The Real Estate Corner with Rick Seese: November Update

After 30 years of real estate management and teaching the business to hundreds of agents, I now focus solely on helping my clients buy and sell homes.  But now I also have time to share my experiences, knowledge and insight with you, the readers of Lowell’s First Look, on a monthly basis.  I invite your ongoing questions, whether you are planning on purchasing your very first home or your next home, or your last home.  Just email me your questions at [email protected].

We’ve Come a Long Way

Since March, the pandemic has controlled the way we do business.  From an entire shut-down to current controlled house showings and seller safety requests, we have bobbed and weaved our way back to a current market strength that seems unreal.  As the demand for housing marches on, we continue to be weary of economic concerns regarding unemployment and a continued concern for businesses in financial quandary.  Yes, on a normal basis, housing demand is usually tied to economic health.  However, the question continues, will our economic health rise to meet and conform to the current housing demand, or will the current housing demand begin to slow and meet the current status of the economy?  It currently appears that buyers are expecting our economy to catch up and all will be well.   Based on reader comments and emails regarding the desire for statistics, we will continue to center our analysis around the Lowell real estate market and the markets immediately surrounding Lowell.  Yes, a picture is worth a thousand words, but statistics can produce many pictures.  All the following statistics are Year-to-Date through October and produced from the Grand Rapids Multiple Listing Service (MLS).  The percentages are in comparison to 2019 numbers through the same reporting period.  Our West Michigan market ranks nationally as one of the more active markets in America.  West Michigan is a very popular location to purchase a home and raise a family.

The Market Demand

This chart compares the Lowell School District market area with other surrounding school district market areas. The percentages are increases/decreases over the same period as last year.

Year to Date Through October 2020

Location Average Sale Price Pending Sales
Lowell School District     $300,023     +8.8% +4.1%
Forest Hills     $433,635     +7.0% +2.3%
Rockford     $321,436     +3.5% +4.2%
Caledonia     $334,902     +10.2% -1.6%
Saranac     $228,420     +18.2% +8.6%
Belding     $169,453     +1.4% +5.4%
Lakewood     $173,314     +5.3% +34.7%

                       Statistics courtesy of GRAR is the Greater Regional Alliance of Realtors

 The Average Sale Price of a home in the United States is approximately $313,000.  Homes in eastern Kent County are well exceeding the U.S. average.  Homes in western Ionia County remain more affordable in comparison.  In western Ionia County, the Saranac School District is leading the way with an average sale price increase of 18.2%.  Lowell and Caledonia lead the increases in eastern Kent County.   Lowell’s average sale price continues to climb with an 8.8% increase.  Last month it was 8.4% ahead of last year.  Pending Sales show us that there continues to be a movement toward affordability, especially in Lakewood, Belding and Saranac School Districts.  Keep in mind that nearly 35% of all home sales are first-time home buyers.

Inside the Lowell Market Demand

                                                           Year to Date Through October 2020

Location Average Sale Price Pending Sales
Lowell School District     $300,023     +8.8% +4.1%
City of Lowell    $187,624     +2.6% +21.4%
Lowell Township    $306,207    +15.4% +4.1%
Vergennes Township    $336,100     +3.8% -7.6%

                       Statistics courtesy of GRAR is the Greater Regional Alliance of Realtors.

The above Lowell Market Demand data only compares the three highest populated municipalities within the Lowell School District.  The City of Lowell has 21.4% more Pending Sales compared to the same time last year.  Lowell Township has experienced a 15.4% increase in their Average Sale Price.  Lowell is popular among younger home buyers, citing their quality schools, convenient location and community vibrancy.

The Market Inventory

                                                     Year to Date Through October 2020

Location Homes Currently for Sale Months of Supply
Entire MLS – GRAR* -25.0% 2.2     -26.7%
Lowell School District -45.6% 1.4      -44.0%
Forest Hills -20.2% 2.1      -19.2%
Rockford -28.4% 2.1      -32.3%
Caledonia -22.4% 2.3      -20.7%
Saranac -35.7% 1.6     -33.3%
Belding -45.5% 1.5      -46.4%
Lakewood -10.7% 2.2      -18.5%

*MLS is Multiple Listing Service.  GRAR is the Greater Regional Alliance of Realtors.  Coverage area includes all of Kent and Ionia Counties, northern Barry County (inclusive of Gun Lake) and southeastern Ottawa County.  Statistics courtesy of GRAR is the Greater Regional Alliance of Realtors.

