Aug. 6, 2018

Closed sales in Sioux Falls jumped 11 percent year-over-year in Sioux Falls in July, according to a report from the Realtor Association of the Sioux Empire Inc.

New listings increased 2 percent, so inventory continued to drop.

The market had 954 homes for sale during the month, down 25 percent from the same time last year and reflecting a 3.1-month supply – a 31 percent year-over-year drop.

“The chatter about housing-price bubbles has increased this summer as observers attempt to predict the next shift in the residential real estate market,” the report said.

“It is far too early to predict a hard shift away from higher prices and lower inventory, but the common markers that caused the last housing market downturn are essentially present. Wages are up but not at the same pace as home prices, leading to the kind of affordability concerns that lead to lower sales at lower prices. At the same time, demand is still outpacing what is available for sale in many markets.”

The average house in Sioux Falls sold for $241,676 in July, a 3 percent year-over-year increase. The median sales price has increased to $210,000, a 6 percent jump.

“Consumer spending on home goods and renovations are up while more people enter the workforce. Employed people spending money is generally good for residential real estate,” the report continued.

“Housing starts are down, but that is more reflective of low supply than anything else. With a growing economy, stronger lending practices and the potential for improved inventory from new listing and building activity, market balance is more likely than a bubble.”