As spring breathes new life into Vermont, so too does it bring fresh dynamics to the local housing market. With the snow melting and flowers blooming, signs of market activity are evident, but the landscape is not without its challenges. As we prepare for peak buying season, let’s discuss the current market conditions for both buyers and sellers.

Demand vs. Inventory:

Buyer demand remains robust in Vermont, a trend that has persisted despite challenges such as elevated mortgage rates and soaring home prices. However, the key issue facing the market is the lack of inventory. As we enter peak home-buying season, the anticipation for new listings is palpable. While there are hopeful signs of more inventory becoming available, the historically low housing stock continues to be a bottleneck.

Impact of Mortgage Rates:

After reaching a two-decade high of 8% in late 2023, mortgage rates in Vermont have slightly eased to 7.125% as of April 22nd, 2024. This marginal decrease has encouraged some homeowners to list their properties, adjusting to the new rate environment. Nonetheless, rates remain elevated compared to recent years, potentially affecting affordability for some buyers.

“The housing market is likely to continue to face the dual affordability constraints of high home prices and elevated interest rates in 2024,” said Doug Duncan, senior vice president and chief economist at Fannie Mae. “Hotter-than-expected inflation data and strong payroll numbers are likely to apply more upward pressure to mortgage rates this year than we’d previously forecast.”

Despite these challenges, Fannie Mae predicts a national increase in home transactions compared to last year. While home prices are expected to experience a slower rise compared to the pandemic years, the fluctuations will depend strongly on local market conditions of housing supply and buyer demand. As Vermont has consistently maintained a strong buyer pool, we can predict prices will maintain a steady rise for the remainder of the year.

Buyer and Seller Dynamics:

Vermont has already seen an uptick in mortgage applications this year, which suggests that buyers who were previously priced out are re-entering the market. Historically, we’ve always seen more sellers return to the market as the weather warms, and we’re already seeing signs of this to again be true with a 7.7% increase in available listings statewide in March compared to the previous month. Moreover, various factors such as listings of new construction, downsizing baby boomers, and motivated home sellers are expected to contribute to an influx of options for buyers in 2024.

If you’re considering selling your home, there is still significant potential to explore. Due to the ongoing disparity between housing supply and demand in recent years, home values across Vermont have notably risen. Although the pace of price growth has eased recently, it doesn't necessarily indicate a decrease in your home's equity. If you're contemplating a change, the equity you've built up could make a considerable difference. Reach out to a sales professional to assess your options.

In conclusion, Vermont's real estate market continues to demonstrate resilience and strength, albeit amidst changing dynamics. For both buyers and sellers, staying informed about market trends and statistics is imperative for making sound decisions. Despite challenges such as high mortgage rates and limited inventory, opportunities abound in Vermont's housing market for those willing to navigate its complexities with diligence and foresight.

Chittenden County:

Single-Family Home statistics sourced from NEREN.com

In Burlington, last month saw 10 new single-family homes brought to market and 5 homes sold. The median market time was a surprising 16 days, which is a 220% increase compared to this time last year. The median sales price was $500K.

Chittenden County saw 76 new single-family homes available last month, with 46 sold. The median market time was a swift 7 days. Inventory levels are at 1.6 months; while compared to this time last year, we have a 14.6% increase, this is still well below a neutral market and the county remains firmly within a seller’s market due to the low inventory.

Lamoille County:

In Stowe, there were 6 new single-family homes brought to market, though no sales in March. Compared to this time last year, there was a 50% boost to available homes in this month’s sample size.

Across Lamoille County, there were 18 new homes available with 12 homes sold last month. The median market time was 9 days with median sales price of $447,500. Compared to this time last year, while there were 14.3% fewer homes sold, they were sold 76.3% quicker last month.

Washington County:

In Montpelier, there were 5 homes brought to the market last month, with 3 sold. The median sales price was $475K with a swift 4 median days on market. Based on last month’s smaller sample size, there appears to be 40% fewer sales with sales price increasing 69% in year over year comparisons.

In Barre, last month saw 9 new listings and 13 closings for single-family homes. Last month saw an unusual 45 median days on market, with a median sales price of $295K. Year over year, available homes are down 10% and median price is up 10.9%.

In Waterbury, there were 2 single-family homes available, while only 1 sold in March. This month’s sample size did not allow for comparative analysis.

Across Washington County, there were a total of 31 new single-family homes listed and 35 homes sold. While some areas in Vermont may see slight bumps in their spring inventory, Washington County appears slow to this trend with 20.5% fewer listings compared to this time last year. Inventory levels are sitting at a competitive 1.7 month supply, with sellers firmly maintaining the market.

Franklin County:

Across Franklin County, there were 46 new single-family homes brought to market. March saw 31 homes sold with 5 median days on market. Year over year, closed sales are up 24% with median sales price experiencing a 4.4% boost.

Grand Isle County:

Across Grand Isle County, last month saw 10 new listings and 4 homes sold. The median market time was an unusual 164 days, and sales price was $335K. Based on this month’s sample, there were 9% fewer homes available however homes were on the market almost 2000% longer than this time last year. An unusual month for real estate in the islands.