 2018-2022

Should I rent or buy a home in St Louis?  This is a question St Louis REALTORS® are often asked, especially in the past few years while homes appeared to be increasing weekly, there were often more than a dozen offers on a listing and generally the market seemed out of control.  Granted, some of that pandemonium has eased somewhat lately given the increase in interest rates and questions about the economy but the question still remains.  While there are many non-financial reasons people choose to buy their own home or condo versus rent, we’ll just look at the cost today.

Home prices increased at more than double the rate of rents…

As the chart below, exclusively available from MORE, REALTORS®, shows, the median price of homes sold in St Louis during 2018 was $178,800 and increased to $240,000 in 2022 for an increase of over 34% during the 4-year period.  The median rental rate of homes leased in St Louis during 2018 was $1,250 and increased to $1,450 in 2022 for an increase of 16% during the same 4-year period.  During this 4-year period the rate at which the price of St Louis homes increased was more than double the rate at which the rental rates of St Louis homes increased.

Factor in interest rates and the cost of home ownership increase and monthly cost of home ownership 

As the second chart below shows, mortgage interest rates during 2018 were in the mid-to upper 4’s and in the 6’s and even hit 7% during 2022 so this means in addition to home prices going up, payments went up even more.  For the sake of this comparison, we’ll use 4.7% as the rate for 2018 and 6.7% for 2022.  Therefore, the payment on a typical home in 2018 (principal and interest only based upon a 5% downpayment) would have been $881 per month and in 2022 increased by 67% to $1,471 per month.  So, while the actual price of a home increased 34% during the period the monthly cost of it, in terms of house payment, increased at nearly double that rate, 67%.  During the same period rents increased just 16% so the monthly cost of buying a home increased four-times as much.

St Louis Area Home Sales Down Nearly 17 Percent In Past 12-Months

There were 28,500 homes sold in the St Louis 5-county core market during the 12-month period ended February, 28, 2023 a decline of 16.80% from the prior 12-months when 34,256 homes were sold according to MORE REALTORS® exclusive STL Market Report below.  As the report below shows, the median price of homes sold in St Louis increased 7.62% during the same period.

While the supply of St Louis homes for sale is still historically very low, it has increased significantly over the past two years rising from under a 1-month supply to the current 1.64 month supply of homes currently active on the market in St Louis.

St Louis 5-County Core STL Market Report

(for the 12-month period ended February 28, 2023)

t Louis 5-County Core STL Market Report 

New Home Building Permits in January Fall By Double-Digits From A Year Ago In 4 of 7 St Louis Counties

There were 4,147 building permits issued for new single-family homes in the St Louis area during the 12-month period ended January 31, 2023, a decrease of 13.48% from the same period a year ago when there were 4,793 permits issued, according to the latest data from the Home Builders Association of St. Louis & Eastern Missouri (St Louis HBA).   Six of the seven counties covered in the report saw a decline in building permits from the same period a year ago with four of them experiencing double-digit declines. 


St Louis New Home Building Permits – January 2023

(click on table below for page with live charts showing additional permit data)St Louis New Home Building Permits - January 2023


A Smart Home is an Efficient Home

As the region’s only Smart Home Certified broker*, I’ve been asked many times how smart technology can benefit a homeowner’s energy usage so here are a few brief examples:

  • Energy Monitoring: Smart home devices such as smart thermostats, smart lighting, and smart appliances can help monitor energy usage and identify areas where energy is being wasted.
  • Automated Energy Management: Smart technology can automate tasks such as adjusting thermostat settings and turning off lights and appliances when not in use, thereby reducing energy consumption.
  • Energy Efficiency: Smart devices can optimize energy usage by adjusting heating and cooling systems based on occupancy and outside temperature, helping to reduce overall energy usage.

The easiest way to better understand the Smart Home world is by contacting me. Allow my specialized knowledge and training in Smart Home technology benefit you in selecting the right products and systems for your needs. Additionally, when it comes to selling your home, I’m uniquely qualified to position your property in the marketplace so buyers understand the value of the tech your house has. As a buyer, I can help you better understand how to maximize the potential of any existing technology in a home and how to integrate new technologies to help your home function more efficiently.

Smart home technology can be complex and overwhelming for homeowners to navigate on their own, but it doesn’t need to be that way. Having a Smart Home Certified broker on your side can simplify the process and ensure that you get the most out of your smart home investment. Reach out to me and I’m happy to answer your questions.

Interested in knowing MORE about Smart Home tech? Contact the only Smart Home Certified CRS agent in the Greater St. Louis area*.

*Based upon actual knowledge the author has at the time of publication.


St Louis Real Estate Market Report

Below is our St Louis Real Estate Market Report for February 2023 for the City and County of St Louis combined.  You can access the full infographic, containing data for St Charles, Jefferson and Franklin Counties as well by clicking on the image below.

St Louis Real Estate Report for February 2023

(click on infographic for complete report including other counties)St Louis Real Estate Report for February 2023

One in four St Louis city homeowners with a mortgage are underwater

Underwater Mortgage Photo

A new report just released by ATTOM Data revealed that nearly one of every four homeowners (24.3 %) in the city of St Louis that have a mortgage, are underwater on equity (meaning property owner owes at least 25% more on their home than the current value).  At the other end of the spectrum was St Charles County where just 3.9% of homeowners with a mortgage are underwater.

