I saw an article recently about the results of a survey done of home sellers that found that nearly half of them didn’t realize they pay the buyers’ agent commission when they sell their home.
Sellers pay the buyers’ agent in almost all home sales in St Louis…
While I don’t know for sure, I would guess that the people surveyed were homeowners that planned to sell their homes, rather than sellers that already had their homes listed for sale. I say this because the standard listing agreement used by St Louis REALTORS® spells out the total commission being charged the seller, as well as the portion of the commission that will be paid to the buyers’ agent which I would think, would cause the seller to realize they are paying commission to the buyers’ agent.
While the seller, when presented with the listing agreement, could opt to not offer to pay commission to the buyer’s agent, the MLS rules require that all listings in the MLS (which is most of the St Louis home sales) include an “offer of compensation” for the buyers’ agent, which will come from the seller. Therefore, the sellers have to either offer to pay the buyer’s agent or forego having their listing in the MLS, hence why sellers pay the buyers agent in nearly all instances. It’s probably worth noting at this juncture that this practice has come under attack in a recent class-action lawsuit filed by Christopher Moehrl against The National Association of REALTORS®, Realogy Holdings Corp, HomeServices of America, Inc, Re/Max Holdings, Inc and Keller Williams Realty, Inc. The suit, which can be accessed using the link below, seeks to ban this type of commission arrangement.
Year to date, there have been 2,903 homes sold in the St Louis 5-County Core market, a decline of 3.6% from this time last year when 3,010 homes had sold. As the second chart below illustrates, the St Louis home sales trend (trailing 12 months and represented by the dark green line) peaked in October 2018 with 26,032 homes sold in the prior 12 months but then stalled and has begun a slight downward trend since with 25,756 homes sold in the 12 month period ending in February 2019.
Meanwhile, St Louis home prices continue to rise with the median price of homes sold in the past 12 months in the 5-County Core market increasing 4.79% from the prior 12-month period. As the table below the charts shows, the median price of homes sold in the St Louis 5-County Core market during the most recent 12-month period was $197,000, up from $188,000 during the prior 12-month period.
The inventory of homes for sale remains low, with just s 2.5 month supply of homes for sale in the St Louis 5-County Core Market.
The St Louis real estate market is still doing well however, home sales are off to a slower start this year than last year.
Find out more, as well as get information on some of St Louis’s best resources for home buyers and sellers in our just-released market update video.
In our MORE, REALTORS, 5 Minute St Louis Real Estate Market Update video below, you can quickly and easily get the latest information on home prices, home sales, trends and more for the entire St Louis area!
Thinking of selling and want to know if your neighborhood is a seller's market? Contact us and we'll answer that question for you.
You can now subscribe to our ITUNES Podcast Channel to receive our updated market videos via podcast automatically each week! Just click here, then click on "Subscribe Free".)
Sell Your Home For The Highest Price In The Least Amount of Time! See how- STLSellersAdvantage.com Save Commission On Your Home Sale Without Sacrificing Service! See how- FairCommissionRates.com
Since the announcement of the Better Togetherplans to merge the County and City of St Louis together into one big “Metro City”, there has been a lot of talk about the impact this would have on the St Louis real estate market. I’ve had several conversations with people in the real estate industry that feel St Charles County, as well as some of the other surrounding counties, will benefit if the Better Together plan succeeds. Their optimism is based upon the belief that, given what appears to be a tremendous groundswell of opposition to the plan from residents of both St Louis City and St Louis County, that, if it passes, many will flee the new Metro City.
Obviously, only time will tell as to whether the Better Together Plan will even get the required number of signatures on the petition, if so, then whether the voters pass it. It is only then, in the subsequent months and years afterward that we will really be able to see just what impact, favorably or negatively, it has on the St Louis real estate market. For now, however, it seemed a good time to take a look at the St Charles County and St Louis County real estate markets and compare them.
For the 12-month period ended February 28, 2019, there were 37,427 homes sold in the St Louis metro area, a decline of 1.22% from the prior 12-month period when there were 37,889 homes sold, according to our STL Market Report below. During the same period, the median price of homes sold in the St Louis metro area increased by 4.11% from $172,900 to $180,000. As the table shows, there is currently a 3.19 month supply of homes for sale in the St Louis metro area.
