Wichita (Kansas) home sales will fall slightly next year in the face of limited inventories according to the 2020 Wichita Housing Forecast published by the Wichita State University Center for Real Estate.
“Demand remains strong, especially for modestly priced homes,” said Stan Longhofer, director of the WSU Center for Real Estate. “Sales would continue to rise if there were more homes available on the market.”
The Wichita Housing Forecast is part of the 2020 Kansas Housing Markets Forecast series that reviews current housing market conditions in the major markets across the state – including Kansas City, Lawrence, Manhattan, Topeka and Wichita – and forecasts housing market activity through the end of 2020. The series also includes Housing Outlooks for 22 smaller markets across the state.
Kansas statewide forecast
- Home sales – Tight inventories caused Kansas home sales to fall last year for the first time since 2011. Sales are expected to drop another 2.3 percent this year before rebounding slightly in 2020, rising 1.2 percent to 40,290 units.
- Construction – New home construction activity across Kansas has slowed considerably this year as rising construction costs make it difficult to build the entry-level new homes that are most in demand. Permits should rebound modestly in 2020, rising 10 percent to 5,410 units.
- Home prices – Home price appreciation across the state remains strong due to tight inventories in the most popular neighborhoods and price ranges. Prices are forecast to rise 5.2 percent this year followed by another 4.4 percent increase in 2020.
Wichita forecast
- Home sales – Total home sales in the Wichita area are falling due to increasingly tight inventories. Sales are predicted to fall 0.9 percent in 2020 to 10,260 units.
- Construction – New home construction activity in Wichita remains stagnant, as rising construction costs continue to push buyers toward the existing home market. Next year should mark the eighth straight year that single-family permits in the Wichita area have hovered around the 1,000-unit level.
- Home prices – Wichita home values are increasing rapidly in the face of strong demand and tight inventories. The typical Wichita are home is forecasted to appreciate by 7.1 percent this year, followed by another 4.3 percent increase in 2020.
Kansas City forecast
- Home sales – Total home sales in the Kansas City area have been dropping this year due to increasingly tight inventories. Sales are predicted to rebound slightly in 2020, rising 1 percent to 38,540 units.
- Construction – New home construction activity in Kansas City has fallen sharply this year, as rising construction costs continue to push buyers toward the existing home market. Permitting activity is expected rebound somewhat in 2020, rising 16.4 percent to 5,440 units.
- Home prices – Kansas City home values appreciated by 9.2 percent last year in the face of strong demand and tight inventories. Strong appreciation is expected to continue, with rising 6.2 percent this year followed by another 4.9 percent increase in 2020.
Lawrence forecast
- Home sales – Total home sales in the Lawrence area have been dropping this year due to increasingly tight inventories. Sales are predicted to decline another 3.5 percent in 2020 to 1,390 units.
- Construction – New home construction activity in Lawrence remains stagnant, as rising construction costs continue to push buyers toward the existing home market. Permitting activity is expected end the year at 220 units and rise only slightly in 2020 to 225.
- Home prices – Lawrence home values have been increasing at a solid pace in the face of strong demand and tight inventories. The typical Lawrence are home is forecasted to appreciate by 4.3 percent this year, followed by another 3.7 percent increase in 2020.
Topeka forecast
- Home sales – Total home sales in the Topeka area have been dropping this year due to increasingly tight inventories. Sales are predicted to decline another 1.9 percent in 2020, falling to 3,080 units.
- Construction – New home construction activity in Topeka remains stagnant, as rising construction costs continue to push buyers toward the existing home market. Permitting activity is expected to fall to 225 units this year and then remain unchanged in 2020.
- Home prices – Topeka home values appreciated rapidly last year in the face of strong demand and tight inventories. The pace of appreciation is expected to slow somewhat, with prices rising 4.4 percent this year followed by another 2.9 percent increase in 2020.
Manhattan forecast
- Home sales – After strong gains in 2018, home sales activity in the Flint Hills region has slowed slightly this year. We expect sales in the Manhattan metropolitan area to end the year down 0.5 percent at 1,450 units. Sales should rebound solidly in 2020, rising 9.7 percent to 1,590 units.
- Construction – New home construction activity across the Manhattan metropolitan area has remained stagnant this year, as rising construction costs continue to push buyers toward the existing home market. Permitting activity is expected to increase only slightly in 2020, rising 4.8 percent to 220 units.
- Home prices – After modest gains over the past two years, home price appreciation in the Manhattan metropolitan area has begun to pick up this year. We forecast home values will rise 3.7 percent this year followed by another 3.6 percent increase in 2020.
For more information and a copy of each of the publications in the 2020 Kansas Housing Markets Forecast series, go to www.wichita.edu/realestate, or contact Longhofer at 316-516-6365 or stan.longhofer@wichita.edu.
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