Below is a list of the larger counties in the St Louis MSA and the percentage of the mortgages in the respective county that was underwater during the 4th quarter of 2022:

  • City of St Louis, MO  (24.3%)
  • Saint Clair County, IL  (15.5%)
  • Madison County, IL  (13.4%)
  • Franklin County, MO  (10.5%)
  • St Louis County, MO  (9.7%)
  • Jefferson County, MO (8.1%)
  • St Charles County, MO (3.9%)


Where People In St Louis Came From and Went To Last Year

Allied Van Lines just released its Allied Magnet States Report which revealed that, across the U.S.,  fewer people moved in 2022 than in 2021.  The report shows the number of people moving to or from a State as well as for the metropolitan areas located in that state.  For last year, Missouri was considered a “balanced” state with the numbers of inbound and outbound movers being about the same at 52.3% and 47.7% respectively.  Our neighbor to the east, Illinois, didn’t fair as well.  Illinois was labeled as a “high outbound” state for 2022 with 66.1% of the moves being outbound and only 33.9% being inbound.

The most popular cities to move to St Louis from and the most popular cities to move to from St Louis.

According to the report, the city the largest number of inbound moves to St Louis were from was Chicago, IL and for the folks leaving St Louis and headed out of state the number one destination was Denver, CO.  The table below shows the top 5 cities where people move to from St Louis as well a the top 5 they moved here from.

Top 5 Cities Inbound Movers to St Louis Come From and Top 5 Cities Attracting St Louis ResidentsTop 5 Cities Inbound Movers to St Louis Come From and Top 5 Cities Attracting St Louis Residents




St Louis Home Loan Originations Fall to a 12-Year Low

During the 4th quarter of 2022, 7,622 home buyers in St Louis applied for a home mortgage according to the latest report from ATTOM Data. According to the report, this is the lowest number of mortgage applications in a quarter from home buyers in St Louis since the 1st quarter of 2011 when there were just 5,629 applications.  Mortgage applications to purchase a home peaked in St Louis in the 3rd quarter of 2005 when there were 18,002 applications.

As the chart below illustrates, the drop in St Louis homeowners refinancing their mortgage is even more dramatic.  During the last quarter of 2022, 4,208 homeowners refinanced their existing mortgage marking the lowest number for a quarter in St Louis since AATOM began tracking the data back in 2000.  The refinancing boom in St Louis was during the 3rd quarter of 2003 when 54,281 St Louis homeowners refinanced their mortgage.

HELOC’s (home-equity line of credit) are down in St Louis as well.  During the 4th quarter of 2022, 3,166 St Louis homeowners took out a HELOC compared with 15,317 that did so during the HELOC peak in Q3 2003.  HELOC’s hit their low point during the 3rd quarter of 2000 when just 356 were originated.

St Louis Mortgage Originations In St Louis – Q4- 2022

(click on chart for Live, Interactive chart)

St Louis Mortgage Originations In St Louis - Q4- 2022


FHA Loans Just Became A Little More Affordable

Today, the U.S. Department of Housing and Urban Development (HUD) announced a reduction in the mortgage insurance premium charged to borrowers on FHA loans.  The mortgage insurance premium is a charge over and above the interest on the loan that is the fee to HUD for insuring the loan.  Currently, the FHA mortgage insurance premium varies from 0.45% to 1.05% of the loan amount depending upon the loan term (15 or 30 years) and the LTV (loan to value).  Effective with FHA mortgages endorsed for insurance by FHA on or after March 20, 2023, the rate will be reduced by 0.30% across the board.

The table below shows the current charges for FHA mortgage insurance premiums for various loan terms and LTV’s as well as what the new charges will be.  On an FHA loan amount of $265,000 a borrower will have a monthly payment that is about $66.00 lower as a result of the reduction in mortgage insurance premiums.

FHA Annual Mortgage Insurance Premium (MIP) – Current Rates vs. New Rates

(click on table to see complete HUD press release)FHA Annual Mortgage Insurance Premium (MIP) - Current Rates vs. New Rates



St Louis Distressed Home Sales Trending Upward But Still Low

There have been a fair number of reports about the increase in distressed home sales in various markets around the country and on the national level.  However, in St Louis, distressed home sales are on the rise, they are still at levels that are historically quite low.

Distressed home sales that involve some sort of distress or other condition that would typically result in the home not selling for a normal “retail” price like it would if it were a typical listing in market ready condition with normal marketing time allowed.  The chart below shows distressed home sales in the St Lous 5-County core market over the past years and also shows the 12-month sales trend.  For our purposes, we include probate sales, short-sales, foreclosures, and bank and government owned homes as distressed sales. As the chart illustrates, the 12-month sales trend has increased for 5 consecutive months but is still at a level that is significantly lower than it has been for the bulk of the 5-year period illustrated on the chart.

St Louis 5-County Core Market Distressed Home Sale and 12-Month Trend for Past 5 Years

(click on chart for live, interactive chart with the latest data)

St Louis 5-County Core Market Distressed Home Sale and 12-Month Trend for Past 5 Years