The pandemic has seen the demand for houses skyrocket. St. Louis is one of many cities that have seen median housing prices rise significantly with it being up to $324,000 in May of 2021.
With the St. Louis housing market increasing so rapidly, a prospective first-time homeowner may be wondering if the market will slow down enough in 2022 to be able to afford a home?
Well, this is the forecast for next year.
Based on the current trends at the end of 2021, there could very well be a new normal in St. Louis real estate because things seem to be calming down.
Look at this chart for the average number of days a house is on the market. Before the pandemic began, a house stayed on the market for an average of 85 days in St. Louis back in January of 2020.
For the rest of that year, it went to as low as 53 days in October before creeping back up to 76 days in January of 2021. But, then those numbers cut in half by the time the spring and summer came along.
It hit as low as 37 days in June and was at 53 days in October of 2021. That seems to indicate that it is past the peak demand but the fact the climb up has been so gradual for days on the market suggests that demand for houses may not be going away next year.
Not Enough Houses
Part of the reason why home buying is difficult in St. Louis, Missouri is complicated right now is because there are not enough houses available on the market.
How much of a difference was it? April is one of the most popular houses to buy a house and in April 2021, there were 44% fewer houses available than in April 2020.
Going back a month earlier to March 2021, there were 46% fewer houses available than in March 2020.
When you factor that in, it makes sense why the house prices became so expensive. In May of 2021, there was a 22% increase in house price sales and a 27% increase in sales compared to May of 2020.
These two go hand in hand and to avoid outrageous demand on one home, there need to be other homes to choose from. However, a factor here is that during the pandemic, most businesses had to shut down which includes construction crews that were building new houses.
On top of that, there is the price of lumber. It has been fluctuating like crazy with it being as high as $1,515 per thousand board feet in the middle of the pandemic.
It cooled down and got to as low as $389 back in August but the report shows that the price has increased by 124% since then to around $870.
If this continues, you could see house prices hold course or even keep gradually increasing in 2022.
Follow the St. Louis Housing Market
These are some things that you need to keep an eye on in the St. Louis housing market for 2022. If more houses do not become available for the market, expect the price to remain high for houses.
For more related information, check out our Real Estate section.