The median rental vacancy rate for the St Louis metro area during 2018 was 6.8%, according to data recently released by the U.S. Census Bureau. This rate marks the lowest annual median rental vacancy rate for St Louis since the U.S. Census Bureau’s reports which began in 2005.
As the table below shows, the vacancy rate for the 4th quarter of 2018 was 6.6%, down from 6.9% the quarter before and down from 9.2% a year ago.
During the 4th quarter of 2018, the homeownership rate for the St Louis MSA was 70.5%, the highest level since the 2nd quarter of 2015, according to data from the U.S. Census Bureau. As the table below shows, the 12-month rolling average for the St Louis homeownership rate was 66.0% in the 4th quarter of 2018, the highest since the 4th quarter of 2016.
Homes that sold in Maplewood, Missouri and closed within the past 30 days took an average of just 13 days to sell, putting Maplewood in the number 1 slot of Fastest Sold cities in the St Louis MSA. As the table below shows, the cities that made the top 10 list are scattered throughout the area from Granite City, Illinois to Washington to Hillsboro as well as several places in between.
If you are a homeowner thinking of selling and see your city on this list, now would be a really good time to consider listing your home for sale!
Sell Your Home For The Highest Price In The Least Amount of Time! See how- STLSellersAdvantage.com Save Commission On Your Home Sale Without Sacrificing Service! See how- FairCommissionRates.com
10 Fastest SOLD Cities In St Louis Metro Area in Past 30 Days
There were 3,143 home “flips” in the St Louis metro area during 2018, according to data just released by ATTOM Data Research. With 7.4% of homes sold in St Louis being a flip in 2018, this is a decline of 3.7% from a year ago. The peak number of flips in St Louis came in 2005 when there were 4,426 homes flipped.
What is meant by “flipped” home?
ATTOM Data considers any home or condo that was sold during the third quarter of this year in an arms-length sale that had previously had an arms-length sale within the prior 12 months as well as a “flip”. Since homeowners don’t tend to buy a home only to turn around and resell it within a year, when this does occur it is typically the result of an investor buying a property, renovating it, then reselling it.
There were 4,471 building permits issued for new homes in the St Louis area during the 12-month period ended January 31, 2019, a decline of 5.20% from the prior 12-month period when there were 4,716 permits issued, according to information just released by the Home Builders Association of St Louis & Eastern Missouri (St Louis HBA).
As the table below shows, St Charles County continues to see the largest decline in new home construction with 1,489 new home permits issued in the most recent 12-month period, down 13.03% from the prior 12 month period. Four counties in the St Louis area have seen gains in permits, with Warren County being the big winner in terms of percentage increase with nearly a 30 percent increase in new home permits for the period!
St Louis New Home Building Permits Issued – Jan 2019
I promise not to turn this article into one of my boring, lengthy diatribes that only a data nerd could enjoy, however, I do want to discuss something that I think is very important for all home buyers, sellers and investors. Given that today there is a plethora of “data” and “information” available to us thanks, in large part, to the internet, and that home buyer, sellers, and investors (as well as the real estate agents working with them) make decisions based, at least in part, to those things, it is imperative to know you have the right data and that it is the relevant data or information. Making a large financial decision, such as one related to buying or selling a house, on inaccurate, misunderstood or mispresented date or information, can literally cost you thousands of dollars.
A quick, and current, example…The St Louis Housing Inventory…
A report was released this past week from within the real estate industry that indicated there was an “inventory of homes for sale” of 3,272 in the City and County of St Louis combined and that this was “down 24.9% from 2018“. I saw many well-meaning real estate agents copy and paste the graphic or data on Facebook with messages that, if a buyer would create a little bit of a panic or concern on “missing out” and, if a seller, thinking competition is down so now is a good time to list your home and name your price.
The real estate market in St Louis continues to do well although the home sales trend, as our chart below illustrates, has flatlined over the past year. On our chart, we plot the home sales for the prior 12 months for each month thereby making it easier to see trends in the marketplace. As you can see, over the past 5 years, the trend line consistently increased from about this time 5 years until about a year ago where it leveled off. This is not surprising as it is not realistic for our market in St Louis to be able to support that growth rate indefinitely. St Louis has had very little population growth over the past several years, and everyone only moves so often, so there is only so much sales growth we can sustain.
