By Vicki Trapp, AHWD, ASP, CRS, GRI, SRES, SRS, President
Greater Chattanooga Association of REALTORS®
It’s tempting to confuse market normalization with a possible slowdown. But those equipped with high-quality MLS data know better. As mortgage delinquencies fade, banks are listing bargain-priced product less often. That means investor activity – which accounts for a substantial market share – is moderating. That’s not to say that rates and prices aren’t still attractive to owner-occupant buyers. They most certainly are. Some short-term volatility is expected as part of a normal market readjustment.
Within the last month, New Listings in the Greater Chattanooga area decreased 2.0 percent to 934. This figure is slightly less than the year-to-date comparison, which dropped 2.6 percent. Pending Sales also were down for the month by 38.0 percent or 346 Pending Sales.
Despite a lower than ideal inventory of new listings, throughout February prices remained determined. We saw the Median Sales Price increase 17.6 percent to $143,500. And the Average Sales Prices improved, increasing 8.5 percent to $175,023. Another positive is that it is increasingly more common for sellers to get their asking price. Our data shows that we are up 1.4 percent in this regard, with 91.7 percent of buyers paying the sellers’ original asking price.
Days on Market was up 7.0 percent to 137 days. Absorption rates improved as Months Supply of Inventory was down 4.7 percent to 8.2 months. Inventory continues to be a concern and shrank again this month by 5.3 percent to 4,681 units. A lack of inventory it not specific to our market, and is reflected in the national numbers, too.
The economy has more or less shuffled along, despite some climate-induced surprises to job growth and new construction. There is no denying the fact that we’ve now seen 47 straight months of private job growth, creating 8.5 million new payrolls. In February alone, nationally we saw 175,000 new jobs. More jobs bring more homebuyers and other home related boosts to the economy.
While job growth is a huge positive, there’s still work to be done. Thankfully, with such low inventory levels, many builders are bullish on new construction. Nationally, 152,000 construction related jobs were created last year. While we would like to see that number even higher, it is a step in the right direction. The spring market is budding, and it should be an interesting one.