Well, friends, it's time to take a peek under the hood and see what the housing market is up to. And... all I can say is that it's the same hot mess under the hood as it was last year. Interest rates are still hovering between 6-7%. It has become apparent that 6-7% interest rates will be the new normal, with 5-6% being the new good rates and above 7% indicates the market is heading into rougher waters.
If you take a gander at the stats in the graphic above, you will see, in my opinion, that we are approaching a balanced market. To my mind, this data would suggest that home prices should be softening. However, that is not occurring, at least not yet.
It seems like home prices in Chattanooga are being supported by good old-fashioned supply and demand forces. Housing numbers peaked out late last year at approximately 2,000 actively listed homes in the Chattanooga Area MLS. As of today, there are approximately 1,367 homes actively listed. This slide in housing supply and the uncertainty of the market have caused some potential sellers to be hesitant to list. Yet, the people just keep on moving here.
According to a recent article, for every one person that moves away from Chattanooga, three move in. If this continues, not withstanding economic catastrophe and/or the FED hammering down even further than their latest revised estimates, I don't foresee too much softening in home prices in Chattanooga.
With our median home prices still being significantly lower than the rest of the country, our increased popularity, the continued dissatisfaction by residents of other states, and people's increasing ability to work from anywhere...Well, that is what I like to call a silver lining when it comes to home price stability in Chattanooga. I can hear the cries of outrage about the increased, well, everything that comes from the influx of new residents. However, that influx is a key reason why you can still sell your home for a profit in Chattanooga.
So, is it still a good time to buy or sell a home? Despite the odds, in Chattanooga, it still is a good time to sell. As for buying a home, it's a different story. Financing in this market is a bit uncertain, and it's not wise to buy just because you want a larger garage or a more luxurious home unless you are putting a decent chunk down. Nevertheless, if you need to move because of work or have added a new family member and need more space... those types of "life change" moves are still happening every day.
Compared to the rest of the country, Chattanooga is a value, and our market is still healthy. Thank goodness!
Till next time,