March 2023 Ann Arbor Area Real Estate Market Update
How did the real estate market look in March, and what does it signal going forward?
Editor’s Note- MLS market data is available two weeks after the close of the reported month from the Ann Arbor Board of Realtors for the Ann Arbor Area.
Market Stats as of 5/9/23:
30 Year Fixed Rate Mortgage- 6.39% (down)
15 Year Fixed Rate Mortgage- 5.76% (down)
CPI (March Inflation)- 5.0% (still elevated)
Inventory of Homes for Sale- Low (same)
The video is for the Ann Arbor School District Specifically. The article is for the Ann Arbor area in general.
Executive Summary of the Ann Arbor Area Real Estate Market in March
Houses are selling for asking price but taking longer to sell and inventory is still low.
The 30-year mortgage rate was slightly higher last month at 6.49% compared to 6.39% currently.
Inflation was also slightly higher year-over-year last month at 6.00% compared to 5.00% currently.
The inventory of single-family homes for sale was down 25.2%.
New listings of single-family homes were down 17%.
Days on market were up 64%.
Median sales price was up 9.6% in March to $399,900.
Percent of list price received was 100%.
The Housing Affordability Index took a steep decline, down 24.5%.
Overall, in March 2023, prices were up and new listings were down.
What are Interest Rates Expected to Do?
Basically, interest rates are expected to go down slightly the next couple of years to about 5.5% but remain elevated from where they have been the last few years.
How Were the Market Indicators for the Ann Arbor Area Real Estate Market in March 2023?
Let’s look at 6 housing market indicators looked at broadly across the entire MLS for the largest possible data sample using data from the Ann Arbor Board of Realtors.
1. Inventory of Homes and Condos for Sale-
(Low Overall Supply)
We can see the inventory of single-family homes was down 25.2% from a year ago and down 31.8% for townhomes and condos.
2. New Listings-
(Low New Supply)
Similar to inventory levels, the number of new single-family listings were down 17% and for townhomes and condos new listings were down 23.6% in March compared to a year ago.
3. Days on Market-
(More Days)
Days on market for single-family homes were up 64% and for townhomes and condos up 156.5% from a year ago.
“Basically, interest rates are expected to go down slightly the next couple of years to about 5.5% but remain elevated from where they have been the last few years.”
4. Median Sales Price-
(Mixed)
The median sales price was mixed in March 2023. For single-family homes the median sales price was up 9.6% to $399,900 and for townhomes and condos it was down 0.5% to $285,000 from a year ago.
5. Percent of List Price Received With Offer-
(Down But Basically Still 100%)
The percent of list price received for single-family homes was down 3.0% to 100.0% and for townhomes and condos it was down 2.3% to 100.3% from a year ago.
6. Housing Affordability Index-
(Low and Getting Much Worse)
The Housing Affordability Index took another sharp decline in March 2023. For single-family homes, the Affordability Index dropped 24.5% and for townhomes and condos it dropped 17.1% from a year ago!
So, after looking at all 6 housing market indicators, what is the bottom line for the real estate market in March 2023?
Bottom Line for the Ann Arbor Area Real Estate Market for March 2023
Long term interest rates trending down recently has helped bring more buyers into the market.
Inventory levels remain low.
Days on market is increasing.
Median sales price was mixed in March 2023 but up overall.
As long as rates continue their downward trend, we can expect the median sales price to increase through the rest of 2023 and inventories to remain low but days on market elevated.
To your success!
Arbor Advising has a passion for helping people buy, sell and invest in real estate. We believe real estate is the best way to create passive income, grow your wealth and provide inflation adjusted returns in retirement with fantastic tax benefits.
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Disclaimer:
Always speak to your CPA, investment advisor and attorney before making any investment decisions. Past performance does not guarantee future returns. Arbor Advising seeks to educate and does not endorse any specific product, service or investment.
