RE: Real Estate Podcast

Clint C. Galliano (00:00)
The median sales price across the value board jumped 15% over last July. Before anybody celebrates or panics, we're going to show you why that one number is the least useful thing on the page. Let's talk about it.

Ben Harang (00:30)
Hello everybody and welcome to another episode of the RE Real Estate Podcast. My name is Ben Harang and with me today as usual is my co-host Clint Galliano. Clint, how you doing today, man?

Clint C. Galliano (00:45)
Do wonderful, Ben. How you doing?

Ben Harang (00:49)
I'm doing terrific on a afternoon in South Louisiana. We don't have any rain yet, but the heat and humidity is out of this world or are out of this world. My bald head goes outside and if I don't have a cap on it, I can feel it quickly. But they say the change is coming.

Clint C. Galliano (01:07)
Yeah, I'm trying to do that

that's what they say. We'll we'll see how that turns out. I've been

Ben Harang (01:13)
Right.

Clint C. Galliano (01:13)
keeping most of my my activities inside, you know. My wife commented on Facebook saying, he's got all this stuff's in here 'cause I'm working on props for the light show But it's like I'm not

Ben Harang (01:26)
Mm-hmm.

Clint C. Galliano (01:26)
gonna sit in the garage at ninety nine degrees when I could be in seventy two degrees in the house.

Ben Harang (01:32)
Uh-huh,

uh-huh. Well, I took to cutting my grass at 6.30 in the morning. It's brutally hot in the afternoon, and if I miss a day with rain, then it just gets worse and worse. So I can control it a little bit more even though it's wet. So anyway, what are we talking about today, Clint?

Clint C. Galliano (01:52)
All right, well it's that time of the month. it's time for the monthly market update. So we've got July numbers for the Bayou Board region, which covers Terebonne, Lafourche, Assumption, and St. Mary Parishes. And the reason we do it is we we compare the region versus the individual parishes, is because the regional number and the parish numbers don't necessarily tell the same story.

regional numbers are an average of everything going on where the parish numbers tell us what's going on in each individual parish. And that gap there is where the useful information lies. So fair warning before we start. July is just one month and in a couple of these parishes we're talking about a handful of sales. So we'll tell you which numbers to lean on and which ones to leave alone.

Ben Harang (02:48)
The Bayou Board report has the July median sales price at $230,000. Last July, that number was $199,000. That's a 15 % higher in 12 months, and that's a number everybody's going to quote you.

Clint C. Galliano (03:07)
Slide over one column on that same report, year to date, the median went from two hundred ten thousand dollars to two hundred fifteen thousand, two point four percent. That is the number that actually described what happened in our market this year.

Ben Harang (03:25)
and here's what makes it interesting. On that same report, the year-to-date average sales price actually went down from $230,700 to $228,600.

Clint C. Galliano (03:41)
As we've discussed every time we do a a market update, median and average are not the same animal.

Ben Harang (03:47)
Mm-hmm.

Clint C. Galliano (03:48)
The median is is the house in the middle of the list. The average adds up every sale and divides it by the number of sales.

In a market our size, one big camp closing or a really nice property will drag an average around and can't touch the median.

Ben Harang (04:08)
Right. So the closed sales year to date, the Bayou Board has us at 984 closing against 848 through July of last year. That is a 16%. That's 16 % more families sitting at the closing table.

Clint C. Galliano (04:26)
That's crazy. That's like a hundred and thirty six more closings.

Ben Harang (04:30)
That is crazy. And we're just over halfway.

Clint C. Galliano (04:35)
Yep. Now on the supply side, things went in the opposite direction. And if you've listened to our last at least three market updates, we've been telling you that's what's going on. New listings year to date, fourteen hundred and eight last year.

twelve hundred seventy nine this year. So we're down nine percent. More buyers are showing up, fewer sellers are showing up.

Ben Harang (05:05)
So the inventory of homes on the Bayou Board report went from 933 homes last July to 772 this July. 17 % fewer houses are on the

Clint C. Galliano (05:22)
That that number of active listings is 161 less. That's

Ben Harang (05:29)
Mm-hmm.

Clint C. Galliano (05:29)
crazy too. So month supply for the whole board went from eight months down to five point seven. That's a twenty nine percent drop, and five point seven is the tightest this region has been in in a good while.

Six months is the line that most people use for balance. So that kind of tells you where that sits.

