After two years of skyrocketing sales, the Champaign County housing market is slowing down.
It’s a trend seen across the United States as interest rates rise in hopes of curbing a recession.
The average 30-year fixed rate mortgage according to the Federal Home Loan Mortgage Corporation was 5.41 percent in July, down from 5.52 percent in June and up from 2.87 percent in July of 2021. The average 30-year fixed rate mortgage averaged 5.22 percent as of August 11, 2022.
Overall, inflation slowed from 9.1% in June to 8.5% in July, but prices for food and rent continued to climb, the Bureau of Labor Statistics’ Consumer Price Index showed on August 10.
“Mortgage rates will continue to fluctuate and remain volatile as the economy regains momentum and inflationary conditions begin to slow,” said Pratt. “During July, buyers were affected by falling housing affordability conditions due to higher inflation and higher prices along with higher mortgage rates all contributing to overall slower sales.”
Home sales in the Champaign County area decreased 15.56 percent in July to 331 units from 392 in July of 2021. Year-to-date home sales were down 9.73 percent to 1,762 sales from the totals year-to-date of 1,952 sales through July of 2021.
Yet, according to the Champaign County Association of REALTORS® median home sale price in the Champaign County area rose 8.33 percent from $180,000 to $195,000 in July of 2021. The average home sale price for July was $218,020 up 1.74 percent from $214,297 in July 2021.
Inventory of homes for sale as of August 16, 2022 stood at 877 properties on the market down from 901 properties listed for sale last month. Homes listed in Champaign County are now on the market for an average of 19 days.
“The Champaign County area housing market continues to stabilize after two frenzied pandemic driven years that brought record-setting sales volumes during the months of July. As we enter the fall months, buyers may find a greater window of opportunity as there should be an increase to the numbers of listings coming on the market creating more favorable conditions and as more sellers begin to negotiate prices,” said Stefanie Pratt, president of the Champaign County Association of REALTORS®. “The market is still moving at a quick pace as there still remains peak buyer interest in homes that are well-priced. REALTORS® find buyers still are seeking work-from-home features as many people are still working hybrid.”