St Louis Home Prices May Hit Resistance But So Far So Good..
There has been a lot of talk lately about a “price correction” coming in the housing market and I have discussed the possibility of it for the St Louis market as well. However, as the bottom chart shows, St Louis home prices during the past 5 years have been very consistent with an upward trend over time with the normal seasonal fluctuations along the way. Looking at the most recent couple of months as well as the past year as a whole doesn’t reveal any change in the trend at this point. Of course, this is something that can change quickly and I’ll be keeping an eye on it in the coming months but for now, things still look good for 2019 here in St Louis.
Even though it’s that time of year when the real estate market in St Louis slows down, we are still in a seller’s market in most of the St Louis metro area based upon the supply of homes for sale. Historically, a 6-month supply of homes for sale would be considered a “balanced” market, not favoring sellers nor buyers. If the supply drops below 6 months, it favors sellers as there is less competition for them and above 6 months it favors buyers.
Currently, 14 of the 17 counties that make up the St Louis MSA have a supply of homes for sale under 6 months. Two of the three counties that favor buyers, Macoupin and Calhoun, are in Illinois with St Francois County being the only Missouri County and it just barely made the list with a 6.26 month supply.
After mortgage interest rates on a 30-year fixed rate mortgage nearly hit 5 percent back in November, they have steadily declined and this past week fell to an average of 4.37% according to the Freddie Mac Primary Mortgage Market Survey. Last weeks 30-year fixed rate mortgage rate of 4.37% was the lowest average rate report by the survey since Feb 8, 2018, when the average rates were 4.32%.
The outlook for mortgage interest rates looks promising as well with the most recent Fannie Mae Housing Forecast predicting the 30-year fixed rate will stay at 4.5% through the end of 2020.
At the end of last month, Better Together, a not-for-profit group aimed at combining St Louis City and St Louis County into one big “Metro City”, released their plan for doing so. To say this is a hot topic among residents of those two areas would be an understatement.
Proponents of the plan say it will make St Louis the 9th largest city in the U.S., will streamline government, dilute the city crime stats making them appear to be better and, in the end, lead to increased economic development and growth for the region.
Opponents, such as the Municipal League of Metro St Louis argue that their (Better Together) plan is unconstitutional (hence why the Missouri Constitution must be changed to permit it) and that “the great divorce”, the label applied to when the city of St Louis separated from St Louis County back in 1876 was done using the Board of Freeholders, so if the two want to get back together, the same approach should be done to accomplish it (Board of Freeholders). Additionally, the opponents argue that allowing the entire state to decide the fate of the people of these two counties is wrong, that historic cities (such as Florissant and Kirkwood) will be disbanded and, in the end, the underlying problems that hinder growth here won’t’ really be addressed.
The proceeding is, of course, my very brief synopsis of the two views as I see them so I would suggest you research the matter for yourself and have included some resources below to do just that.
The St Louis real estate market is off to a little slower start this year and there are some indicators that we may be in for a little price correction in some areas.
Find out more, as well as get information on some of St Louis’s best resources for home buyers and sellers in our just-released market update video.
In our MORE, REALTORS, 5 Minute St Louis Real Estate Market Update video below, you can quickly and easily get the latest information on home prices, home sales, trends and more for the entire St Louis area!
Thinking of selling and want to know if your neighborhood is a seller's market? Contact us and we'll answer that question for you.
You can now subscribe to our ITUNES Podcast Channel to receive our updated market videos via podcast automatically each week! Just click here, then click on "Subscribe Free".)
Sell Your Home For The Highest Price In The Least Amount of Time! See how- STLSellersAdvantage.com Save Commission On Your Home Sale Without Sacrificing Service! See how- FairCommissionRates.com
Many of the forecasts for home sales this year call for either a slight decline from last year or about the same as last year, in terms of home sales. I think the St Louis market will probably see about the same number of homes sold in 2019 as we did in 2018, it may just come with a little bit of a price adjustment. So, while I don’t like looking at home sales “year over year” for one month, I’m going to make the exception today and include that. As the first chart below shows, in January there were 1,282 homes sold in the St Louis 5-County core market (non-distressed home sales) which is down 5% from January 2018 when there were 1,352 homes sold but is up nearly 2% from January 2017 when there were 1,259 homes sold.
