Half way through the year, home sales in the nine-parish Baton Rouge metro area were down 7.2% compared to sales through June of last year, the Greater Baton Rouge Association of Realtors announced this week.
While that may sound like a worrisome sign for the local market, it actually points toward a welcomed return to normalcy in the wake of the August 2016 flood when you take a deeper dive into the numbers.
After thousands of homes were damaged in the flood, home sales spiked through much of 2017, and especially in the first six months of year. Half way through 2017, sales were up 10.6% compared to 2016. By the end of 2017, however, the increase over 2016 had subsided to about 4.5%.
When comparing year-to-date sales this year to those through June of 2016, they’re up a healthy 2.5%. And while sales in June were down 9.4% compared to last year, they were flat compared to 2016 sales on the month.
Meanwhile, other signs of a healthy market can be found in the June housing report. Among them:
- Inventory—which grew extremely tight following the flood, driving up prices—appears to be rapidly growing. In June, inventory was up 21.2% over last year, and the 4,156 homes on the market represented a 12% increase over the 3,704 that were for sale during the month in 2016.
- The average sales price in June, at $223,584, is up 5.6% over last year and 1.8% over 2016.
- The average days on market was flat compared to last year, at 58 days, but was down from 67 days in 2016.
- Months supply inventory—or the amount of time it would take to sell all the homes on the market at the current sales pace—was at 4.6 months in June. Although that’s up from 3.6 months last year, it’s still well below the 6 month mark that realtors typically interpret as being representative of a seller’s market.
“Inventory may be persistently lower in year-over-year comparison, and home prices are still more likely to rise than not, but sales and new listings may finish the summer on the upswing,” reads the GBRAR June report. “The housing supply outlook in several markets is beginning to show an increase in new construction and a move by builders away from overstocked rental units to new developments for sale. These are encouraging signs in an already healthy marketplace.”
See the complete GBRAR July report.
