The Downtown Ann Arbor Condo Market is Changing… Once Again!
The market in 2023 will be one where both buyers and sellers are going to feel some pain. For
the past 6-7 years, buyers and sellers were happy. Sellers were happy because they were
getting great prices for their downtown Ann Arbor condos, and buyers were happy because they were able to buy in an appreciating market.
In 2023, buyers may be frustrated because they can afford less home than they could 1 year
ago. A buyer that could afford a $650,000 home at the beginning of last year, can afford a $450,000 home this year – all things being the same. Affordability challenges will continue to limit
the buying power of some. Sellers may be disappointed as they look back at the crazy
spring market they missed out on, where buyers were writing offers over list price – sometimes
as much as $100,000 over list price – and realize that they will have to accept a more reasonable
sales price that isn’t driven up by multiple offers.
We are also competing with a lot of new luxury apartment construction in the downtown area
which is very attractive to U of M students and young professionals who are renting versus
buying.
To get a feel for the strength of the resale market we look at the months supply of inventory. A
balanced market is 4-6 months. Anything below 4 months is a seller’s market and anything above 6
months is a buyer’s market. With a 2.2-month supply of condos in downtown Ann Arbor, we are
in a seller’s market, which should encourage multiple offers and over-list price offers, however
every re-sale condo sold for less than asking which tells a different story.
What’s Going to Happen in 2023?
Moving into 2023, I believe that despite the high-interest rates, high inflation, and the down stock
market, the downtown real estate market will remain steady based on the lack of inventory – both re-
sale and new construction. We are watching the trends very closely to see how the spring market
shapes up and will be sure to give an update at the end of the 1st quarter.
As always, condos that are priced correctly and in tip-top shape are always in demand. Ann Arbor
has a strong economy, and there is always a lot of movement into and out of the area.
As the market changes, be sure to get the most current information so you can make the right
decision. Should you wish to discuss the market in-depth, contact us at 734-761-3060 or info@bouma.com. We remain cognizant of the upcoming condominium and housing projects and are aware of upcoming inventory. It would be our privilege to work with you! Feel free to stop in and visit us anytime – we are located downtown, at the corner of S. Main and Madison.
Want the statistics we’ve gathered for the 4th quarter? Get the full report, stats included, here!