During the fourth quarter of 2018, 14.2% of the homeowners in St Louis with a mortgage, were underwater on their mortgage, meaning they were in a negative-equity postion, according to data just released by ATTOM Data Research. As the table below shows, this is the lowest rate since the 4th quarter of 2017 when the St Louis undertwater homeowner rate was at 13.8%. On a national level, just 8.8% of homeowners with a mortgage are underwater which puts the St Louis rate at 161.5% of the US rate.
St Louis Underwater (Negative-Equity) Homeowners – 2013-2018
At the start of this year, the Missouri First-Time Homebuyer Savings Account program went info effect making it easier for first-time home buyers to prepare to buy a home. This program provides for tax-deductible savings acounts for first-time homebuyers making it easier for homebuyers to save for a down payment by giving them a tax decution for the amount they save. People wanting to save for a home can contribute up to $3,200 per year for married couples and $1,600 for all others. Homebuyers participating in this program will be entitled to a tax deduction on their Missouri Income tax return equal to 50% of the amount they contributed to their first-time homebuyer savings account.
The list of the 10 St Louis cities where homes sold for the highest average price last year shown below reveals that the little city of Huntleigh, consisting of a land mass of just 1 square mile but home to some of the wealthiest people in St Louis, is where homes sold for the highest average price during 2018. Granted, there were only two homes sold in Huntleigh during the past year (which were in the MLS) but with prices of $2.785 Million and $9.8 Million (for an average of $6,292,500) it catapulted Huntleigh to the top of the list of the most expensive average home sales price for St Louis. Coming in a distant second to Huntleigh is Ladue where the average sales price was $1.104 Million.
See the most expensive homes sold in St Louis in the past year here.
There were 4,140 building permits issued for new homes in the St Louis area during 2018, a decline of 3.16% from the year before when there were 4,275 permits issued, according to information just released by the Home Builders Association of St Louis & Eastern Missouri (St Louis HBA). The number of permits issued for new homes during 2018 was just slightly down from 2016.
As the table below shows, St Charles County has seen the largest decline in new home construction with 1,499 new home permits issued in 2018, down 12.85% from the year before and decline of 24.48% from 2016 when there were 1,985 permits issued. Franklin County, Warren County and the city of St Louis all had significant double-digit gains in building permits issued during 2018 from the year before.
St Louis New Home Building Permits Issued – 2016-2018
The St Louis real estate market closed out another good year with
2018 finishing just slightly behind the year before in terms of home sales. Thus far, it looks like 2019 is off to a good start as well although higher interest rates will, no doubt, cause a little tension in the market this year.
Find out more, as well as get information on some of St Louis’s best resources for home buyers and sellers in our just-released market update video.
In our MORE, REALTORS, 5 Minute St Louis Real Estate Market Update video below, you can quickly and easily get the latest information on home prices, home sales, trends and more for the entire St Louis area!
Thinking of selling and want to know if your neighborhood is a seller's market? Contact us and we'll answer that question for you.
You can now subscribe to our ITUNES Podcast Channel to receive our updated market videos via podcast automatically each week! Just click here, then click on "Subscribe Free".)
Sell Your Home For The Highest Price In The Least Amount of Time! See how- STLSellersAdvantage.com Save Commission On Your Home Sale Without Sacrificing Service! See how- FairCommissionRates.com
Jefferson County, with an estimated population of 221,577 during 2018, had 317 foreclosure filings during 2018, giving it the highest rate of foreclosure filings per capita, at 1 foreclosure filing for every 699 in population, of the all the Missouri counties with a population of 50,000 or greater. As the table below shows, the three Missouri counties with the highest foreclosure rate per capita are all located within the St Louis MSA and Boone County, in the Columia MSA, has the lowest forreclosure rate in the State.
Yesterday, I wrote an article about the number of foreclosures in St Louis during 2018 dropping to the lowest number in over 12 years, however, in spite of that good news, St Louis still has the 8th highest rate of foreclosure among the 20 largest metro areas in the U.S.
