After two years of record-setting activity, there are emerging signs that the national housing market might be cooling. High home prices and a surge in mortgage interest rates are slowing buyer activity, with home sales declining for the third consecutive month under the weight of soaring homeownership costs.
The National Association of Realtors reports existing home sales were down 2.4% from the previous month, while pending sales fell 3.9% as of last measure, extending the trend of recent months. Economists predict sales will continue to soften in the near future, which may put downward pressure on home prices.
Across the country, the slowdown in sales has provided a much-needed lift to housing supply, with inventory increasing 10.8% from the previous month, the NAR reports, although supply remains down 10.4% compared to this time last year with only 2.2 months’ supply of homes at the current sales pace.
As the nation continues to explore ways to solve the ongoing housing shortage, estimated at 5.5 million homes, the White House recently unveiled the Housing Supply Action Plan, which aims to expand housing access through a number of administrative and legislative actions and help relieve the nation’s housing crisis over the next five years.
Locally, a somewhat different picture has emerged for May with inventory and sales increasing. When looking at the local market, new listings in the Chattanooga region increased 9.5% to 1,415. Pending sales were increased 4.5% to 1,162.
Inventory levels grew 4.7% to 1,232 units, and prices continued to gain traction. The median sales price increased 21.2% to $315,000.
In April, the median sales price was $302,500. Days on Market was down 36.4% to 14 days, the same as April. Absorption rates were even with last year as months supply of inventory remained flat at 1.1 months.
The housing market continues to shift wildly, which is why it is so 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 are getting the most out of your investment. That’s Who We R®.
Founded in 1912, Greater Chattanooga REALTORS® is a regional organization with more than 2,500 members servicing 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/board of REALTORS® nationwide that comprise the National Association of REALTORS®. Greater Chattanooga REALTORS® owns and operates a Multiple Listing Service (MLS), which is one of approximately 600 MLSs in the country and services more than 2,700 MLS users.