Welcome to the Brick & Corbett Market Snapshot! Every month, we’ll break down some stats from all or a part of our local housing market and seek to understand a little bit of what these numbers can tell us about our area, about buying and selling in Northern Michigan, and how you can use these insights to power up your home buying or selling.
Today, we’re taking a peek at the southside of Traverse City, specifically the rough square that is bordered on the north by US-31 starting at Chums Corner, on the east by M-37 starting at Chums Corner, on the south by Blair Townhall Road, and on the west by County Road 633.
If you’re about to click off this page because you don’t live in this area or don’t have any intentions of there, wait just a second, you’re going to want to read this. This area represents a section of our market that affects the ENTIRE market, everything from modest starter homes to the sales of luxury waterfront property, so read on to see why this is so important.
What’s Happening on the Southside? Let’s Break Down Some Numbers
Even though this area of the Traverse City market represents but a small number of the total homes, and certainly a narrow slice of the market prices, it’s extremely influential.
This zone has, in recent years, been an area where a lot of first-time homebuyers would make their first steps into homeownership. It has been a place where homes are generally a little smaller, more affordable, and without much in terms of luxury options.
Home ownership length was generally a little shorter here than in other places in the market since homes here are often first homes, and the typical stay in a first home is less than seven years, as opposed to a second home where the average is north of 12 years. This shorter home ownership time usually results in more homes selling each year than in other sectors of the market.
Not so in 2020.
In 2020, this section of southside Traverse City saw 44 homes sell, nearly 20% below the average number of homes to sell each year in the last five years (53). Comparing 2020 to 2019, the median days on market for a home in this area dropped nearly 19%, indicating that buyer competition for property had risen significantly. Based on this, you can probably guess that the median sold price for a home in this area jumped to $179,000 in 2020, up $26,500 from 2019.
In the month of December 2020 alone, the median sale price for homes was just shy of $240,000, including the sale of a home for a whopping $264,000 (the highest sale price for a home in at least the last five years in this region).
When you compare the December performances of this area going back all the way to 2016, we find that 2020 had the lowest median days on market (53) and the highest median sold prices ($239,950), further pointing us to the fact that this is a market that’s not heating up, it’s HOT.
Why Should We All Be Paying Attention to the Southside of Traverse City?
If you’re a property owner in this area, this answer’s easy. Your home’s value is maturing fast, and as demand for homes in our area continues to increase, it’s likely that this spike in value is going to continue, at least for the short-term. That may not always be the case though. 2021 has a real estate forecast equally hot as 2020 was, but markets are cyclical, so there’s going to be a slow down eventually. If you want to grab your equity and make a move, now is a great time to do it.
If you’re considering the purchase of a home in this area, especially if you’re a first time homebuyer, know that prices are going up quickly, and competition is fierce. Make sure you’re working with an agent that is going to give you all the competitive advantages you can get, including an aggressive offer strategy, getting linked up with a lender who can get you a speedy pre-approval, and insight into new listings as soon as they hit the market.
As for those of you who aren’t owners in this area or potential buyers, you should be paying attention too. This part of the greater Traverse City area has traditionally been a feeder market into some of the downtown neighborhoods, the east side areas like Holiday Hills, and even smaller communities just outside of Traverse City near M-22 and M-72. Whenever there is upward pressure at the bottom part of the housing market, the middle and upper rungs of the market will start to feel that pressure too.
The Next Inventory Pinch in Northern Michigan? Homes Between $250,000 and $325,000
Out-sized activity at the lower end of the market, say, for houses less than $200,000 is going to put specific pressure on homes in the $250,000 to $325,000 range, since you’ve got an unusually large crop of homeowners now shopping for the next home with a unexpected supersized chunk of equity in their pocket.
Though it’s true that all the different sectors of the market are connected so a move in one place will naturally affect the others, moves at the bottom are significantly more influential than moves at the top, since people are almost always looking to move up in home value, not down.
Where Do We Go From Here?
There has never been a more important time to be represented by a skilled and experienced real estate professional. The Brick & Corbett Team has decades of experience in residential real estate; we’ve seen every market condition, sold homes of every type and at every price point, and have what it takes to position you, whether you’re buying or selling, to get the best deal possible no matter where you live.
If you are ready to start talking about buying or selling a home in beautiful Northern Michigan, the Brick & Corbett team is here to help.