Home sales in the Lincoln area have finally leveled off after several years of record growth.
At the end of the third quarter, the Realtors Association of Lincoln reported 3,913 total home sales through its Multiple Listing Service. That is up a tiny 13 total sales from the third quarter of 2017.
Sales of existing homes actually have increased about 1.5 percent over last year, while sales of new homes have dropped about 7 percent.
Kyle Fischer, executive vice president of the local Realtors Association, said a leveling off of the market is not necessarily a bad thing.
“We’ve consecutively set a new record for homes sold in Lincoln each year since 2015, so to see the numbers stabilize a bit is a good sign,” Fischer said in an email.
Actually, the upward trend in home sales goes back much farther than that. Other than a minuscule 0.1 percent decline in 2014, local home sales have increased every year since 2010.
In fact, the 5,200 home sales last year was up 50 percent since 2010.
Fischer said the biggest challenge in the real estate market right now is the affordability of homes.
That includes prices, with the median price of an existing home sitting at $177,900 at the end of the third quarter, up almost 10 percent from the $162,000 median in the third quarter of 2017.
It also includes interest rates, which averaged 4.81 percent nationally as of Thursday for a 30-year mortgage, compared with 3.9 percent at the same time last year.
The difference in monthly payment for a 30-year mortgage with 20 percent down on a $162,000 house at 3.9 percent interest and a $177,900 house at 4.8 percent interest is more than $140.
Despite prices continuing to rise, Tim Bayne, an agent with Sellstate Performance Real Estate, said he sees the market starting to shift from a seller's market to one that's favoring buyers.
"Buyers are starting to get a little more power than the sellers," Bayne said.
He said the last four deals he did all involved the sellers accepting offers that were below the listing price.
That's not an option in new construction, however, where prices continue to hit records.
According to the Realtors Association, the median sale price of a newly built home in the Lincoln area was $303,500 in the third quarter, up more than $22,000 from the same time a year ago.
Bo Jones, president of Tru-Built Construction and outgoing president of the Home Builders Association of Lincoln, said a "multitude of factors" are causing construction prices to rise.
Those include increases in the costs of materials such as lumber and steel, as well as increased labor costs and higher interest rates.
Jones said he has seen more "pushback" recently from buyers on the prices of new homes.
Not only have sales of new homes declined this year, but it appears fewer are being built.
Through the end of September, there were 504 new building permits issued for single-family homes in Lincoln, down from 555 at the same time last year.
Still, Jones said he doesn't foresee any big slowdown in home building or in sales of new homes.
Fischer echoed that sentiment.
"Home prices are strong, the economy is stable right now, and Lincoln’s housing market has historically been somewhat insulated from huge national fluctuations," he said. "As we all know, the market can change and it can change quickly. If we can work on the affordability factor, we’re confident Lincoln has a sustainable housing future.”