The statement that the Grand Rapids market has cooled is only half true. In October, the number of active listings in the Grand Rapids-Wyoming metropolitan area reached 2,368, a 25.2% increase from 1,892 a year ago. However, the median listing price rose to $395,000, an increase of 1.3%.

Let me clarify the sources. The October listings and prices are based on Realtor.com data from FRED, while rental information comes from the Apartment List November report and RentCafe.

The actual transactions are reported by the Grand Rapids Association of Realtors (GRAR), with the latest available data from September. Please read all transaction figures as of September.

In October 2023 alone, there were 1,487 listings. Those looking at homes will certainly feel a difference. However, this is still below the 3,066 listings from October 2019.

Interestingly, the new listings in October totaled 1,084, which is a 13.6% decrease from 1,254 a year ago. I believe this indicates that while new homes are not flooding the market, existing homes are not selling quickly.

The median time on the market has also increased to 43 days, compared to 41 days last year.

There were 1,148 listings with reduced prices, which is more than last year's 1,006. However, the ratio compared to active listings is 48.5%, down from last year's 53.2%. It's too early to say that everyone is cutting prices.

The drop in listing prices from $432,475 in June to $395,000 in October should not be overstated. Last year, prices also fell from $424,950 in June to $389,900 in October.

Now, regarding actual transactions. The residential closings in the GRAR region, which includes Kent County and some surrounding areas, totaled 877 in September, a decrease of 4.8%. The average sale price was $418,212, which is a 5.2% increase.

What I found most noteworthy is the pending sales. The number of pending residential sales in September was 776, down 16.5% from 929 last year. This indicates that the number of closings may weaken in the future.

Still, the inventory based on pending sales is 2.4 months, and the average days on market for September closings was 23 days, shorter than last year's 25 days. The earlier figure of 43 days is not directly comparable as it pertains to a different dataset. Homes that are selling are still selling quickly.

Even within the same living area, conditions vary. The average sale price in Kent County for September was $432,738, up 3.8%, while Ottawa County saw a modest increase to $489,740, up 1.4%.

In Ottawa, new listings increased by 16.2%, while closings decreased by 13.0%. In Kent, the respective decreases were 2.2% and 6.2%. The average days on market were 31 days in Ottawa and 23 days in Kent, indicating that Ottawa appears to be cooling off more.

Of course, Ottawa includes lakeside areas like Holland, so judging neighborhoods solely by county averages can be misleading. Check the GRAR FastStats for specific areas of interest.

As for interest rates, Freddie Mac reported on November 5 that the 30-year fixed rate is at 7.18%. It has decreased from 7.40% in mid-October for three consecutive weeks, but it is still 0.96 percentage points higher than last year's 6.22%.

I did some calculations. If you put down 20% on a $395,000 home and borrow $316,000 at a 30-year fixed rate, your monthly payment at 7.18% would be $2,141, compared to $1,940 at 6.22%. That's a difference of $201, not including property taxes and insurance.

According to Apartment List, the median rent in Grand Rapids is $1,434. It decreased by 0.6% in October but is up 2.6% from a year ago. Over the past year, Michigan's average rent increased by 3.5%, while the national average rose by 0.1%.

RentCafe reports an average of $1,643 as of October 30. This includes $1,493 for one-bedroom, $1,706 for two-bedroom, and $2,203 for three-bedroom units. Since the calculation methods differ, it's best to view these as ranges.

The differences in rent are even more pronounced by neighborhood. According to RentCafe, Alger Heights averages $1,261, while Downtown is at $1,889 and Belknap Lookout at $1,945. That's a $684 difference within the same city.

Crossing city borders changes the situation as well. According to Apartment List, the median rent in the neighboring city of Wyoming is $1,266.

The earlier monthly payment of $2,141 is similar to the average rent of $2,203 for a three-bedroom. When you add property taxes, insurance, and maintenance costs, buying becomes more burdensome. Of course, these figures are not directly comparable as they pertain to different homes.

Property taxes are also crucial to consider. In Michigan, when ownership changes, the taxable value is reassessed the following year, so you can't rely solely on the previous owner's tax bill. Check with your city or township assessor's office.

If I were buying a home, I would first look at how many days it has been on the market since listing and the history of price reductions. Next, I would check the recent closing prices in the same neighborhood. Finally, I would review the recalculated property taxes and seller credits.

For sellers, the initial price is everything. A 2.4-month inventory is not a bad market, but homes that start at a high price can easily transition to being stale listings.

If you're a renter, check the new listings in the same complex and nearby neighborhoods before signing a renewal. Since rents dipped slightly in October, you have a reason to ask.

My conclusion is this: we are not in a market flooded with distressed sales, but rather in a market where there are more homes available for negotiation. For serious buyers, I would start looking at listings that have been on the market for over 40 days.

The next figures to watch will be the pending sales in the GRAR October report. Loan conditions and taxes vary by individual circumstances, so be sure to check with your lender and tax professional before making any agreements.