Demand
As late as November, nearly half of all closed sales have been at or above asking price. Buyers continue to compete for listings—a strong indication that demand for quality listings continues to exceed supply. Expect buyer enthusiasm to carry over into 2024. The bottleneck responsible for the 11% drop in NW Michigan sales this year was primarily caused by limited inventory (quantity and quality). Expect buyer enthusiasm to carry over into 2024 with additional boosts as interest rates adjust down.
Listing Supply
Compared to prior years, listings were slow to arrive in the early months of 2023. That flipped in the second half. By November new listings were running even with prior years since 2019. Inventory will continue to normalize in 2024. Some of the buyers who bought vacation homes during the pandemic may soon be ready to sell as they return to the rat race and struggle to find time to drive north for relaxing weekends.
Values
The combination of sharp demand and limited supply caused priced to jump in April and they have been holding steady since. Despite a slow start, YTD average sale price is up 10%. Prices typically fade off in the second half of the year as the quality of inventory gets picked over. This year, average price is holding steady. November’s average sale price of $497k was up 21% compared to last year.
Summary
Expect inventory levels to loosen up a little in 2024. The extra inventory will help feed hungry buyers. Sales, which were down 11% this year, will pick up slightly and prices, which rose 10% in 2023 may rise about half that much again in 2024.