According to data just released by ATTOM Data Research, as the table below shows, during 2018 St Louis had a foreclosure filing for 1 of every 180 housing units. This rate puts St Louis at the 65th highest rate of the 219 MSA’s in the U.S. with a population of over 200,000 and at the 8th highest rate of the 20 largest MSA’s. Worth noting is St Louis barely made the list of 20 largest MSA’s coming in at 19th largest based upon population.
As evidence of just how much the St Louis housing market has improved since the housing bubble burst a little over a decade ago, as well as a testimony as to the strength of our economy, the number of St Lous homeowners thatlost their homes to foreclosure last year dropped to the lowest level in over 12 years.
As the tables below show, during 2018, 6,882 homeowners in the St Louis metro area received a notice of a foreclosure filing from their lender on their property, a decline of 6% from the prior year when 7,323 homeowners received a foreclosing filing notice. The number of foreclosure filings in St Loius during 2018 was down 68.3% from 2010 when the number of foreclosures in St Louis hit a record high with 21,741 homeowners receiving a foreclosure filing notice.
According to a report just released this morning by ATTOM Data Research, it’s cheaper to buy a home than rent in 6 of 8 St Louis metro area counties covered in the report. The data reported also shows, however, that home prices are rising faster than rents in all of the counties, a trend that, if it continues, could make buying a home a less affordable option in the future. The data also shows, on a postiive note, that in 6 of 8 counties wages are rising faster than rents. The counties are split when it comes to wages vs home prices however, with wages rising faster than home prices in 4 and home prices rising faster than wages in the other 4.
Affordabilty is determined by the percentage of wages necessary to purchase a home in a given County. Based upon this criteria, the most affordable county to buy a home is the City of St Louis at 20.1%, followed by Madison County, IL at 27.3% and then St Louis County at 27.6%. The least affordable county to buy a home on the list is St Charles County at 45.3%
While we still have muncipalities and neighborhoods throughout the St Louis metro area where homes are selling very quickly, there are some areas where it does take longer to sell a home. The list below shows the 10 slowest selling cities in the St Louis MSA based upon the time it took homes to sell that closed within the last month.
At the top of the list is Herculaneum in Jefferson County Missouri where the average time to sell was 154 days, nearly 5 times the median time of 32 days for the St Louis MSA. Of the remaining 9 cities on the list, 5 are in St Louis County, 2 are in Illinois, 1 in Franklin County and 1 in Laclede County.
It may be the slow season for real estate but there are still plenty of areas in St Louis where homes are selling fast! As the table below shows, the cities where homes have sold the fastest in the past 30 days are scattered throughout the St Louis metro area. From number 1 on the list, Wright City in the far western area of the metro area in Warren County to number 2 on the list over on the east side of the Mississippi River in Waterloo Illinois.
10 Fastest SOLD Cities In St Louis Metro Area in Past 30 Days (click on table for complete, live list)
Early Christmas evening, the commercials began for “after Christmas” sales by anxious retailers that couldn’t even wait until after Christmas to tell everyone what great bargains can be had. Well, the same holds true for residential real estate in terms of bargain prices at this time of year. It’s no secret that the number of homes sold, as well as prices, decline during this time of year, but I don’t know that would-be home buyers realize just how much they can save if they buy a home during this slow season.
As the STL Market Chart (exclusively from MORE, REALTORS) below shows, the median price of homes sold (the red line) dropped to the lowest level of the season in January earlier this year and in February the year before. The number of homes sold (the pink line) always hit its lowest level around the same time. Historically, this happens every year around the same time when the market is good as well as when it is not. As the chart shows, the home prices in November remained the same as October, but the number of home sales dropped significantly and prices will follow no doubt. Worth noting is that in January of this year, home prices hit their seasonal low at $168,444 but then by April, just 3 months later had increased 12.5% to $189,500 and finally peaked in June at $204,900, a 21.6% increase from January’s low.
Wishing you and your family and loved ones a very Merry and Blessed Christmas!
“For to us a child is born, to us a son is given, and the government will be on his shoulders. And he will be called Wonderful Counselor, Mighty God, Everlasting Father, Prince of Peace.” Isaiah 9:6
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