Published 9 October 2022
The median sales price of the 171 Las Cruces-area single-family homes sold in September fell below August’s median price by 6.3 percent, according to an Oct. 6 report from the Las Cruces Association of Realtors. The median is where half sold for more and half sold for less. September’s median price of $276,750 was $18,500 lower than the median price of $295,250 reported in August. On a brighter note for you homeowners out there, September’s median price was 6.4 percent higher than the $260,118 median price posted in September 2021.
Of the 171 listings sold in September, 56.7 percent were reduced in price at least once prior to sale. That’s up from just over 43 percent in August. Another 19.3 percent sold for full price, with the remaining 24 percent selling above the asking price. A few months ago, upwards of 64 percent of listings sold at or above their asking prices.
It is interesting to note that current sales data isn’t really current. That’s because sales prices are not reported until the transaction has closed, which is typically 30 to 60 days after the deal was made. As a result, sales prices agreed upon today will not be reported until November and December. The absence of those magic numbers is what makes pricing correctly such a challenge, especially in a changing market. Declining prices are not the only indicators of how higher mortgage interest rates are depressing our local market.
In Las Cruces between August and September: sales activity fell by 8.9 percent, the number of days on the market increased by 54.5 percent, and the number of new listings added to the inventory declined by 19.5 percent. Our inventory continues to grow, however, rising by 14.4 percent since Sept. 1. If it’s any consolation, our market is not the only one experiencing signs of weakness. According to a recent headline at Forbes.com, “Housing prices plunge in 77% of U.S. metro areas: ‘The turn has finally happened.”
Freddie Mac reported on Oct. 6 that the rate for the 30-year fixed-rate mortgage hit 6.7 percent. One year ago, it was 2.99 percent. If the market futures assume the Federal Reserve will raise the federal funds rate when they meet in early November, mortgage rates will rise in anticipation of the announcement. The result is that rates could easily reach seven percent by the end of this month or in early November. Marry that possibility with the seasonal slowdown that typically takes place over the winter months, and you have a recipe for a sluggish winter selling season. For potential buyers, the upside may be less competition with other buyers and home prices that may be slightly more affordable.
See you at closing.
Gary Sandler is a full-time Realtor and owner of Gary Sandler Inc., Realtors in Las Cruces. He loves to answer questions and can be reached at 575-642-2292 or Gary@GarySandler.com.