Local Real Estate Market Recap for July 2023

Dated: August 29 2023

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With the hustle of August, we are late getting you the results of the July real estate market for the Dayton area. Sales for the month were down 23.5% which is the sharpest decline vs 2022 that we have seen since January. New listings were down 14.6%, but that is an improvement over the prior three months when inventories dropped between 25.0-26.7% vs last year.

Average sale prices continue to rise vs last year. In July the average home sold for $266,457 which is 6.6% above 2022 and the highest rate increase we have seen since March. Overall for the year, the rates of price increases are lower than the previous 3 years which were in the double digits. Rising interest rates over the past 12 months have significantly affected mortgage payments and the prices that buyers are able to afford.

Looking ahead to the fall market

1. High interest rates will continue to affect affordability

As we write this, interest rates are at a 21 year high. Many experts had been anticipating rates were going to improve as we headed into the 3rd and 4th quarter this year, but now the outlook is not as promising. While forecasts are still showing rate improvements, we may have to wait until 2024 to see them. These higher rates will continue to put pressure on inventory levels as sellers with lower interest rates stay put instead of purchasing a home and taking on loans at higher rates.

Sellers need to be particularly careful when pricing their homes this fall. More buyers are moving to the sidelines waiting for lower rates and those still in the market are able to afford less home than they could a few months ago. With fewer buyers in the market, we do not expect to see as many multiple offer situations as we move through the next couple of months. Sellers need to understand the current market and pay attention to comparable properties when deciding how to price their home. They are better off pricing their home slightly under market value than slightly over it. A more conservative price will generate more interest from buyers and could increase the purchase price above the list price if you do find yourself in a multiple-offer situation.

2. Buyers still in the market may see better pricing.

We will be sending out the August market recap in about two weeks and based on our current observations, we are expecting to see the days to sell increase. Over the past couple of weeks we have also been seeing a lot more price reductions on current listings. As an example, 83 sellers have lowered their listing price within the last 24 hours.

Buyers who are paying cash or who need to move despite the higher interest rates are likely to find better pricing on homes and less competition as we move forward into the fall and winter. It looks like purchasing a home this fall will be less frustrating for buyers and once interest rates drop, those who will be financing a purchase this year will be able to refinance their loans at lower rates.

Are you considering a move in late 2023 or 2024? Let us know. We would love to work with you to put together a plan that will help you achieve your housing goals this year.

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Pat Bradley-Falke

I have been a Realtor for more than 46 years and have been with RE/MAX for the past 33 years. I have an education degree from Ohio State University and a master's in education from Wright State Unive....

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