When talking about the real estate market, the media and the public finally have shifted from using words such as "slow" and "sluggish" to "multiple offers" and "recovery."
With prices going up, there are some who wonder if a new bubble is forming. The reason behind this speculation is that most metropolitan markets are somewhere between recovery and normalization.
Locally, our housing supply remains tight but is improving. What housing really needs is further job and wage growth to support healthy demand levels fueled by new household formations.
Nationally, April’s job growth was above expectations. Growth is likely to accelerate through the year, but the types of jobs being created is also important. We’re producing more low-wage jobs as opposed to high-wage jobs. That’s not conducive to increasing the number of potential buyers. It also means less disposable income sloshing around. Even so, some local markets may pause but are unlikely to falter thanks to suppressed supply levels and an improving sales mix. Don’t confuse temporarily weak demand indicators for stagnation.
The April residential statistics from the Association's multiple listing service shows a slight slow down in the local real estate recovery. New Listings in the region decreased 5.2 percent to 1,121 units. Pending Sales were down 43.2 percent to 400. Inventory levels shrank 3.3 percent to 4,990 units.
Days on Market was up 2.4 percent to 129 days. Absorption rates slowed as Months Supply of Inventory was up 2.3 percent to 8.9 months.
Despite the above-referenced numbers, prices in the Greater Chattanooga region remained determined. The Median Sales Price increased 11.4 percent to $149,900. The Average Sales Price increased 10.8 percent to $181, 531. And in looking at year-to-date data, we have an 8.6 percent increase in Average Sales Price to $172,881.
In addition to increases in local prices and market activity, I am encouraged by participation in this past weekend's Greater Chattanooga Open House Weekend. Nearly 300 open houses were held throughout our region. This high level of participation by consumers and Realtors demonstrates the enthusiasm and momentum in our local market. Spring typically is known as the "buying season" and by all indications that fact will prove to be true again for Greater Chattanooga home buyers and sellers.
The Greater Chattanooga Association of Realtors, a regional organization with more than 1,400 members, is one of more than 1,800 local boards and associations of Realtors nationwide that comprise the National Association of Realtors. The Greater Chattanooga Association of Realtors services Hamilton and Sequatchie counties in southeast Tennessee and Catoosa, Dade and Walker counties in northwest Georgia. For more information, visit www.gcar.net.