It’s no secret that the real estate market is experiencing a much-needed and expected correctional shift. While this change needed to occur to help maintain a healthy real estate market, it’s important to look at some national housing data to see where we are in the big picture.
For instance, existing home sales declined nationwide for the eighth consecutive month, falling 1.5% as of last measure, the National Association of Realtors reports, with sales down nearly 24% from the same period in 2021.
Pending home sales also declined, dropping 10.9% month-to-month, exceeding economists’ expectations. Stubbornly high inflation and soaring borrowing costs have eroded buyer purchasing power and have caused the market to cool rapidly this year.
But there might be some good news concerning inflation. A recent report showing that the rate of inflation declined in October is good news for the real estate industry and possibly a bellwether of declining mortgage rates in coming months. Experts will be keeping a close eye on these rates in the following weeks.
While inflation shows some hopeful signs of stabilizing, affordability continues to be an obstacle for buyers and sellers. Mortgage rates have doubled since March and home prices remain elevated due to a limited supply of homes, although price gains are beginning to slow down.
As a result, many homeowners are waiting until market conditions improve to sell, while other sellers are increasingly cutting prices and offering concessions to attract a greater number of buyers.
So how does this national housing data fit in with us locally? In October, new listings in the Chattanooga region decreased 9% to 1,058. Pending sales were down 30.9% to 808. Inventory levels grew 55% to 2,049 units.
Prices continued to gain traction. The median sales price increased 10.9% to $305,000. Days on market was up 47.1% to 25 days. Buyers felt empowered as months supply of inventory was up 75% to 2.1 months.
These numbers are refreshing and in fact show signs of normalcy and stability coming back after the wild ride and frantic growth to our local markets over the past two years.
I had conversations last week with a number of industry professionals while attending the National Association of Realtors’ NXT conference and will be providing a more detailed account of our time there in next week’s column.
In short – and to not say too much too soon – the common theme in our industry is to get to work and to set our projections to where we were in 2020. The market was good then and the market is good now.
The past two years have created unrealistic expectations and the buzz in the news is just that – buzzing. News outlets are continuing to talk of the ups and the downs because the real estate market has become a popular topic and is monitored by consumers almost as much as the sports and the weather.
The housing market continues to shift every day, which is why it’s crucial to utilize the expertise of a Realtor. Whether you’re buying or selling, or moving locally or across the country, Realtors have the knowledge and tools needed to make sure you get the most out of your investment. That’s Who We R.
Founded in 1912, Greater Chattanooga Realtors is the voice for real estate in Greater Chattanooga. A regional organization with more than 2,700 members, Greater Chattanooga Realtors serves Hamilton and Sequatchie counties in southeast Tennessee and Catoosa, Dade and Walker counties in northwest Georgia. The association is one of approximately 1,100 local associations and boards of Realtors nationwide that comprise the National Association of Realtors. Greater Chattanooga Realtors owns and operates a Multiple Listing Service that is one of approximately 600 MLSs in the country and services more than 3,000 MLS users. Local association membership consists of Realtors servicing the Greater Chattanooga area and specializing in a variety of disciplines, including appraisal, commercial, industrial, land, multifamily, property management and residential. Affiliate members who represent related industries work alongside these Realtors, including mortgage lenders, home inspectors, title and closing services, pest inspection and control services and insurance providers.