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Kansas City Housing Market Trends and Forecast for 2024 – Norada Real Estate Investments

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The Kansas City housing market is hot and in many ways the envy of housing pundits on both coasts. This dynamic market spans both Missouri and Kansas and is characterized by rising home prices, low inventory, and a fiercely competitive market. Whether you’re a buyer or a seller, staying on top of the latest trends and forecasts for 2024 is crucial. In this article, we’ll provide a comprehensive overview of the Kansas City housing market by delving into the latest data, insights, and predictions. So, let’s dive right in!

Current Kansas State Housing Market Trends

Kansas City is also in the state of Kansas. It is the third-largest city in the U.S. state of Kansas, and the county seat of Wyandotte County. The following housing market trends are the state of Kansas and the Kansas City located there. Kansas is a state in the Midwestern United States that has seen some significant changes in its housing market in recent years.


Buy/sell, rent/lease residential &
commercials real estate properties.

The housing market in Kansas witnessed notable changes in November 2023, showcasing a dynamic landscape of shifting trends. As KAR president Thomas Howe from McGrew Real Estate in Lawrence aptly stated, “Sale prices are continuing to rise, even as sales activity has slowed.”

Home Sales Decline:

In November 2023, home sales in Kansas experienced a 7.0% decline compared to the same period in the previous year. This trend was not unique to the state, as national home sales also took a hit with a substantial 17.3% decrease over 2022. Despite the slowdown in sales activity, the real estate market in Kansas is undergoing interesting transformations.

Rising Home Prices:

Contrary to the dip in sales, home prices continued their upward trajectory across the state. The statewide average sale price in November reached $305,833, indicating a significant 5.0% increase compared to the previous year. This positive trend aligns with the broader Midwest region, where prices rose by 4.9%. On a national scale, the United States experienced a 4.0% increase in home prices during the same period.

Impact on Mortgage Rates:

An additional factor influencing the housing market is the fluctuation in mortgage rates. Notably, the national average commitment rate on a 30-year conventional mortgage for the week ending December 15, 2023, saw a decrease, settling at 6.67%. This decline in mortgage rates adds an interesting dynamic to the overall real estate landscape, potentially influencing buyer behavior in the coming months.

Key Takeaways:

  • Home Sales: Despite a 7.0% decline in home sales, the market remains active with potential shifts in buyer behavior.
  • Price Surge: The surge in home prices, both in Kansas and nationally, indicates sustained demand and the potential for a robust market.
  • Mortgage Rate Impact: The decrease in mortgage rates could stimulate buyer interest, possibly mitigating the impact of the sales decline.

Missouri Housing Market Trends: Navigating November 2023 Data

The Missouri housing market in November 2023 reflects a dynamic landscape with fluctuations in key metrics. While the number of listings and homes sold has experienced a decline, the median residential property selling price continues its upward trajectory.

Number of Listings:

July-23: 9,168 | August-23: 9,902 | September-23: 10,509 | October-23: 11,012 | November-23: 10,401

According to the Missouri REALTORS®, despite a slight dip from October, November witnessed a robust 10,401 listings, showcasing the resilience of Missouri’s housing market.

Year-to-Date Figures:

2023 YTD vs 2022 YTD: -15.1% | 2023 YTD vs 2021 YTD: -25.9% | 2023 YTD vs 2020 YTD: -17.9%

The year-to-date figures reveal a nuanced narrative. While 2023 has experienced a decrease compared to the previous year, it’s essential to note the market’s resilience over a longer timeframe, with a more moderate decline compared to 2021 and 2020.

Number of Residential Properties Sold – YTD:

79,933 (November-20) | 88,602 (November-21) | 77,285 (November-22) | 65,636 (November-23)

The number of residential properties sold year-to-date paints a picture of a market in flux. With 65,636 properties sold in November 2023, there’s a notable 15.1% decrease compared to the same period in 2022.

Median Residential Property Selling Price – YTD:

188,500 (November-20) | 217,000 (November-21) | 240,000 (November-22) | 249,900 (November-23)

Despite the decrease in the number of properties sold, the median residential property selling price has exhibited resilience, registering a 32.6% increase from November 2020 to November 2023, reaching $249,900.

Monthly Detail Comparison:

Nov. vs Oct.: -7.9% | Nov. ’23 vs Nov. ’22: -3.5% | Nov. ’23 vs Nov. ’21: -31.3%

Examining the month-on-month and year-on-year comparisons provides a nuanced understanding of the market dynamics. November 2023 witnessed a 3.5% decrease compared to the same month in 2022, reflecting a temporary slowdown in the market.

