October 2018 Real Estate Market Update – Wayne County, Michigan
We have your Wayne County Real Estate Market Update for October 2018. Let’s jump right into this. I always preface these market update videos with two things and we get these questions a lot, still, which is fine as we have new people coming in all the time, which is fine. We love that. I know for some of you it gets repetitive and I apologize, but we have to go over these things so you have context as to what’s going on. We have the month in arrears because now we have all the data that month is now finished and now we have all the data. It’s hot-off-the-press now we can give it to you and now you know exactly what’s going on. You can make informed decisions. So that’s why we always do the month previous.
And then we have three years of data because we want to show you patterns. We want to show you what’s going on. If we just showed you these past months of data in this year, it wouldn’t mean anything to you if we just showed you that. Numbers tell a story. As Rich Dad, Robert Kiyosaki always says so, or his rich dad, I should say, Robert Kiyosaki’s rich dad always said, “Numbers tell a story.” We want to see what’s going on. If you’re a stock investor, a real estate investor, you look at charts and graphs and things like that, you’re probably familiar with uptrends, sideways trends, and downtrends. This is a numerical version of that. We want to see which way the trend is moving, that way we can make intelligent decisions and as they say, ‘the trend is your friend.’
So we don’t want to be in a market here when you’re down here and then you’re trying to sell your home. You’ve got to know the data and that way if you’re thinking of selling your home and it’s up here and you see the trend is moving down, maybe you can get out here early and you’re not waiting until it’s down here. So that’s why this is really important. You want to be able to see the up-to-the-minute data, that way you can make those intelligent decisions, so let’s jump right into this.
Days On Market
DOM, additional days on market, cumulative days on market, just days on market. This is the average it takes a home to hit the market and then be sold, have accepted an offer. So that’s what this means. And again, this number has gone down pretty significantly over the last few years. We’ve had less inventory so it’s taken less time for homes to sell because there hasn’t been as much out there.
Active Homes on the Market
This is a one-off number. This is a number that we take at the end of every month and it’s a one-off number. So it’s very important to look at the past year’s data because these are all end of the month numbers for one day to see how many active homes are on the market. Again, we can see that it’s been fairly stable. Went down a bit last year and then came back up again a bit this year. Not as much as in 2016, but we can see that. There are still fewer homes in the market than there has in years previous because the years before that there were more homes in the market. So we can see that we’re still down a little bit and this next number is a ratio, it’s going to tell you even more about that.
Month of Inventory
Months of Inventory stands for the rate homes are selling, how long would it take to sell every last home with no new homes sitting the market. We were at three. We went down to two or back up to three again. Basically, to give you context, when you look at this number, it’s a very quick ratio to say. If you go to a new market and you’re like, “Boom, I want to know exactly what’s going on in this market and I don’t want to have to dive in all these numbers. Brandon, what do I do?” Well, you’re looking at this number, the months of inventory. One to three months is a seller’s market. Four to six is a balanced market and then seven-plus is a buyer’s market. So when you’re up in here in a buyer’s market, eight months of inventory, ten months inventory, we had that in 2009 and 2010. That means there’s a ton of homes available. There are tons of homes, not as much a buyer activity. So house prices go down a lot, right? So that’s where you have to be cognizant as, know where the market’s at, knowing our ratios and we know what’s going on with that, right? So that’s a month of inventory and you can see we’re in a seller’s market still, right? So we’re in a seller’s market. We’re going to see where this trend goes. And the next few months are gonna be very, very interesting.
New Homes on the Market
Now, this is a month wide number, how many new listings entered the market this month? And as you can see, this is actually increased a lot over the last couple of months. So now this is why I say it’s gonna be very interesting to see how these numbers play out over the next month or two and that’s a couple of months because now we have a lot more listings on average this past month than we have previously. So it’s very interesting to see what the numbers bear out over the next few months.
Price per square foot
This has gone up a lot because this is taking data basically in this next number sold. This is taking from the sold data and houses going on a contract over the last month or two and then closing. In October, the average in Wayne was $93 a square foot and that is a general overall number rule of thumb. If you want that true analysis on your home, you have to seek a real estate professional. Myself, some on our team, somebody, an appraiser that can give you a true value on your home and you can see what’s going on and that way you know exactly where you’re at. Because this is a countywide number, remember as a countywide number. It does not give you down to the detail, nitty-gritty information right there. The biggest reason putting a bow on this is we want to see the pattern. We want to see the pattern of where things are going. That’s why they give you these past years’ number so you can see where the trend is.
It is a number of homes that closed in that month. We had an uptick last year. We actually have gone down a fair amount this year because we had super low inventory in August and September. So we did not have very many closings back in October in Wayne County. Again, very interesting. We have a lot more homes for sale now. So the next couple of months will be very interesting to see how many sold we have in the months succeeding here. So, very interesting to see what’s going to happen here, how these trend lines look at what’s going to happen. We’re going to keep documenting all these and giving you this information that way you can make the best decisions for you and your family or for your investments or your business, whatever it may be.
So that’s Wayne County, October 2018, and we appreciate your time, attention and energy. If you have questions, comments, or concerns, please put them in the Facebook feed here in the comments. We want to try to keep everything here in the feed that way everyone can learn together. I really appreciate your, your emails, your texts, everything, your private messages. But we want to try to keep everything in here so everyone can learn from each other and grow and build that community aspect there. And that way we can try to serve more people at a higher level. So if you know anyone in Wayne County or you live in Wayne County yourself, please share it with someone you know that you think that might benefit from this. We really appreciate it and I appreciate your time, your attention, your energy because it’s truly the most important thing we have. We don’t get any more of it, so I appreciate that from you and we look forward to seeing you in the other market updates and our other videos soon. We’ll see you guys.