St. Louis offers a distinct housing market experience compared to other Missouri cities. Renowned for its affordability and cultural attractions, St. Louis attracts homebuyers seeking a charming and budget-friendly place to live. The St. Louis housing market in October 2024 shows a mixed bag of trends, with median home prices continuing to climb while home sales are slightly down compared to 2023.
The median sales price for single-family homes has increased by 13.2% to $300,000, indicating a still robust market. However, the number of homes sold is down, suggesting a potential shift in buyer activity. Overall, we see a more balanced market developing with some signs of cooling but not a significant downturn. Let's delve deeper into the current numbers and trends that are shaping the St. Louis housing market in 2024.
St. Louis Housing Market Trends in 2024: A Look at the Current State
Home Sales
The data from the St. Louis Realtors® for October 2024 indicates a slight decrease in home sales compared to the previous year.
- Single-family residential home sales saw a 2.4% decline, with 1,399 homes sold.
- Townhouse and condo sales experienced a more significant 5.7% drop, with 232 units sold.
This decline in sales could be attributed to a variety of factors, including rising interest rates, which can impact affordability for some potential buyers. Additionally, the recent economic climate may have influenced some individuals to postpone their home-buying plans. However, it's important to remember that the market isn't collapsing. The decrease is relatively small and can also be viewed as a healthy correction after the rapid growth of recent years.
Home Prices
In contrast to the slowdown in sales, median home prices continue to rise in the St. Louis housing market.
- The median sales price for single-family homes in October 2024 is $300,000, reflecting a 13.2% increase from 2023.
- Townhouse and condo prices also climbed, with a median sales price of $243,000, representing a 10.2% increase from the previous year.
The continued increase in home prices, despite the decline in sales, suggests that demand for housing remains relatively strong in St. Louis. This trend might be due to low housing inventory, which is putting upward pressure on prices. Also, the availability of jobs and overall economic stability in the region may be contributing to the demand.
Housing Supply
The supply of homes available for sale is playing a crucial role in the St. Louis housing market dynamics.
Here's a closer look at the inventory:
- Single-family residential homes for sale saw a significant 11.9% decrease in October 2024, with only 2,700 homes available.
- Townhouse and condo inventory, on the other hand, surged. It increased 59.8% to 620 units, a considerably large jump.
This suggests a continued imbalance between supply and demand for single-family homes, which is contributing to the upward pressure on prices. However, with the increased supply in the townhouse and condo segment, it's interesting to see how this influences the market in the coming months.
Months Supply of Inventory
The Months Supply of Inventory is a key metric that indicates whether we are in a buyer's market or a seller's market. It represents the number of months it would take to sell all available homes at the current sales rate.
Here's a breakdown of the current situation:
| Housing Type | Months Supply of Inventory (October 2024) | Change from 2023 |
|---|---|---|
| Single-family homes | 2 | Down 9.1% |
| Townhouse and Condos | 2.7 | Up 68.8% |
A lower months supply of inventory usually indicates a seller's market, meaning sellers have more leverage. The single-family home segment with 2 months of inventory certainly suggests a slight shift towards sellers having more influence. However, it's still relatively low compared to a balanced market that often hovers around 6 months.
In contrast, the townhouse and condo segment with 2.7 months of supply suggests a market slowly shifting to more neutrality. While it still favors sellers slightly, the increase is noteworthy.
Market Trends
The St. Louis housing market trends observed in October 2024 indicate a transition toward a more balanced market, compared to the highly competitive seller's market that we have experienced in recent years. There are signs of a cooling down with decreased home sales and a slight increase in housing inventory, particularly in the townhouse/condo sector. However, the market is not necessarily slowing down; just transitioning to a more sustainable pace.
Is St. Louis a Buyer's or Seller's Housing Market?
While the market is more balanced than it has been in recent years, it is still leaning slightly toward a seller's market, particularly in the single-family home segment. The low months supply of inventory in this sector still gives sellers a degree of pricing power.
