March usually signals the beginning of the home buying and selling season, and on a national level, existing home sales jumped 14.5% month-over-month in February, which was the first monthly gain in 12 months. This is the largest monthly increase since July 2020, according to the National Association of REALTORS® (NAR). The sudden uptick in sales activity stems from contracts signed toward the beginning of the year, when mortgage rates dipped to the low 6% range, which caused a surge in homebuyer activity. Pending sales have continued to improve heading into spring , increasing for the third consecutive month, according to NAR.
Monthly sales might have been even higher if not for limited inventory nationwide. At the current sales pace, there were just 2.6 months’ supply of existing homes at the beginning of March, far below the 4 – 6 months’ supply of a balanced market. Inventory remains suppressed in part because of mortgage interest rates, which nearly hit 7% before falling again in recent weeks. Higher rates have continued to put downward pressure on sales prices, and for the first time in more than a decade, national home prices were lower year-over-year, according to NAR, breaking a 131-month streak of annual price increases.
Taking a look locally, in March New Listings in the Chattanooga area decreased 12.8% to 1,170. However, the total available housing Inventory grew 42.6% over March 2022 (1,079) to 1,539 units. Pending Sales were down 7.3% to 1,031.
Prices continued to gain traction. The Median Sales Price increased 5.0% over March 2022 ($300,000) to $315,000. Days on Market was up 89.5% to 36 days. Buyers felt empowered as Months Supply of Inventory was up 70.0% to 1.7 months.
No matter the time of year, and no matter the market, utilizing the knowledge and expertise of a REALTOR® is key to helping navigate the complex process of buying or selling a property. Realtors® provide valuable insight into the local market, help negotiate offers, and ensure that all legal and financial requirements are met. Realtors® work for their clients and communities every day. That’s Who We R®.