Home sales in Iowa held steady last month, while national data shows a decline of 2.7% in sales of existing U.S. home in March.
“So in some ways we’re maybe doing a little bit better in terms of sales,” says Robin Anderson, the chief economist for the State of Iowa.
But Anderson says the lack of supply is a big constraint on the housing market.
“Very low inventories and those are pretty comparable nationally and in Iowa,” Anderson says.
According to the Iowa Association of Realtors, there were 14.4% fewer Iowa homes for sale in March compared to the same month last year. The median price for an Iowa home sold last month was $203,500. That compares to $180,000 in March of last year.
“Home prices are up and they’re up pretty dramatically,” Anderson says, “but there are other pockets of the nation that have very high home prices,”
Anderson points to hot spots like Austin, Texas, where appraisals are up 56% since last year. The Iowa Association of Realtors reports Iowa homes are selling 20% faster this spring, averaging about 43 days on the market. The rate on a 30-year mortgage is about 5% now and Anderson says as rates rise, that may lead to a decline in home sales.
“But I do think the really constraining supply is going to basically constrain how far home prices go down,” Anderson says. “I would not expect a sharp downturn in prices because we really don’t have a lot of supply on the market.”
About 8500 single family homes were sold in Iowa during the first three months of this year. That’s a nearly 3.5% decline from the first quarter of 2021, partially driven by the historically low number of home listings in January.
Iowa home sales in the month of March alone were up just under 1% compared to March of last year.