December 28, 2017

New pending sales softer in November, market moves toward strong 2017 close

November pending sales were down 9% from October but kept up their year-over-year double-digit increase pace for the third month.

There was a total of 869 approved contracts on single-family, condo and townhome sales in November, according to the Northeast Tennessee Association of Realtors (NETAR). Pending sales typically move to closing in 30 to 45 days, and it's not uncommon to see 4% to 5% fall through. This year the number of contracts that fall through are up slightly during to more contingencies.

New listings were also down from October as expected this time of the year, but the year-to-date trend is slightly higher than it was during the first 11 months of last year, NETAR President Eric Kistner said. There is also more competition from new buyers coming into the market who continue to find their options are limited, he added. At the end of November, the 11-county region monitored by NETAR had 4.6 months of inventory. This time last year there was a six-month supply of home for sales on the market.

Stronger economic reports and expectations that more millennials will push to become first-time buyers next year are straining inventory and pushing average prices higher. The average sales price as a percentage of the average listing price was 96% in November, up a point from October.

December's Northeast Tennessee, Southwest Virginia closings and the annual sales report will be released in a couple of weeks. At the end of November, sales have already exceeded last year total, and the average sales price was 4.7% higher than the first 11 months of 2016.