Key Metrics:

  • Number of Homes Sold: 5,488
  • Number of Days on Market: 36
  • Average Selling Price: $294,477
  • Median Selling Price: $242,250
  • Monthly Dollar Volume: $1,616,089,468

Kansas City, Missouri Housing Market Report

Kansas City Housing Market Trends
Credits: Kansas City Regional Association of Realtors (KCRAR)

Located on the Missouri River at the confluence with the Kansas River, the city is contiguous with Kansas City, Kansas. But most of Kansas City lies within Jackson County, Missouri. A large, prosperous, self-sufficient, and culturally rich city, it is no wonder why it has seen a continuous rise in its employment, directly impacting the local real estate.

Here are the Greater Kansas City housing market statistics for December 2023 as reported by the Kansas City Regional Association of Realtors (KCRAR).

  • In the Greater Kansas City housing market, the average sales price is up +2.7% to $336,455.
  • Home sales in the Kansas City area totaled 2346 units in December, down 7.2 percent from the same month in 2022.
  • Pending sales were up by 8.9% to 2052 properties being under contract.
  • Homes that sold in December were on the market for an average of 41 days and sold for 96.6 percent of their original asking prices.
  • The number of active listings decreased by 8.9% year-over-year, which makes the supply equal to 1.8 months (up 5.9% YoY).
  • Months’ supply refers to the number of months it would take for the current inventory of homes on the market to sell given the current sales pace.
  • It is a good indicator of whether a real estate market favors buyers or sellers, and Kansas City is a seller’s market.

Kansas City, MO Housing Market Forecast for 2024

Kansas City’s housing market is one of the most affordable in the nation. It is one of the hottest real estate markets for affordable rental real estate investment. What are the Kansas City real estate market predictions? Based on the current data and trends, there is no indication of an imminent housing market crash in Kansas City. The market appears stable, with healthy demand and rising home values.

According to Zillow, the average home value in Kansas City is currently $224,794, experiencing a notable 6.0% increase over the past year. Homes in the area are typically pending in a swift 12 days, reflecting the brisk pace of the real estate market.

Key Housing Metrics and Trends

  • For sale inventory (December 31, 2023): 1,342 properties available for purchase.
  • New listings (December 31, 2023): 466 homes entered the market.
  • Median sale to list ratio (November 30, 2023): A strong ratio of 1.000 indicates balanced demand.
  • Median sale price (November 30, 2023): Homes are selling at a median price of $234,900.
  • Median list price (December 31, 2023): The median listing price stands at $221,667.
  • Percent of sales over list price (November 30, 2023): 38.0% of sales exceeded the list price.
  • Percent of sales under list price (November 30, 2023): 39.0% of sales were below the list price.

Kansas City MSA Housing Forecast

In the Kansas City Metropolitan Statistical Area (MSA), the housing market is anticipated to show promising growth. According to forecasts, from January 31, 2024, to March 31, 2024, there is a projected increase of 0.4%, and by December 31, 2024, the forecast suggests a substantial rise of 3.4%. These positive trends indicate a robust real estate market in the Kansas City MSA, offering potential opportunities for both buyers and sellers.

The Kansas City Metropolitan Statistical Area (MSA), encompassing regions in Missouri, is a significant economic and cultural hub. Comprising various counties, including but not limited to Jackson, Clay, Platte, and Cass, this MSA plays a pivotal role in the Midwest’s housing market. The forecasted trends for 2023 and 2024 provide valuable insights for those navigating the real estate landscape in this vibrant region.

Is Kansas City a Buyer’s or Seller’s Housing Market?

Given the brisk pace of sales, the Kansas City housing market leans towards being a seller’s market. The demand for homes appears to outpace the available inventory, providing sellers with advantageous conditions. Home prices in Kansas City are on an upward trajectory, experiencing a 6.0% increase over the past year. This indicates a trend of appreciation rather than a decline.

For potential buyers, considering the swift pace of sales and the competitive market conditions, now may be a good time to purchase a home in Kansas City. However, individual circumstances and preferences should be taken into account.

Kansas City, MO Real Estate Investment Overview

Is Kansas City a Good Place For Real Estate Investment? Many real estate investors have asked themselves if buying a property in Kansas City is a good investment. You need to drill deeper into local trends if you want to know what the market holds for real estate investors and buyers.  Kansas City is the largest city in the U.S. state of Missouri, famous for its distinct barbeque cuisine and jazz heritage. Also nicknamed the City of Fountains, Kansas City is now emerging as a growing market for real estate investments.

When we refer to the Kansas City housing market, it comprises the Kansas City metropolitan area, which is a bi-state metropolitan area anchored by Kansas City, Missouri. Its 14 counties straddle the border between the U.S. states of Missouri (9 counties) and Kansas (5 counties). It is the second-largest metropolitan area centered in Missouri (after Greater St. Louis) and is the largest metropolitan area in Kansas, though Wichita is the largest metropolitan area centered in Kansas.

