When the COVID-19 shutdowns hit in March 2020, virtually all home sales in Southern Oklahoma came to a halt for approximately a month and a half. As soon as sales resumed, they came back in a big way and a seller’s market was born.
A seller’s market refers to a housing situation where the demand for homes to purchase is higher than the number of homes available, and the seller’s market in the Ardmore area has remained in place for almost two years.
Marcus Cunningham, managing broker with United Country Southern Oklahoma Reality, illustrated the situation by sharing figures collected by the Greater Tulsa Association of Realtors. In addition to the Tulsa area, the numbers also include all of Southern Oklahoma and a large portion of the eastern region of the state.
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“In January of 2017, 2018, 2019 and 2020, it would take an average of about 45 days on the market for a home to sell, and right now that number is down to about five,” Cunningham said. “That’s the average length on the market. There are a few that places that have been for sale for a long time, and that skews the number somewhat. But homes that are priced in the right ballpark usually sell within five days or less.”
Cunningham said his personal record for a quick sale was 71 minutes from putting a sign in the yard to having a signed purchase contract. He also shared a story about a home he sold twice, once a few years ago and once recently.
“A couple years ago I sold it and only had one offer on it,” he said. “This year when I listed it again, I had eight offers within two days.”
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The short time many homes spend on the market combined with the number of buyers looking for homes has also led to the cost of the average home going up significantly. Cunningham said homes sold for an average price of $164,000 in January 2020, and this number jumped to approximately $200,000 in January 2022.
Another recent change in the market concerns the ratio of a house’s selling price when compared to its listing price. Cunningham said this figure was around 95% in 2017, but has been over 100% since July 2020. The only exception to this came in January 2021 when the figure dropped to 99.75%.
The quick sales and higher costs have led Cunningham to notice an interesting new quirk in the market. That is the number of people who back out of purchasing after getting an offer accepted.
“Typically when someone puts in an offer and it gets accepted, that sale will almost always make it to closing,” Cunningham said. “Now I’m seeing more people back out of houses in the first week than I ever have in my career. I think what happens is people are getting jumpy because they know how tight the market is right now. They’ll put in an offer early then freak out because they think they’ve made a hasty decision. That’s always occurred at times, but it’s getting more common.”
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Cunningham believes the current low interest rates are a major factor in fueling the current market. The low interest rates allow buyers to afford more house than they could have in years past, and in spite of higher prices they are still coming out ahead because they will end up paying less in interest. He said this has led to more people wanting to buy larger and more expensive homes as well as to more people entering the housing market.
“People who may have been renters in the past are now able to buy a home instead, and their monthly house payments are typically much cheaper than what they are currently renting,” he said.
While it may seem that fewer renters may lead to landlords having a more difficult time filling their properties, Cunningham said this is not the case. In addition to selling homes, he also has a management company with 232 properties for rent. Only one is currently vacant.
While he does not see the current market changing in the near future, he said things may begin to turn around in the coming months as interest rates are now going up again.