Peoria-area Home Sales Down 15.2% in 2nd Quarter
Lack of inventory cited as main cause of decline as interest rates rise to cool off inflation.
PAAR reported that 1,983 homes were sold in the Peoria area in the second quarter of 2022, compared to the 2,338 area homes sold between April and June last year.
"Home sales are down year over year due mostly to still historically low inventory," said PAAR President Ryan Cannon. "Closed sales were down 15.2 percent, however, inventory was down 23.5 percent. Fewer homes to sell means there will be a decline in sales," he said.
Inventory- the number of homes on the market available for sale- has been a problem both locally and nationally for over two years, noted Cannon.
The average sale price for homes sold in the Peoria region in the second quarter was $168,433, up from $154,388 over the same period in 2021.
The lingering low inventory means homes don't remain on the market for long, he said. Homes averaged only 29 days on the market in the second quarter in 2022 compared to a 56-day average in the second quarter last year, according to PAAR statistics. "The average time on market shows that buyers are ready to buy and that properties priced properly move quickly," said Cannon.
Central Illinois remains an attractive destination for homebuyers beset by skyrocketing home prices across the country, said Cannon.
The median price of a U.S. home topped $400,000 for the first time in May, according to the Washington, D.C.- based National Association of REALTORS®.
"The Peoria are still shines bright for affordability," he said. "We are continuing to see a significant amount of people from outside our state moving to the Peoria area. You have out-of-state buyers potentially now paying $2,800 per month in rent who are quick to realize they can have the same space, and own it here, for half that," said Cannon.
Interest rates did jump this spring in an attempt to cool down inflation, he said. "With rates now around 5.5-6 percent, we are more in line with what rates historically have been. You're seeing that increased rate affect the affordability of some 'higher-end' properties. However, if you're a first-time buyer and are currently renting, the rates shouldn't matter too much as you're paying 100 percent interest when you're renting," said Cannon.
"With the current market for buyers, I'd say if you're ready to buy and have found the house want--don't wait," urged the PAAR President. "If rates go down you can refinance later, and if they go up, you'll be happy you locked in when you did."
"For sellers in this market, I'd say listen to your REALTOR® and price your property correctly for its condition and location," said Cannon. "Homes are still selling very quickly under $500,000, however condition and proper pricing are paramount," said Cannon