Missouri Real Estate Market: 2024 Trends and What to Expect in 2025

Written by David Dodge

As we delve into the current state of the Missouri real estate market, it's clear that we're witnessing a dynamic environment characterized by stability and gradual growth. The median home sale price has reached $273,400, reflecting a steady year-over-year increase of 4.1%. Notably, homes in Missouri are selling faster than ever, with an average of just 24 days on the market, indicating a highly competitive landscape for buyers and sellers alike.

Market Dynamics: A Seller's Advantage

The supply of homes available for sale has tightened, with an average inventory of just two months year-over-year. This trend typically signifies a seller's market. Interestingly, July 2024 saw a 4.8% increase in home sales compared to the previous year, with 7,545 homes sold, up from 7,203 in July 2023. However, the market's recent activity has been influenced by the National Association of Realtors (NAR) settlement, which has left many buyers and sellers feeling uncertain about pricing and agent commissions.

Implications of the NAR Settlement

The recent NAR settlement has introduced significant changes, particularly the removal of buyer agent compensation. This shift may lead to a decrease in home selling prices, ultimately benefiting buyers through improved affordability and lower mortgage rates. Currently, mortgage rates are hovering around 5.98%, making it a more favorable time for buyers to enter the market.

Key Insights for Buyers and Sellers

For Home Buyers

With the number of homes for sale rising by 18.8% to 25,207, buyers now have more options than ever. Coupled with the anticipated decline in home prices, this presents a unique opportunity. If you’re looking to purchase a home, consider negotiating for seller concessions, especially as demand and prices fluctuate.

For Home Sellers

As a seller, it's important to recognize that the anticipated correction in home prices may present a timely opportunity to sell. While prices may dip further due to the NAR settlement, listing your home now could allow you to capitalize on current demand before any potential declines.

The State of the Missouri Housing Market

So, what does the current housing market in Missouri look like? The landscape is balanced, with several key trends emerging:

• Days on Market: Homes are spending a median of 24 days on the market, a slight increase from last year, indicating sustained demand.
• Housing Inventory: The increase in inventory means buyers have more choices, with 25,207 homes currently available.
• Home Prices: The median home price stands at $273,400, but projections suggest a possible decrease as inventory continues to rise in the latter half of 2024.
• Sales Activity: Home sales have shown a positive trend, with a 4.8% increase year-over-year.

Understanding the Seller's Market

Missouri's real estate market is currently tilted in favor of sellers, driven by several factors:

• Quick Sales: Homes are moving quickly, often selling within 24 days, particularly in metropolitan areas like Gladstone and Creve Coeur.
• Competitive Offers: Many homes receive multiple offers, with a significant percentage selling above the list price, particularly in competitive neighborhoods.
• High Sale-to-List Ratios: Homes are typically selling for close to their asking prices, which reflects strong buyer interest.

Future Predictions for Missouri's Housing Market

As we look ahead to the remainder of 2024 and into 2025, several trends are anticipated:

1. Increased Buyer Activity: With more homes available and the easing of high interest rates, we expect to see more buyers re-entering the market.
2. Continued Price Growth: Home prices are projected to rise, particularly in key areas like Gladstone and Creve Coeur, where demand remains robust.
3. Shifts in Buyer Behavior: The rise of iBuyers offering lower-than-market offers may open up opportunities for traditional buyers.
4. New Construction Growth: Recent data shows a surge in new housing permits, indicating that builders are responding to demand with new developments.

The Impact of Zero Buyer Broker Commissions

The NAR settlement has also led to the elimination of buyer broker commissions, which could reshape the market significantly. This change may prompt buyers to seek homes independently, potentially diminishing the role of buyer agents. Conversely, sellers might face increased requests for concessions and may need to adapt their strategies to remain competitive.

Conclusion: A Balanced Market Ahead

Overall, the Missouri real estate market is poised for a balance between buyers and sellers in 2024. While sellers currently enjoy favorable conditions, the increasing inventory and competitive mortgage rates are likely to create opportunities for buyers as well. Whether you're searching for a cozy condo in Gladstone or a family home in Creve Coeur, the coming months promise to offer a wealth of options for prospective homeowners.

For more detailed insights into the Missouri real estate market, visit Missouri Real Estate Market.