Ben Harang (05:53)
That's the first time board-wide we've been below six, below six months since we've been doing these updates. But here's the one that got my attention. Days on the market until sale actually went up, not down. It's 92 days last July and 102 days this July. It's only 10 days, but it's still going in that direction.

Clint C. Galliano (06:18)
And at the same time, the percent of list price received went up from ninety five point two to ninety six point six. So homes are taking longer and sellers are keeping more of their asking price. Those two things sounds like they should not happen together.

Ben Harang (06:39)
You're right, you're right. The Bayou Board also tracks a housing affordability index. It went from 138 last July to 121 this July, down 12%.

Clint C. Galliano (06:55)
And looking at the the individual market updates or remembering the individual market updates that we've done this year, I wanna say at one point we got up to a hundred and forty two, one hundred and forty-three, somewhere around there. And so,

Ben Harang (07:16)
Mm-hmm.

Clint C. Galliano (07:17)
you know, it was getting more affordable, but I think potentially with, interest rate spikes and stuff.

that's coming down. Combination of that and lack of inventory.

So what the index is really saying is that the same paycheck buys less house than it did last summer. Prices have firmed up. Rates did not come down enough to cover the difference. And like I mentioned, we had a few spikes. and buyers feel every bit of that at the closing table.

Ben Harang (07:49)
Tell me Clint, is this a good market or a bad market?

Clint C. Galliano (07:52)
It depends on where you at. That's always the answer.

Ben Harang (07:56)
Okay. So now we go

parish by parish, RPR's Lafourche report has months of inventory at 5.4, and RPR labels Lafourche a seller's market.

Clint C. Galliano (08:10)
RPR's Terebonne report comes in at six point one eight months, with l which lands right on balanced. What I want people to hear is the direction. That is down twenty-eight percent from a year ago.

Ben Harang (08:26)
And then you cross over into assumption parish and it's a different world. RPR

has assumption at 10.8 months of inventory and it's the only one of the four that went up year over year. It's up 25%.

Clint C. Galliano (08:42)
RPR's St. Mary report is right there with it at ten point five months. So inside one board, half of our footprint is in a buyer's market and the other half is not.

Ben Harang (08:57)
Let's look at what sellers are actually collecting. RPR has Tarabon at 97.8 % of list price and Lafourche at 97.2%.

Clint C. Galliano (09:07)
Assumption is at 95.5 in St. Mary is at 94.5. Put a real number on that. On a $230,000 house, the gap between 97.8 and 97.4.5 is about $7,600 out of the seller's pocket.

Ben Harang (09:31)
Median days on the parish reports. Terebonne 41, St. Mary 44, Lafourche 63, and Assumption 92.

Clint C. Galliano (09:39)
It's an interesting distribution.

Ben Harang (09:41)
It is.

Clint C. Galliano (09:43)
St. Mary's the one that does not add up at first. Ten and a half months of supply, but the houses that sell are selling in forty-four days. What that tells you is the ones that are priced right move fast, and the rest of that inventory just sits there and never shows up in the days on market number at all.

Ben Harang (10:06)
So the median sold price by parish for July. Terebonne $235,000, Lafourche $235,000, Assumption $200,000, and St. Mary $193,000.

Clint C. Galliano (10:24)
I put Terebonne's 235 next to Terebonne's median estimated value, which RPR puts at $216,000. The houses actually trading are running about $19,000 ahead of the typical house in the parish. Updated, move in ready, priced right.

Ben Harang (10:44)
And Lafourche has the priciest inventory on the board right now. RPR has a median active list price at $259,000 and that's the highest it's been in five years.

Clint C. Galliano (10:59)
Hey, I've been around for that long in real estate.

Ben Harang (11:01)
Yeah.

Clint C. Galliano (11:03)
before anybody quotes us on Assumption, understand what we're working with. Assumption Parish closes a handful of houses in a month. One sale moves that median. Treat Assumption & Saint Mary as direction, not necessarily gospel.

Ben Harang (11:20)
Right. So what's it say about what's coming up? Everything we just went through is history. Closed sales tells you what already happened. If you want to know what the next month looks like, you look at what went pending in July.

Clint C. Galliano (11:36)
RPR has assumptions new pending median list price at one hundred and forty four thousand two fifty. That's down thirty percent in one month.

Ben Harang (11:47)
Wow. St. Mary went in same direction. New pending at $152,500 went down 21%.

