Hot Real Estate Market In Topeka

This house at 907 SW Anderson Terrace, Topeka, sold in two days, $10,000 over asking price. 

By Michael Hooper

Houses are selling fast in Topeka as the community struggles with an historic low number of houses for sale.

Homes in Shawnee County that sold in July were typically on the market for three days and sold for 100 percent of their list prices, according to the Sunflower Association of Realtors.

Total home sales in Shawnee County rose by 3 percent in July to 273 units, compared to 265 units in July 2019. Total sales volume was $47.2 million in Shawnee County in July, up 17.9 percent from a year earlier. The median sale price in July was $151,000, up from $143,500 a year earlier. 

"The market is hot hot hot," said Helen Crow, agent with Kirk & Cobb.

The total number of active listings in Shawnee County at the end of July was 186 units, down from 344 at the same point in 2019. This represents less than one month's supply of homes available for sale, according to page 255 on Sunflower Association's July report.

"We have the lowest inventory of homes for sale since the troops came home from World War II," said Crow. "There was a housing crunch back then. In 1973, housing was tight but not like this, this is just crazy. We used to have 700 to 900 houses for sale."

A constrained housing supply will lead to more increases in value of the property, she said. 

A good example of what is happening in the market is 907 S.W. Anderson Terrace, my neighbor's house. The three bedroom house went on the market for $110,000 on Friday, Aug. 14. By Monday, Aug. 17, the house had been sold. Multiple offers came in for the property. Crow said she advised her client to bid $10,000 over the asking price and his bid was accepted.

The median list price of homes on the market at the end of July was $153,425. During July, a total of 269 contracts were written up from 237 in July 2019. At the end of the month, there were 320 contracts pending, compared to 311 at the end of July 2019.

The city of Topeka found 1,008 vacant homes without water service in January 2020, Crow said. There are others with water on but still vacant, so there could be more housing stock available, she said. Many of those homes are in terrible shape. Some are OK, but the owner is not motivated to sell for some reason. Crow herself said she is holding onto a childhood home that she should be selling. "I probably need to see a psychiatrist," she said.

Crow said nationwide inventory levels have been falling. There used to be 2 million existing homes for sale in 2019. In June 2020, that number fell to 1.57 million, according to ycharts.

Millennials want to buy a home but Baby Boomers are living longer and staying in their homes, she said.

Another possible reason inventory is so low is some people had considered selling their home in 2020 but when the Covid-19 crisis hit in March, they delayed their plans and stayed put.

Jeff Huckabay, real estate agent with Reece & Nichols, said 2020 started slow, but picked up in the spring, even though the Covid-19 crisis hit.

"This year has been different with Covid-19 but basically it's been a frenzy," he said. "There is not enough inventory. Sellers are getting top dollar. It's a sellers market."

Sometimes, he said, he schedules a buyer to see a home, but by the time they get there, it's almost sold. For example, a couple wanted to buy a home after seeing it in the morning, but the agent for the house said offers were being presented to the seller at 11:30 a.m. that same day. He and his client had 30 minutes to present an offer. Their offer was $6,000 over asking price and they dropped the inspections in order to make the deal happen.

A buyer who is offering below the asking price will likely not get the deal, he said.

Sunflower Association of Realtors represents Brown, Greenwood, Jackson, Jefferson, Lyon, Nemaha, Osage and Shawnee counties.

Total home sales in the Sunflower multiple listing service rose by 10.1% last month to 445 units, compared to 404 units in July 2019. Total sales volume was $75.4 million, up 17.4% from a year earlier. The median sale price in July was $146,000, up from $145,000 a year earlier. Homes that sold in July were typically on the market for 5 days and sold for 100.0% of their list prices. 

The total number of active listings in the Sunflower multiple listing service at the end of July was 451 units, down from 786 at the same point in 2019. This represents a 1.4 months' supply of homes available for sale. The median list price of homes on the market at the end of July was $168,000.

During July, a total of 398 contracts were written up from 370 in July 2019. At the end of the month, there were 509 contracts pending, compared to 476 at the end of July 2019.