Iowa Housing Market Gains Momentum in May

WEST DES MOINES, Iowa – Iowa’s housing market showed signs of steady growth and renewed progress in May, with rising inventory levels, stable sales, and continued price gains signaling increased confidence from both buyers and sellers as the summer season kicks off.

“May’s housing numbers show a continuation of promising momentum across both single-family homes and the condo-townhome market,” said Travis Bushaw, Iowa REALTORS® president. “A strong increase in active inventory and a steady climb in closed sales signal a market that’s still gaining traction heading into summer. While some metrics show only modest changes month-to-month, the year-over-year gains in listings and prices reflect growing seller confidence and sustained buyer demand. We're seeing the market shake off a slight slowdown in late spring and head into the summer with positive energy.”

Single-Family Home Market
New listings in May jumped 7.3% to 4,655, from the 4,337 new listings that joined the market one year ago. While it’s clear homeowners are seeking to join to get an early start on the typically busy summer housing market, monthly metrics show that many made those moves earlier in spring. New listings dropped slightly - just 0.8% - from the 4,667 new listings recorded in April. 

Active inventory increased a healthy 20.3% to 8,314 homes on the market compared to the 6,909 homes listed for sale in May 2024. Monthly, the increase was less dramatic, about 8.8% higher than the 7,969 homes listed one month ago. 

Closed sales for May highlighted a stable market year-to-year, decreasing just 0.2%, a fluctuation that could be attributed to the busy nature of May with graduations and school years ending. In all, 3,414 homes closed in May, a slight dip from the 3,428 closed sales of a year ago. Conversely, the figure represents a 19.7% increase from April, when 2,851 homes sold. 

Median sales price increased 5.9% year-over-year to $252,000. Monthly, the change was similar at a 5% increase from $239,500. 

While median days on the market increased by one day from 2024 to 11 days on the market. Monthly, the increase was two days from the median of nine days recorded in April. 

“We’re seeing encouraging signs that both buyers and sellers are re-engaging as we move into the summer season,” said Les Sulgrove, statewide housing analyst. The growth in listings and prices reflects a market finding its rhythm after a slower spring start.”

Condo-Townhomes 
The condo-townhome market proved resilient in May, seeing a number of seasonably expected increases. 

New inventory faltered slightly in May with 650 new listings hitting the market, a 5.4% decrease from a year ago, and a 6.7% decrease from April. Active inventory, however, remained robust with 1,836 townhomes and condos on the market in May, a 22.5% increase from the 1,500 properties listed one year ago. Monthly, active inventory jumped 3.6% from the 1,756 properties for sale. 

Closed sales increased 1% from May 2024, with 509 sales recorded last month. Compared to April, townhome and condo sales jumped 35.7% in May. 

A Balanced Market
In a balanced housing market, supply and demand is equal, meaning there are enough homes for sale to satisfy the number of buyers. While that’s an ideal scenario, it’s rarely an actuality. 

However, analysis shows that a range of supply and demand can ensure successful home buying and selling in any market. In Iowa, we view a balanced market through a range of supply available, typically measured as four to six months of available inventory. 

Sulgrove notes that with 2.1 months of inventory available through existing homes, our market would generally be seen as a seller’s market. 

“We have more buyers than we do sellers, that’s good for sellers, but not so much for buyers,” he said. “When you look at new construction, though, you see a flipped market, they are in a buyers market for that category. That’s fairly typical for new construction.” 

While the market can be seen as more favorable to sellers currently, Sulgrove notes we’re not far off from what is considered balanced - favoring both buyers and sellers equally, especially heading into the summer months where more homeowners typically jump into the market.