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Prices for Cedar Rapids homes keep rising, but inventory is down

For-sale homes in the area are coming off the market at faster rates

FILE PHOTO: Two houses along the 600 block of 9th Avenue SE in southeast Cedar Rapids, Iowa, on Tuesday, Dec. 6, 2016. (Jim Slosiarek/The Gazette)
FILE PHOTO: Two houses along the 600 block of 9th Avenue SE in southeast Cedar Rapids, Iowa, on Tuesday, Dec. 6, 2016. (Jim Slosiarek/The Gazette)

CEDAR RAPIDS — Wannabe homebuyers in the Cedar Rapids area may be finding it more difficult to land one as prices rise, the number of for-sale properties dips and homes move off the market at a faster pace.

“I think buyers are getting frustrated with this and just saying, ‘I don’t even want to look at it anymore because ... I have no negotiating power and most people want to bargain, most people want to negotiate on a price,’” said Cal Ernst, a Realtor with Coldwell Banker Hedges Realty. A house “is put up at $175,000 and you might have three offers and they’re all over the list price.

“The buyers are becoming frustrated with that and I think they’re just saying, ‘You know what, I think I’ll wait another year.’”

Matthew Patane / The Gazette

For the first half of 2018, homes in Cedar Rapids, Marion, Hiawatha and Robins have sold for an average of about $179,146 and a median price of more than $150,000, data provided by the Cedar Rapids Area Association of Realtors shows.

That’s up more than 3 percent each from the first half of 2017 and between 9 percent and 11 percent from 2014.

So far this year, average monthly homes sales were about on par with the same time last year. More units sold on average from January through March but fewer sold on average from April through June.

At the same time, homes have sold within an average of just 52 days this year — down from 63 in 2017 and about 84 in 2014. Plus, the inventory of homes for sale fell to just 565 on average for the first six months of 2018, compared to 690 the same time last year and more than 1,100 in 2014.

“As far as what I see in our marketplace, the houses under $250 (thousand), the $100 (thousand) to $250 (thousand), if it’s priced right, if it’s in great condition, it goes off the market within three days,” said Penny Novak, a broker associate with Skogman Realty. She noted, however, that higher-priced homes, such as those listed about $450,000, have been “sitting on the market.”

Ruhl and Ruhl Realtors, which sells homes across Eastern Iowa, said in a news release Friday that millennial homebuyers “are particularly struggling, with homes in their price point all but swallowed up.”

Both Ernst and Novak said the Cedar Rapids area could be facing a lower inventory of homes because owners who could sell and upgrade to a larger house are holding back.

“I don’t see them wanting to take advantage of the demand. If we did, we wouldn’t have 565 active units, we’d have 1,000 active units,” Ernst said.

Novak said she thinks most potential buyers in the area are optimistic about purchasing a home. Some can get frustrated, she said, if they’ve lost out on properties multiple times.

“If there is a property in perfect condition, priced right and there’s going to be multiple offers, you have to be able to move fast. That’s a hard thing for a lot of people to do. That’s a big purchase for most people,” Novak said.

Lower inventory and higher prices also has been a trend at the national level. The inventory of for-sale homes at the national level rose by the largest amount since 2015 in the second quarter of this year, Trulia Housing Data Analyst Alexandra Lee wrote in a blog post last week.

Even so, Lee noted the “seasonal inventory jump wasn’t enough to offset the historical year-over-year downward trend that has continued over 14 consecutive quarters.”

l Comments: (319) 398-8366; matthew.patane@thegazette.com

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