April 2023 St. Louis Real Estate Market Update
April in the St. Louis real estate market is usually a month during which it feels like buyers and sellers are gearing up for the busy summer season but for the first time this year there were fewer units for sale in 2023 than in 2022. Metrics like median sale price and percent of list price vs selling price remain very strong while key indicators like days on market and number of units for sale may be hinting at a shift in the market. Here’s what I think the data are telling us and what I’ve observed in the market this month.
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What the Data Tell Us
Though the number of closed sales in April 2023 is down -29.2%, the median sale price is still rising and is now up 3.2% YTD to $258,000. Due to a severe shortage of inventory, prices are still moving up despite higher interest rates.
The number of months of inventory (i.e. depth of supply) is up by 27.3% and while that may sound like a massive increase, it doesn’t come close to balancing out the huge shortage of inventory we have in relation to demand. A balanced, healthy market has between 4 to 6 months of inventory and despite the large increase for April 2023 we have only 1.4 months of supply leaving us thousands of units shy of satisfying demand.
For the first time in 2023 there were fewer units for sale than in 2022. The difference isn’t a big one (-34 units) but it’s an indicator to watch closely. Moving into the summer we have historically seen inventory levels rise each month until late in the fall when they begin to move back down for the winter months. If May and June show a continued decline in the number of units for sale that may signal a significant change in the market. Until that data is in we have to assume it’s just a slight dip as sellers prepare their homes for the summer market.
The number of Days on Market has been trending up every month in 2023 when compared to 2022 and is up 28.6% YTD, but the chart below shows the gap between this year and last is narrowing with April 2023 being up just 12% compared to April 2022. This is an important indicator of demand and one to watch closely. I expect this number to go down as we head into the summer months, a time when competition is historically at its most fierce, causing homes to sell quickly.
The percent of list price received by sellers in St. Louis for April 2023 is down -2.9% to 101.8%. Percent of list price received year to date is down by -2.9% to 99.9%. If a home is appropriately priced a buyer should expect to pay full price or higher if competing against other buyers. 99.9% is the median which means many homes are still selling above this number.
My Observations in the Field
Homes nearer to the median sale price ($200-450k) still seem to be receiving multiple offers and seeing fierce competition wherein buyers are removing as many contingencies as possible to increase their odds of winning the contract.
Homes over $800k and/or those that are in poor condition (at any price) seem to be sitting on the market longer than they would have last year (i.e. not selling during their debut weekend). Now that we have a sizable data set of higher sale prices from 2022, agents seem to be feeling more confident in setting prices at the top of the market. Higher prices combined with higher interest rates are causing buyers to be more cautious.
Most of my clients who are moving are doing so because they must (i.e relocating, expanding family, marriage/divorce). I’ve had fewer clients this year moving just for a change of scenery or to upgrade. Higher interest rates are causing more homeowners to consider renovations and/or additions instead of moving.
I’ve had more buyer clients getting discounts from asking price lately than I can remember seeing in the past couple of years. This seems to be happening mostly on listings that don’t sell during their first weekend. Being the first buyer to the table on Monday or Tuesday seems to be a good strategy for the time being, but at the risk of loosing the house to a more motivated buyer during the preceding weekend.
I’ve noticed that for buyer clients there are far fewer homes available to go see. Attractive properties in desirable locations and above average condition are coming to the market very infrequently which is causing some frustration that there isn’t much available to go out and see.
Housing Market Statistics for St. Louis City and County
April 2023
MEDIAN SALE PRICE
The median home sale price in St. Louis in April 2023 was up by 5.3% to $276,000. The median sale price is up 3.2% year to date to $258,000.
PENDING SALES
The number of pending home sales in St. Louis in April 2023 was down by 18% to 1,526. Pending sales are down by -16% year to date.
CLOSED SALES
The number of closed home sales in St. Louis in April 2023 was down by -29.2% to 1,189. Closed sales are down -21.1% year to date.
MONTHS OF INVENTORY
The number of months of inventory (i.e. supply) in the St. Louis housing market in April 2023 is up 27.3% to 1.4 months.
NUMBER OF UNITS FOR SALE
The number of units for sale in the St. Louis housing market in April 2023 is down by -1.7% to 1,996 units.
DAYS ON MARKET
The number of days on market in St. Louis for April 2023 is up by 12% to 28 days. Days on market year to date are up by 28.6% to 36.
PERCENT OF LIST PRICE RECEIVED
The percent of list price received by sellers in St. Louis for April 2023 is down -2.9% to 101.8%. Percent of list price received year to date is down by -2.9% to 99.9%
Information on this page covers residential real estate activity for single family homes in St. Louis City and County combined and is provided by Mid America Regional Information Systems. Percent changes are calculated using rounded figures.