“Months of Supply” refers to the number of months it would take for the current inventory of homes on the market to sell given the current sales pace.  Historically, six months of supply is associated with moderate price appreciation, and a lower level of months’ supply tends to push prices up more rapidly.   Lack of inventory has been the market theme everywhere for the past few years.  Low inventory means less choices for buyers.  Extremely low inventory and above average demand causes escalating prices and multiple offers on desirable new listings.  All the compared school districts currently have a much smaller percentage of homes for sale, as compared to the same time in 2019.  Lowell has an enormous 45.6% fewer homes for sale.  Lowell, Saranac and Belding have the lowest Months of Supply in our area of focus, reinforcing the Eastern Kent County and Western Ionia County demand.

Inside the Lowell Market Inventory

Year to Date Through October 2020

Location Homes Currently for Sale Months of Supply
Lowell School District -45.6% 1.4      -44.0%
City of Lowell -37.5% 1.0      -37.5%
Lowell Township -25.0% 1.4      -33.3%
Vergennes Township -50.0% 1.5      -44.4%

Statistics courtesy of GRAR is the Greater Regional Alliance of Realtors.

The above chart magnifies the supply problem within the Lowell School District.  By the nature of seasonality, the Months of Supply will most likely plunge even lower over the upcoming winter months, especially if the demand continues.  These numbers continue to set historic low levels for our community.

Location Days on The Market
Entire MLS – GRAR* 13
Lowell School District 9
Forest Hills 12
Rockford 12
Caledonia 16
Saranac 11
Belding 13
Lakewood 18


Location Days on the Market
Lowell School District 9
City of Lowell 8
Lowell Township 11
Vergennes Township 13

 As a result of low inventory, homes do not stay on the market very long.  Properly priced listings are selling for over asking price and sometimes within hours of being listed.  Again, as in the past few months, Lowell leads the market swiftness with an extreme average of 9 Days on the Market.  Saranac continues their quick sales with only 11 Days on the Market.

Current Trends

The front end of the Millennial generation (born 1981-97) is now closing in on 40 years old.  The back end is still in their early 20’s.  This generation will continue to be the driving force for at least the next couple of decades, as they will have plenty of first-time home buyers continuing to step out of the rental market and into homeownership.  The older Millennials are now buying their 2nd, 3rd and 4th residences and will continue to drive the move-up market and vacation home market.  When you add the up and coming Generation Z group (born 1998-2010), the first-time homebuyer demand will continue to grow.  The front end of the Generation X group (born 1965-80) is beginning to eye retirement and the back end still consists of many move-up buyers.   The future demand looks extremely healthy from this angle.

Quality school districts remain an important focus for younger buyers, as they begin to raise their families.  Also, the demand for larger homes, larger lot sizes and smaller communities with more open spaces may be the new trend for the next generation. The rapid suburban movement is projected to remain a factor as more people work from home.  Unfortunately, buyer demand continues to build faster than homes are becoming available to purchase, especially in Eastern Kent County and Western Ionia County.  The inventory will continue to remain low, as Baby Boomer sellers (born 1946-64) are staying in their homes much longer before downsizing.  Look for the Lowell School District to remain a very strong, higher demand market.  Their quality school system, location and open spaces and parks will rank high on buyer’s checklists.

Looking Ahead        

Yes, there are concerns remaining.  The U.S. unemployment rate continues to decrease toward Pre-COVID-19 levels.  It now stands at about 7.9%, which is much better than the pandemic high of 13%, but not as good as 3%, as it stood back in February.  Michigan is higher at 8.5% and the Detroit area is 9.8%.  In contrast, Kent County is 6.6%.  We continue to hear of failing businesses and others on the brink.  Unfortunately, COVID-19 still has a grasp on everyone, with infection rates growing and further restrictions within sight of returning.  Many factors remain unknown as we move toward 2021.  On the bright side, we do know that interest rates will remain historically low for the foreseeable future.  We do know that there are COVID-19 vaccines on their way.  In the meantime, we all remain optimistic and continue to ride the recovery wave, as we continue to play our part with the support of local shopping.

Rick Seese works with buyers and sellers of residential, commercial and industrial real estate.  He is an Associate Broker with Greenridge Realty, Inc. and has been licensed full-time for 44 years.  If you’re interested in reaching out to Rick for more information, or have a question for the monthly article, you can contact him via email ([email protected]), visit his website at or Facebook page at ( Seese), or call/text him at 616-437-2576.

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