As COVID-19’s impact spread across the country in March, the stock market decline that started in February accelerated downward before recovering a bit in the last week of the month. With volatility across all the financial markets, lenders began tightening underwriting standards, and some buyers found they no longer were approved for a loan. Massive layoffs also shook the national economy with 6.6 million initial jobless claims filed in a single week—double the number last week and ten times higher than any other week on record prior to this month.
Focusing on the local level and housing, in March prices continued to gain traction. The Median Sales Price increased 10.5 percent to $210,000. Yet, even with increased prices, our market doesn’t seem to be over-priced. The March Housing Affordability Index was to 142, meaning the median household income is 142% of what is necessary to qualify for the median-priced home under prevailing interest rates.
Days on Market was up 3.7 percent to 56 days. Sellers were encouraged as Months Supply of Inventory was down 27.3 percent to 2.4 months. New Listings in the Chattanooga region decreased 6.1 percent to 1,207. Pending Sales were down 4.5 percent to 976. Inventory levels shrank 20.5 percent to 2,182 units.
So how has the market changed because of COVID-19? As a point of reference, in March of 2019, New Listings in the Chattanooga were 1,282. Pending Sales were 1,084. The Median Sales Price was $190,000. Days on Market 54 days. As you can see, the current environment is affecting real estate, but real estate is still happening.
While the effect of COVID-19 is varied throughout the country, we are likely to see impacts on housing activity now and into the coming months. Its continued spread is leading many companies and consumers to change their daily activities.
Navigating a market that can shift quickly is just one reason why consulting a Realtor is so important. In addition to navigating COVID-19 (see www.gcar.net/covid-19), Greater Chattanooga Realtors is also assisting in gathering resources for those in our community whose homes and businesses were impacted by the recent tornadoes (see www.gcar.net/disaster-assistance). Realtors keep a watchful eye on trends locally and nationally that might affect our clients and community. That’s Who We R.