June 7, 2021

Home prices in Sioux Falls are up 15 percent year-over-year, and inventory took another big drop in the past month.

The average price of a house sold in May was $307,488, a record high and a 15 percent year-over-year increase, according to the Realtor Association of the Sioux Empire Inc.

The median price was $265,000, also a record, and a 15 percent increase.

“Prices continued to gain traction,” an analysis included with the report said.

“As the weather warms and pandemic restrictions ease across much of the country, the U.S. housing market shows little sign of cooling. Robust buyer demand, fueled by low mortgage rates, continues to outpace supply, which remains near historic lows. Nationwide, inventory remains much lower than it was at this time last year, and sales prices are surging as a result.”

In the city of Sioux Falls, inventory was down to a 1.9-month supply, a 53 percent year-over-year drop.

New listings totaled 356 houses for the month, down 22 percent.

Closed sales fell 18 percent.

“With such limited supply of existing homes to purchase, all eyes are on homebuilders to provide a much-needed boost of inventory to the market to help meet buyer demand,” the report said.

“However, increasing material and labor costs, along with supply chain challenges, have contributed to significantly higher construction costs, with builders passing these costs on to homebuyers. And while the warmer temperatures, rising sales prices and the reopening of the economy may draw more sellers to the market, historically low levels of homes for sale are likely to continue for some time.”

The average home spent 70 days on the market before selling, which is 20 days faster than the same time last year.

And many sellers got more than their list price, with the average house selling at 101 percent more than original list price.

The price range with the largest gain in sales was the $800,00 to $900,000 range, where they increased 100 percent.