Now that we’re halfway through 2016, we’ve witnessed residential real estate markets perform as predicted at the beginning of the year. Sales and prices have been going up in most areas, while the number of homes for sale and total months’ supply of inventory have been going down. Meanwhile, many sellers have been getting a higher percentage of their asking price, and supply continues to struggle to meet demand. Whether nationally or here in Greater Chattanooga, the message may be repetitive, but it is largely positive.
For June, New Listings in the Chattanooga region decreased 1.0 percent to 1,349. Despite the slight decrease, New Listings remain higher than the three-year average for this point in the Summer season.
Pending Sales were up 19.9 percent to 952. In recent months, we’ve seen Pending Sales the highest they’ve been in more than ten years. As Inventory levels continue to shrink – 19.8 percent to 3,703 units in June – home owners considering entering the market should take note. Months Supply of Inventory was down 28.1 percent to 4.6 months. Buyers are anxious for more options.
The last month’s closed transaction show that buyers are paying an average of 95 percent of List Price. Homes are being snapped up quickly. As a result, Days on Market for June was down 13.9 percent to 62 days.
Prices continued to gain traction and are the highest our market has seen in more than a decade. The Median Sales Price increased 11.0 percent to $172,000. The Average Sales Price increase 10.5 percent to $212,389.
Recently, the national unemployment rate dropped 0.3 percent to 4.7 percent, but some states, including Tennessee, felt more of a pinch. The Bureau of Labor reports Tennessee’s unemployment is down 1.7 percent, which equates to 13,400 job losses. However, things are not as dire as those numbers might indicate. It’s important to consider both job loss and new jobs to see where we actually stand.
Dr. William Fox, director of the University of Tennessee’s Center for Business and Economic Research, recently observed, “Tennessee’s economic growth, as measured by employment and sales tax collections, has really been extraordinary so far this year and continues to outpace the nation.” This positive perspective is due partially to nearly 61,000 new jobs created in Tennessee over the last 12 months.
The low inventory situation is showing signs of strain in markets where there are few homes for purchase. With an interest rate increase still in the cards this year, combined with the American political landscape and global economic events, a cool down could occur by winter. Presently, however, summery growth prevails as many locales, including the Chattanooga region, are reaching near-record prices not seen in more than a decade.
As I’ve been stressing all year, now is the time for property owners to jump off the fence and enter the housing market. Doing so could be a win-win for both hesitant sellers and anxious buyers. Contact a Realtor today.
The Greater Chattanooga Association of Realtors is “The Voice of Real Estate in Greater Chattanooga.” The Association is a regional organization with more than 1,700 members, and is one of more than 1,400 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.