December Lawrence Market Update

The end of the year is nearly here! I've made some predictions for this year, and I'm pretty confident they're coming true. First is that we would sell fewer than 900 homes inside of Lawrence by year's end. At the current rate, that's an almost-certainty. The Fall Market did not shape up like many hoped it would.  

Home sales inside the city limits continue large declines year-over-year and year-to-date. November alone posted a 21% drop from the same time a year ago. And it should be remembered that last November itself saw a decline of 31% vs November in 2021. So, in just two years' time, we've seen home sales in the month of November decline by a staggering 45.4%! 

Secondly I predicted modest price increases for sold homes. Average price jumped in November, likely due to continued low inventory: New listings nearly matched the drop in sales at a decline of 21.7%.  And it's looking likely that we'll end the year with a small appreciation. Nothing like we saw the previous years, but at a modest 2-3% increase. The take-home lesson here is, if you're on the fence about buying you need to get off that fence. At this rate, waiting to buy until prices come down will likely only result in paying a higher price for the same house later on down the road! 

All of the stats that follow are sourced from the Lawrence MLS. What follows is a look at some numbers through the month of November 2023 within the city limits of Lawrence:

Month-over-Month

• November home sales decreased 31.2% from the previous month (53 vs 77)
• Average price increased by 6.7% in November vs. the previous month, up to $357.6K
• Average Days-on-Market decreased 8% to 23 Days-on-Market
• 72 homes were listed in November, a decrease from 92 listed in October
• List-Price-to-Sales-Price Ratio for November was 99.12%

Year-over-Year

• Home sales were down 21% in November '23 vs November '22, a drop of 14 homes sold 
• Average Price was up YoY at $357.6K; an increase of 9.4% compared to November '22
• Dollar Volume was down 13.2% vs November'22  for a total of $19M in the month
• The 72 homes listed last month was a increase from 63 listed in November last year

YTD

• Home sales are down 25.5% for the year through November (817 vs 1,097)
• Average price so far in 2023 is up 2.4% to $336.5K vs the same period last year
• Average DOM is up 28.6% to 18 Days-on-Market
• Total Homes Listed this year equals 1,073; a decline of 15.5% compared to 2022
• Total Dollar Volume in 2023 is down 23.7%; At the end of November last year the Lawrence market totaled $360.6M and so far this year we're sitting at $275M

Active Properties

• There are 121 "Active" properties in Lawrence as of this writing; an increase of 1.7% since my last market update. 
• There are 66 properties currently listed as "Under Contract." This is a decrease of 4.3% since my last market update

Despite all these doom-and-gloom figures, there is a light on the horizon! Interest rates have slowly trickled down. As of this writing, they appear to have dropped below 7% in the past week or so. They had peaked over 8% just a month ago. This is a tremendous relief! And while it probably won't shake up much during the Holidays, it's a ray of hope heading into 2024. If rates continue a slow decline, then we should start seeing more market activity early in the Spring. 

2023 will likely go down on-par with year related to the Great Recession, in terms of total sales. However the key difference is that instead of prices going down, prices continue to go up. There is little that stands to change this reality in the near future. As rates go down, buyers will start to jump back into the market. I predict prices will increase in 2024 more than they did this year. 

People have to move. Jobs change. Life changes. Slowly, some will have to abandon their precious 2% rate they either bought their home with or refinanced a current home. Lack of inventory has been highly driven by home owners staying put in order to avoid having to buy at a higher rate. But this can't last forever and as everyone gets used to the "new normal" of 5-6%, things will relax a little bit. For those that seek opportunity, now through January could be a great time to buy before buyer activity picks up. 

Stay tuned to R+K Real Estate for great new content, updates, advice, opinions and more in 2024. We plan to continue our advance of transparency, consumer advocacy, and empowering our clients with alternate business models designed to provide high levels or real estate service with drastically reduced commissions!  

-Ryan Desch, Broker/Owner R+K Real Estate Solutions