Sept. 7, 2023

Home prices in Sioux Falls showed some rare softening in August.

The average price of a house sold in the city was $354,113, essentially flat with last year’s $353,972.

The median price dropped to $312,450 from $315,000 a year ago.

“Higher mortgage rates, along with elevated sales prices and a lack of housing inventory, have continued to impact market activity during the summer homebuying season,” according to an analysis included with the report from the Realtor Association of the Sioux Empire.

“The average 30-year fixed-rate mortgage has remained above 6.5 percent since May, recently hitting a two-decade high in August, according to Freddie Mac.”

Closed sales in the city fell 9.3 percent in August on a year-over-year basis, while new listings dropped 1.3 percent.

On average, it took 63 days for a house to sell, which is three more days than last year.

The city has a 3.4-month supply of homes on the market, up from a 3.1-month supply a year ago.

Sellers on average received 99.6 percent of original list price, down from 101.7 percent last year.

Nationally, sales of newly constructed homes hit a 17-month high in August, led by gains in the Midwest, where they were up 47.4 percent.

“The new-home market continues to benefit from the lack of existing-home inventory, and with many builders offering sales incentives, including price reductions and mortgage rate buydowns, homebuyers are increasingly turning to new construction for their next home purchase,” the report said.

In Sioux Falls, the price range with the largest gain in sales was $800,000 to $900,000, with a 61.9 percent increase.

Marketwide, inventory levels were down 2.1 percent. The construction type that gained the most inventory was the new-construction segment, with a 17.3 percent increase.