Clint C. Galliano (12:00)
So when those two parishes report lower medians in September, don't let anybody tell you the market crash. That's a mixed shift. The houses going under contract right now are the cheaper ones, and that pulls the median down without a single seller cutting their price.

Ben Harang (12:20)
Lafourche went the other way. RPR has new pendings at $246,000, up almost 8 % for the month.

Clint C. Galliano (12:31)
Terebonne has two hundred forty nine thousand five hundred sitting in pending status, waiting to close about a point and a half.

Those two parishes should print firm numbers this fall.

Ben Harang (12:47)
And the buy your board numbers, back it up. Pending sales year to date 900 last year, 1,037 this year. That's up 15%.

Clint C. Galliano (12:59)
Brings up the question we get every month. The board report says 5.7 months of supply. The parish reports say 5.4.6, 6.18, 10.5, 10.8. They're all right. They're just answering slightly different questions.

Ben Harang (13:21)
what do you do with this if you're buying or selling?

If you're selling in Lafourche or Terebonne, the data says price it at the market and you get somewhere north of 97 % of your asking price. And you're looking at roughly six to nine weeks.

Clint C. Galliano (13:38)
You're selling in Assumption or Saint Mary, price isn't really part of your strategy. Price is the whole strategy. With ten months of inventory, the buyer has options and your house has to be the best one in their list the week you're they're looking.

Ben Harang (13:56)
If you're buying anywhere in this region, there are about 160 fewer houses on the market than there were this time last year. There's less to pick from than you probably expect.

Clint C. Galliano (14:10)
But if you're buying an assumption or Saint Mary, you have the leverage of Lafourche buyer doesn't have closing costs, repairs, rate buy down, all of that is a real conversation in a market with ten months of supply.

Ben Harang (14:26)
And that affordability index is exactly why the lender conversation comes before the house hunting, not after. 12 % is a real bite.

Clint C. Galliano (14:37)
Don't shop the headline. Shop your parish, honestly. Shop your neighborhood. Cause these parishes are big and the numbers move around inside them too.

Ben Harang (14:49)
So the bottom line for July, the region is tightening, prices are firming, sellers are keeping more of their asking price, and one average spread across four parishes is hiding two completely different markets.

Clint C. Galliano (15:06)
It's crazy. And ultimately I I think why the region average is closer to Terebonne and Lafourche numbers is because that's where the volume of the transactions are happening.

Ben Harang (15:19)
Right. Assumption

& St. Mary are smaller and their numbers don't pull the average.

Clint C. Galliano (15:25)
All right, guess what time it is?

Ben Harang (15:28)
I'm not doing it. I'm not going to do any homework, Clint.

Clint C. Galliano (15:34)
here's the homework for the month. look up your own parish in this episode, not the regional number, and write down two things months of supply and percentage of list price received. Then call me and I'll tell you what those two numbers mean for your house specifically. Nine eight five six seven four four four seven nine. And if you don't feel like talking to me, you can call Ben.

And what's that number, Ben?

Ben Harang (16:04)
985-859-2500.

And both of

us were willing to talk without any obligation.

Clint C. Galliano (16:13)
That's correct. so and to make things easy, in the show notes we're gonna put a link to each of the different reports. So if you want to look over them on your own, you're more than welcome to. The links will be in the show notes.

Ben Harang (16:27)
if this was useful, do us a favor, like it, share it with somebody who you think, who's thinking about buying or selling and subscribe wherever you get your podcasts.

Clint C. Galliano (16:39)
New episodes every week and we run this market update right around the middle of the month or just after the middle of the month every month.

Ben Harang (16:47)
And all of this is available at rerealestatepodcast.com. I know it's a mouthful, so it's rerealestatepodcast.com.

Clint C. Galliano (16:55)
That's right.

RE: real estate podcast is all one word, and then you tack on dot com. And when you go there, you can check out Ben and I's profiles. You can look at the videos of us if you feel like looking at two old guys with faces for radio. And you can even ask a question. If you you're curious about something, you can ask a question on the website and it will come to us, and we might even do an episode about it.

Ben Harang (17:31)
It is. All right, Clint, that wraps up another episode. We're closing in on 100.

Clint C. Galliano (17:39)
Yes, indeed. We might do something special for the hundredth episode.

Ben Harang (17:44)
Yeah, might even have some bloopers in there. We don't have enough every week. So, all right, enjoy it and the other one's in the can. Have a good week.

Clint C. Galliano (17:55)
too.