Kansas City, MO is a minimally walkable city in Jackson County with a population of approximately 460,377 people. In the past ten years, the annual real estate appreciation rate has amounted to 2.88% in Kansas City, according to NeighborhoodScout.com. Kansas City has a mixture of owner-occupied and renter-occupied housing units. Three and four-bedroom single-family detached homes are the most common housing units in Kansas City. Other types of housing that are prevalent in Kansas City include large apartment complexes, duplexes, rowhouses, and homes converted to apartments.

If you are looking to make a profit, you don’t want to buy the most expensive property in the Kansas City real estate market and expect to make a good profit on rents. Perhaps you are looking for a slightly different hold-over, an investment property in Kansas City that you might move into or sell at retirement in the future. Either way, knowing your profit potential and purpose is the first thing to consider.

Top Reasons To Invest In Kansas City Real Estate

  • Kansas City is the largest city in Missouri and is the sixth-largest in the Midwest.
  • Kansas City has long been a favorite of real estate investors.
  • Affordable Turnkey Properties.
  • The largest city in the state of Missouri.
  • The population is expected to grow to 2,200,000 by 2020.
  • 1-year positive appreciation forecast (ZHVI).
  • #62 in the U.S. out of the top 100 MSAs – FHFA.

Overview of Kansas City & its Real Estate Market

Kansas City is a large, prosperous, self-sufficient, and culturally rich city located astride the Missouri River. In the metropolitan area, the population is estimated at 2.1 million. The median household income in Kansas City is 45,376 and the median home price is $146,300. Kansas City is the largest city in Missouri and is the sixth-largest in the Midwest. It hosts the Kansas City Chiefs as well as the Kansas City Royals. It’s home to some of the Best Ribs in America.

The city has over 200 water fountains, making it only second to Rome, Italy, hence the nickname “City of Fountains.” It is also important to remember that only Paris, France has more Boulevards. In 2017, a WalletHub survey for real estate market growth in the United States listed the “Kansas City Real Estate Market” at number 18 out of 300 of the fastest-growing cities in the US.

Kansas City has started to do some major revitalization downtown. More than $6 million has been spent giving the downtown area a facelift and new makeover, including, apartments, offices, and condominiums. These facelifts have also been done in both indoor and outdoor malls, restaurants, and places for concerts, plays, and other forms of entertainment. Kansas City real estate is very affordable; the home prices are near the national average. All of these make Kansas City properties attractively appealing to investors and homebuyers who are looking for gains in cash flow.

Employment in Kansas City

Employment in Kansas City is diverse, with major industries including healthcare, finance, and manufacturing. The city has a low unemployment rate and a growing job market, making it an attractive place to live and work. The unemployment rate in Kansas City, MO, is currently at 2.80% for March 2023, which is lower than the long-term average of 6.06%.

This rate is slightly higher than the 2.7% reported in February 2023. Comparatively, the US average unemployment rate is 6.0%. This indicates that the unemployment rate in Kansas City is significantly lower than the national average.

Kansas City is experiencing a period of growth, with a thriving job market, a vibrant arts and culture scene, and numerous new development projects. The city’s population is also steadily increasing, with more people choosing to call it home. This growth is expected to continue in the coming years, making Kansas City an attractive destination for businesses and individuals alike.

Great Place to Live Due To Rich Culture & Favorable Weather

The city is known for its distinct barbeque cuisine and uniquely crafted breweries, which makes it a preferred destination for foodies. It has more than 100 barbecue restaurants and is known in Missouri as the “world’s barbecue capital. The ancient heritage of Jazz music makes it suitable for immigrants who are passionate about music.

The city lies on the shores of the Missouri & Kansas Rivers with a landscape full of fountains. The overall ambiance and accommodating culture are sure to attract more and more residents into the city, which will prove to be a boon for investments in Kansas City Real Estate Market. The weather in Kansas City is beautiful and usually clear and sunny.

September, May, and June are the most pleasant months in Kansas City, while January and December are the least comfortable month. You can almost always count on the 4th of July to be a great day to BBQ and shoot off fireworks and watch your neighbors shoot theirs, creating a competition. The neighborhood fireworks shows have always been as big as the city’s, only the last half of the night.

During the shows, everyone in the neighborhood waters the top of their houses for a week straight to avoid catching fire. Where else in America can you find that? Even better, the people are friendly and the weather is inviting. There are nearby lakes for boating, fishing, swimming, and camping. The weather is almost always enjoyable. They get most of their rain in the spring of April and the summer month of June.

Cost of Living in Kansas City

Another great factor that is seen as a boon to the Kansas City real estate market is the cost of living. The cost of living in Kansas City is reasonable and affordable. With the cost of rent and the price you might pay for a house already discussed, there’s the cost of day-to-day expenses to consider. A basic lunch around the business district is around $12 unless you go to a fast-food restaurant and order a combo meal, then you’re looking at $7.

