WICHITA, Kan. (AP) — Kansas home sales rebounded this year and are forecast to rise another 6.3 percent in 2013 as the economy improves and pent-up demand brings buyers back into the housing market, economic researchers at Wichita State University said Thursday.
The forecast, "Picking Up Steam," released by Wichita State's Center for Real Estate shows home sales in Kansas are on track to rise by nearly 13 percent this year led by strong growth in the northeast of the state. Meanwhile, home prices are appreciating by nearly 2 percent on average statewide this year, with a projected 1.5 percent increase in home values next year.
New home construction is on pace to rise only slightly his year as declines in Wichita offset strong gains in Kansas City, Lawrence and Manhattan. The report predicts construction in Kansas will fall by 7 percent in 2013, driven in part by high building costs; Buyers can purchase relatively new homes for far less than it costs to build new houses.
"All of the major markets are seeing increases for this year and projected into next year for home sales," said Stan Longhofer, director of the Center for Real Estate. "It is a broad-based recovery of the housing market that really reflects, I think, a solidifying of the underlining economic environment and the fact that people's lives move forward."
Most housing transactions are driven by need — a growing family, a job change — Longhofer said in a phone interview.
"The underlying economic challenges that have been really pressing down on the housing market here in recent years have eased ... so the fundamental forces that bring people back into the housing market are starting to take hold again," he said.
On the upside, inventories of available homes have whittled down to the point that there is about a six-month supply of homes on the market, driving up home prices that have been flat or falling for the past couple of years, Longhofer said.
"We are moving from what might have been a buyer's market, not into a seller's market but at least a balanced market," he said, adding that this could lead to "some price appreciation."
Nowhere in the state is the housing turnaround more evident than in metropolitan Kansas City, where home sales this year are on pace to grow nearly 18 percent. And that growth is expected to continue, but at a slower pace of about 5 percent, next year.