It looks like a fiercely competitive prime season
Real estate professionals are buckled up for what looks to be a fiercely competitive prime home buying and selling season, based on what they saw in the Northeast Tennessee Association of REALTORS® (NETAR) January Home Sales Report. In many ways, the market’s fundamentals have not changed that much, but demand is higher. It is higher because the record low inventory continues pushing prices higher and homes are selling quicker than last year.
There was a slight softening of the January market when compared to December. Homes sold a little slower than December, and sellers were held back on new listings. That drove an already record-low inventory even lower. January’s sales and price increases were in the double-digit range. This red-hot market is a lot like the Energizer Bunny commercial on TV. It just keeps on going and going.
The number of homes for sale is at an all-time low. At the end of January, there were 1,286 active listings – fewer listings than the number of REALTORS®-members at NETAR. Despite last month’s 13.5% increase in sales, new listings from January were down 18 homes.
A typical existing home sale that closed in January was on the market for 68 days, compared to 86 days in January last year. That and basement-level mortgage rates continued driving listing and selling prices higher. A comparison of average and median sales price growth rates for the past two months could signal more stable price growth. There was less than a percent difference in both months. It is also noteworthy the median was slightly higher than the average in January.
Here is how Bankrate.com explains why the median price is given more weight than the average. “The median price is a better indication than the average price of a property’s value and local real estate market. Real estate professionals refer to the median price rather than the average price because it is less affected by outliers or properties that skew the perceived values in a particular housing market. A house that sells for far more or less than most houses in the area will skew an average price.”
And finally, if the 2020 end-of-the-year state of the market conditions is any insight into what to expect, look for continued stiff sales competition, especially in the Blountville, Unicoi, Gray, Elizabethton, and Kingsport. Price appreciation ended the year in the double-digit range in all but two local markets. More year-end information can be found on the NETAR Web site at https://netar.us/state-of-the-2021-ne-tenn-sw-va-housing-market/
Buyers should double-down on the advice to be prepared to act quickly. Be ready to play the long game. Do not get caught up in the buzz. Do not get discouraged. There are good deals out there. They just may not come at the same pace as sales.
NETAR is the voice for real estate in Northeast Tennessee. It is the largest trade association in the Northeast Tennessee – Southwest Virginia region representing over 1,400 members and 100 affiliates involved in all aspects of the residential and commercial real estate industries. Pending sales, Trends Reports, and the regional market analytics can be found on the NETAR websites at https://netar.us/voice-real-estate-northeast-tennessee.