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As the wait for mortgage rate cuts continues, the housing market continues to see a decline in pending sales, according to the latest report from the Greater Baton Rouge Association of Realtors.
Pending sales dipped 11.7% in July year over year, while new listings decreased by 3.6%.
“We’re watching the volume home builders slow down their absorption of lot purchases,” says Tom Cook with Cook, Moore, Davenport & Associates. “They’re not buying lots as quickly. I haven’t seen a price drop, but I have seen a slower absorption.”
GBRAR reports statistics from the region’s three main housing markets: Ascension, East Baton Rouge and Livingston parishes. Across the three parishes:
- New listings decreased 3.6% to 1,303.
- Pending sales decreased 11.7% to 827.
- Closed sales increased 3.6% to 1,023.
- The percentage of list price received decreased by 0.1% to 97.6%.
- Days on the market until sale increased 16.7% to 70.
- Inventory of homes for sale increased 22.7% to 4,083.
- Months’ supply of inventory increased 32.4% to 4.9.
“I don’t think it’s anything anybody didn’t expect,” Cook says. “It’s going to continue to slow down. Inventory will continue to increase because the rise in interest rates takes people out of their ability to purchase. As their rates go up, fewer people qualify for a higher note.
“A two to three-month supply (inventory) is a more stable situation where purchasers look at it and think, ‘I don’t have to.’” Cook tells Daily Report. You don’t have multiple offers on the purchase of a house. It was great for the seller but terrible for the buyer. I don’t think a two- to four-month supply is an unhealthy market.”
In July, the median sales price for homes across the three parishes increased 6.3% to $268,000. The median sales price was $261,500 in June, $260,000 in May and April, $250,000 in March, $257,000 in February and $258,000 in January.
In comparing the three parishes, Ascension saw the most significant jump in the median home sales price, rising 13.8% to $335,050 in July compared to last year. The median price was $343,180 in June.
The median sales price in East Baton Rouge increased 11.1% to $286,563; in Livingston, it decreased 4.2% to $238,560.
Cook says the market forecast he presented at the TRENDS seminar in May persists.
“I said at TRENDS that I don’t expect market conditions to change dramatically in 2024,” he adds. “I said the trend is going to continue, and the slowdown of sales and the increase in inventory seem to be happening.”
