KANSAS CITY, Mo. — Despite inflation hitting a 40-year high and gas prices predicted to rise to $5 a gallon by the middle of summer, Kansas City real estate agents don't think the housing market will be heavily impacted.
Missouri Realtors released its report highlighting the Missouri real estate market for the month of April. According to their findings, there was a slight decrease in the number of homes sold, but houses continue to sell at higher rates compared to last year. The average price of a home is $285,764, a 12.2% increase from last year.
Kansas saw similar trends. The statewide average sale price in April was $284,455, a 10.5% increase compared to last year.
KSHB 41 News compared two homes recently in Kansas and Missouri. A home on 49th and Paseo in Missouri was listed on Zillow for more than $205,000, and a similar home on Glenwood Street in Mission, Kansas, was listed on Zillow for more than $189,00.
Heather Bortnick with the Koehler Bortnick team says homes are being underpriced to get multiple bids in and sell the home quicker.
“I have found that a lot of agents are pricing their properties aggressively,” Bortnick explained. “They're wanting for people to make multiple bids because a lot of the sellers don't want their houses to stay on the market for an extended period of time.”
Bortnick and her team sell homes in both Kansas and Missouri. They recently took reign over a home in Leawood’s Hallbrook neighborhood and listed it at $1.8 million, confident it’ll sell fast.
She says despite the current state of the economy, gas prices in both Kansas and Missouri are lower compared to other states. Plus, Bortnick adds commutes are shorter across the metro, so despite the increase in home values, price tags for homes in the Midwest remain low.
Even mortgage rates, although they are increasing, are still down.
“I think it's becoming more stabilized, and I think it’s people are becoming a little bit more comfortable with what mortgage rates are, what their jobs are, whether they're working from home, and I feel like it's a really good time. But because if rates are going to go up at all, now's a good time to get in the market,” Bortnick said.
Rent prices are also seeing an increase across the board. A new report by research company Clever claims nationwide rent prices are rising four times faster than income, and Kansas City is not immune.
“I have found this has really helped the housing market stay afloat because I don't know why somebody would rent when they can own their own property, and then they could put a little sweat equity into their house and then they could turn around and sell it in a couple years and make some money on it,” Bortnick said.
The pandemic also opened the doors for remote work which Bortnick says generated interest in wanting to become a homeowner with people looking for houses that offer office space.
“I think COVID has done nothing for real estate but be its friend," she said. "I mean, a lot of people are looking at where they're living and they want to love where they live. So they're either selling or they're renovating because they're spending so much time in their homes.”
However, the renovation industry is being impacted by changes in the economy. People looking to fix their homes are having to pay more and wait longer due to supply chain issues.
Bortnick advises buying now while one can.
“I think now is the time to get into the market," Bortnick said.