Vermont home prices continue to increase in 2019

Vermont home prices continued to climb in the first six months of 2019, based on the latest data from Vermont Property Transfer tax records. The median home sold for $219,500, a roughly 2% increase from 2018.

Sale prices increased for every home type in Vermont during the last six months. The median single family home sold for $226,500, the median condominium sold for $209,950, and the median mobile home with land sold for $80,000.

Nationally, home sales have been uneven for the past year and a half. The number of national home sales in every month of 2018 and the first half of 2019 were lower than the previous year. During the same time, prices rose by 4.3%, with the median national home sale price reaching $285,700 in June. Economists blamed the slowdown in sales on the rising prices and an overall lack of inventory, particularly in more affordable homes. However, July saw a higher than predicated number of home sales in the U.S., largely due to a new reduction in mortgage rates resulting from the Fed’s interest rate cuts. It is too soon to say whether this national increase in sales will last, but a prolonged slowdown in new construction is likely to continue to contribute to the general lack of available homes for sale.

Vermont’s housing market has always been different than the rest of the country, with fewer highs and lows in sales and price trends. While home sales slumped nationally, the number of Vermont homes sold increased from 2017 to 2018. Preliminary reports from Multiple Listing Service (MLS) suggest that 2019 sale numbers are similar to 2018 sales, though we won’t know if there will be a boost related to the new mortgage rate cuts until later in the year. However, like the rest of the country, Vermont home prices are continuing to climb, with home prices rising every year since 2014, at an average rate of 2.7%.

This sustained increase in prices continues to be concerning for our state, as incomes for low and middle-income households have grown very slowly and even declined in some years over the past decade. To afford the current median home price of $219,500, a household would need to earn at least $62,810, yet the median household income in Vermont is just $57,808. 

This imbalance between incomes and home prices can make it difficult to save enough to purchase a home, especially for first-time buyers. Fortunately, Vermont Housing Finance Agency’s homeownership programs can help young homebuyers, including down payment and closing cost assistance up to $5,000.