Cleveland, Northeast OH Area Real Estate Market May 2014

According to the Northeast Ohio Regional Multiple Listing Service (NORMLS) and an article from the Cleveland Plain Dealer newspaper, homes sales in the region increased from April to May. Lower home inventory, higher rental prices and higher buyer demand due to low (but climbing) interest rates, have been driving this increase in activity and increase in sales prices over the past year or so. Sales volume is increasing, and sales prices have shown a slowing increase. A higher inventory in homes for sale would help boost sales activity.
Sales from April to May show an increase, however, sales from May 2013 to May 2014 show a decline.  Among the 15 counties in Northeast Ohio, we saw a healthy 16.3% increase for single family homes and a 33.1% increase in sales volume from April.  Single family home sales are down 6.3% from May of last year. Over the past 5 months of 2014 compared to 2013, we have witnessed a 3.3% decline in sales volume, but a 1.8% increase in prices for single family homes and 1.4% for condos.  Local home prices dipped slightly by 1.1% from May 2013 to May 2014. 

Ohio's sales volume showed an increase of 6.2% from April to May. Ohio's sales prices were relatively flat, with a 0.8% decline from last May with an annual increase total of 2.9%.  National figures have shown a 4.9% increase in sales volume and 5.1% price gain.  Ohio and Northeast Ohio's price increases have slowed or stabilized recently, but the increases are what would be typically expected for the region when compared with the nation.

The key point here is that the market is starting to stabilize and shifting to a balanced/seller's market.  Sellers are getting more for their homes than last year, with buyers paying a bit more to purchase a home to take advantage of the low interest rates.  Buyers should note that interest rates have decreased slightly, hovering around 4.2%.  A recent report indicates that economists are projecting rates to rise to 5-5.5% by year-end.

This is a great time for buyers who also have a home to sell, because rates are still relatively low on the buying side, but home values have risen in many areas to improve the financial return on the selling side.  If the economy continues to improve, buyers in the current market will be able to realize value gains for the homes they purchase as well.