Milk is around $3.50 a gallon, a 2 lt. A bottle of Coca-Cola is $1.82. These prices are about the same as the national average at –1%. Housing is at 8% below. Kansas City is 15% below Oklahoma and 8% below Indiana. In fact, New York City is 129% above compared to Kansas City, while 14% below Miami, Fl, and 23% below Chicago.

Summary of the cost of living in Kansas City:

  • Four-person family monthly costs: $3,331.71 without rent.
  • A single-person monthly costs: $935.08 without rent.
  • Rent Prices in Kansas City, MO are 32.81% higher than in Wichita, KS
  • Rent Prices in Kansas City, MO are 63.21% lower than in New York, NY.
  • Rent Prices in Kansas City, MO are 26.01% lower than in Atlanta, GA

Rich and Stable Neighborhoods

The city is surrounded by neighborhoods like River Market District as well as the 18th & Vine District and the Country Club Plaza on its north, east & south sides respectively. These vicinities, in combination with the city’s vibrant real estate market, comprise all amenities residents and non-residents alike can take advantage of and put their investments in.

Some of the best neighborhoods in or around Kansas City, Missouri are Waldo, Raytown, The Downtown Loop, Northland, Westwood Hills, Patrician Woods, Chapel, Pendleton Heights, Crossroads, Turner, Westwood, Downtown Kansas City, Ward Parkway, Lake Quivira, Nashua, Shawnee Mission, and Briarcliff-Claymont.

Good Neighborhoods in Kansas City To Invest in Real Estate

  1. The Johnson County of Kansas City: It is high on the list of home buyers as an ideal place to raise a family. It has highly accredited school districts within the county, which include Shawnee Mission, Gardner Edgerton, Spring Hill, Blue Valley, Olathe, and De Soto. Most subdivisions see steady property valuation increases year after year.
  2. The Prairie Village, Kansas City: It is another good neighborhood with low crime rates, mature trees, plenty of quiet neighborhood parks, and accessible community pools.
  3. Leawood, Kansas City: It is a low crime rate area and it’s safer than 79 percent of U.S. cities. The residents have a median household income of $133,702, so they are quite well off. The region is home to the biggest Methodist church in the nation – the United Methodist Church of the Resurrection.
  4. Lenexa, Kansas City: This neighborhood has a median listing price of $394,000. Fifty-four percent report some school education, contrasted with the national average of 22 percent for all cities and towns.

Low median sales prices, which in return, drive a solid rent are another reason to look into the Kansas City real estate market. Add to that the weather, the many activities at your disposal, and the famous “Kansas City BBQ.” There isn’t much left to desire when investing in the real estate market. Take a look around, make some calls, and talk to some of the people around Kansas City before you decide.

Good cash flow from Kansas City investment properties means the investment is, needless to say, profitable. A bad cash flow, on the other hand, means you won’t have money on hand to repay your debt. Therefore, finding a good Kansas City real estate investment opportunity would be key to your success. The three most important factors when buying real estate anywhere are location, location, and location. The location creates desirability. Desirability brings demand. There should be a natural and upcoming high demand for rental properties.

The neighborhoods in Kansas City must be safe to live in and should have a low crime rate. The neighborhoods should be close to basic amenities, public services, schools, and shopping malls. As with any real estate purchase, act wisely. Evaluate the specifics of the Kansas City housing market at the time you intend to purchase. Hiring a local property management company can help in finding tenants for your investment property in Kansas City.

Here are the top ten neighborhoods in Kansas City having the highest real estate appreciation rates since 2000—List by Neigborhoodscout.com.

  1. South Hyde Park
  2. Westside North / Westside South
  3. 18th and Vine and Downtown East / Downtown East
  4. Crossroads
  5. Columbus Park
  6. River Market
  7. Longfellow
  8. Pendleton Heights
  9. Western 49-63
  10. Eastern 49-63 / Rockhurst University

Sources:

  • https://kcrar.com/media-statistics/market-statistics/
  • https://kansasrealtor.com/news-media/market-stats/
  • https://www.zillow.com/kansas-city-mo/home-values
  • https://www.redfin.com/state/Missouri/housing-market/
  • https://www.kansascity.com/news/local/article244912977.html
  • https://realestate.wichita.edu/data-research/data-by-market/kansas-market/
  • https://www.realtor.com/realestateandhomes-search/Kansas-City_MO/overview
  • https://www.neighborhoodscout.com/mo/kansas-city/real-estate/
  • https://www.fhfa.gov/DataTools/Downloads/Documents/HPI/Fact-Sheets/MSAs/2019Q4/FS-KansasCity-2019Q4.pdf
  • http://www.435mag.com/March-2017/Kansas-City-Real-Estate
  • https://www.corevestmentfinance.com/hot-markets-for-residential-real-estate-investors-2018

This post was originally published on 3rd party site mentioned on the title of this site

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