But I believe that as we move further into 2024, the market may continue to shift towards more neutrality. The increase in inventory for townhomes and condos is a significant factor to consider. The rising interest rates might also play a role in stabilizing the market and perhaps leading to slightly more negotiating power for buyers. As a real estate professional, I've noticed that buyers are becoming slightly more cautious, and this is contributing to the cooling of the market.
Are Home Prices Dropping?
No, home prices are not dropping in the St. Louis housing market as of October 2024. Instead, they are continuing to rise, albeit at a slightly slower pace compared to previous years. We've seen a noticeable increase in the median sales price for both single-family homes and townhouses/condos.
However, it is important to note that the pace of price increases may moderate in the coming months due to the softening of demand and the increased inventory in certain segments. While price drops are not anticipated in the near future, I anticipate we may see more price stabilization rather than the significant jumps we've witnessed previously.
Average Days on Market
- Single-Family Residential: The average number of days a home stayed on the market before being sold in October 2024 was 30 days, compared to 26 days in 2023.
- Townhouse and Condos: The average days on market decreased slightly to 33 days in 2024 from 24 days in 2023.
The slight increase in the average days on the market for single-family homes suggests that homes are taking a bit longer to sell. This is consistent with the overall trend of the market becoming more balanced. However, the quick sale times continue to indicate a good market for sellers.
The increase in the average days on market for townhomes and condos is also likely a result of the increasing inventory and a bit more competition.
Pending Sales
- Single-Family Residential: Pending sales for single-family homes decreased 1.3% to 1,420 in October 2024.
- Townhouse and Condos: Pending sales for townhomes and condos increased slightly, up 0.5% to 212 in October 2024.
Pending sales represent contracts that have been signed but not yet closed. They give us an indication of the future sales activity. The small decrease in pending sales for single-family homes suggests a slight cooling in the market. The slight increase in pending sales for townhomes and condos is consistent with the increase in inventory.
My Thoughts
Based on the data and my experience as a real estate investor, I believe the St. Louis housing market is transitioning from a heated seller's market to a more balanced environment. This shift can be observed in the slight decrease in home sales, the modest increase in inventory (particularly for townhomes/condos), and the slight increase in days on market.
However, it's crucial to remember that the St. Louis housing market is still a very healthy one. The overall economy in the area remains stable, and job growth is generally positive. This provides a solid foundation for the housing market, even as we move towards a more balanced market.
In my personal experience, I have noticed a slight shift in buyer behavior. Buyers are now more comfortable negotiating and are taking their time in the home-buying process. Sellers also seem to be adjusting to the slightly shifting dynamics. This change is healthy for the market as it reduces the pressure of rapid price increases and enables buyers to find homes that fit their budgets.
St. Louis Housing Market Forecast 2024-2025
Based on the latest data from Zillow, the St. Louis housing market is projected to see a modest increase in home values over the next year. Specifically, home values are forecast to rise by about 1.7% by October 2025. However, the initial growth is expected to be slow, with only a 0.1% increase anticipated by November 2024 and January 2025.
Let's dive a bit deeper into what these numbers mean and what I expect in the future.
Home Price Forecast for St. Louis
I've been following the real estate trends in St. Louis for a while, and the Zillow forecast for the next year aligns with my own observations. Let's look at some key dates and projected changes:
| Forecast Date | Projected Home Value Change |
|---|---|
| November 2024 | 0.1% |
| January 2025 | 0.1% |
| October 2025 | 1.7% |
From the table above, it seems clear that the growth in the coming year is going to be gradual, and it will likely be noticeable toward the end of 2025.
How Does St. Louis Compare to Other Missouri Cities?
