August 30, 2017

New accepted home sale contracts continue at record pace

New pending home sales were flat in July while the total number of accepted contracts that have not closed increased by 90. While the market is seeing some expected seasonal slowing pending sales, continue at a record pace.

According to the Northeast Tennessee Association of Realtors' (NETAR) Pending Sales Report and data from Realtor Property Resource, there were 785 new contracts on single-family resales accepted in July, compared to 786 in June. Added to offers that have not closed it brought the July total to 1,100, up 90 from June. Pending sales typically move to closing in a month to six weeks, and it's normal for up to 4% of them to fall through.

"We've seen the number of single-family, townhome, and condominium with accepted offers increase at the rate of 700 plus a month since March," said NETAR President Eric Kistner.

The active, pending sales inventory, is now at a 13-month high - 21% higher than it was last year, he added. "The rate those offers have moved to closing has slowed in the past couple months due to several factors." Some of those factors include more contingency offers, appraisal delays and the sheer number of deals in the pipeline. And then there are the new regulations that have slowed down what used to be the normal process, he added.

Year-to-date data show new pending sales are 10.2% higher than the first seven months of last year while to total active pending sales count is up 7.3%.

"When you compare that to the new listing trend you quickly see that the sales pace continues to exceed the number of new listings coming onto the market, and that has driven prices higher," Kistner said.

During the first seven months of this year, the average listing price has increased from $218,606 last year to $238,638, up 9.2%. The median listing price – the point where half of the listings are higher, and half are lower – has increased to $166,771 from $155,995 – up 6.9%.

In July, the 11-county region monitored by the NETAR Trends Report has 4.3 months of inventory. Six months is typically used to describe normal housing market conditions.

NETAR's August Trends Report will be available in two weeks.