It's interesting to see how the St. Louis housing market compares to other major cities in Missouri. Here's a snapshot of the projected home value growth by October 2025 from Zillow:
| City | Projected Home Value Growth (October 2025) |
|---|---|
| Joplin, MO | 3.6% |
| Springfield, MO | 3.4% |
| Columbia, MO | 2.9% |
| Kansas City, MO | 2.7% |
| Jefferson City, MO | 2.8% |
| St. Joseph, MO | 2.5% |
| St. Louis, MO | 1.7% |
| Cape Girardeau, MO | 1.6% |
Based on this data, cities like Joplin and Springfield are expected to experience a higher rate of home value appreciation compared to St. Louis.
Will Home Prices Drop in St. Louis?
This is a question I get asked a lot. Will the St. Louis housing market crash? While there's always a chance of a market downturn, based on the current forecast, I don't anticipate a significant drop in home prices. The projected growth is slow but positive, and it suggests the market is relatively stable. Of course, local economic conditions and broader national trends could influence things, so it's essential to stay informed.
My Thoughts on the St. Louis Housing Market in 2026
It's tricky to provide a definitive forecast for 2026, but based on the current trends and my understanding of the local market, I wouldn't be surprised to see a continued, albeit modest, increase in home values. We may see a growth rate of around 2-3% in 2026.
The St. Louis housing market is currently a buyer's market with more inventory and less competition. So if you are considering buying in the St. Louis area, this might be a good time to do so.
Should You Invest in the St. Louis Real Estate Market in 2025?
Is St. Louis a Good Place For Real Estate Investment? St. Louis, Missouri is a city with a rich history, culture, and a growing economy. The city boasts a diversified economy with multiple sectors, including healthcare, education, and manufacturing, providing a stable foundation for real estate investments. St. Louis offers a range of investment opportunities, from affordable fixer-uppers to high-end luxury properties, making it an attractive option for both beginner and seasoned real estate investors.
One of the most significant factors driving the St. Louis real estate market is its affordability. It is one of the most affordable cities in the US. Despite being affordable, the city's real estate market is poised for growth over the next twelve months.
Another factor driving St. Louis's real estate market is the city's growing population. The city's population has been steadily increasing over the years, which has led to an increased demand for housing. This demand has caused rental prices to rise, making it an ideal city for real estate investors looking to capitalize on rental properties.
St. Louis is also home to some of the best neighborhoods in the country. Neighborhoods like Forest Park Southeast, Central West End, and Botanical Heights offer an excellent opportunity for real estate investment due to their high median home values and growth potential. Overall, St. Louis is a promising location for real estate investment, with a growing economy, affordable housing, and an increasing population. Investing in St. Louis real estate can provide investors with long-term financial benefits.
Top reasons to invest in St. Louis real estate:
Let's take a deeper dive into each of the top reasons to invest in the St. Louis real estate market.
- Affordable Home Prices: The average home value in St. Louis is $169,352, which is significantly lower than the national average. This means that investors can purchase properties at a lower price point and potentially see higher returns on their investment.
- Strong Rental Market: St. Louis has a robust rental market with a high demand for rental properties. Rental rates have been steadily increasing over the past few years. Investors can take advantage of this trend by purchasing rental properties and generating passive income.
- Growing Job Market: St. Louis has a diverse economy and is home to several major companies and industries, including healthcare, biotechnology, and finance. This has led to a growing job market with low unemployment rates, making it an attractive location for young professionals and families.
- Urban Revitalization: St. Louis has undergone significant urban revitalization in recent years, with several neighborhoods experiencing redevelopment and an influx of new businesses and residents. This has led to increased property values in these areas and presents opportunities for investors to purchase properties before they appreciate in value.
- Strong Real Estate Market Forecast: According to Zillow's MSA-level forecast, the St. Louis real estate market is expected to experience modest growth in the coming years, with a projected increase in home values of 0.4% by May 2024, 0.4% by July 2024, and a decrease of 1.3% by April 2025. While not a dramatic decrease, this forecast suggests a stable and steady market that is unlikely to experience significant declines.
I hope this article gives you a better idea of what to expect in the St. Louis housing market. Remember, the real estate market is dynamic, so it's crucial to work with a knowledgeable real estate professional who can provide guidance tailored to your specific needs.
Recommended Read:
