Pending home sales decline for fifth month
Pending home sales declined for the fifth straight month in September. Sellers accepted 752 new contracts, down 116 from August and 115 fewer than September last year.
Pending sales are a leading indicator of housing activity based on signed contracts for existing single-family homes and condominium sales in the region monitored by the Northeast Tennessee Association of Realtors (NETAR). Since resales go under contract 30 to 60 days before they close, accepted contracts offer insight into home sales’ direction.
“The decline is a clear signal the home sales are in a seasonal pattern, and the sales market is cooling,” NETAR President Rick Chantry said. “Buyers are beginning to push back, and higher mortgage rates have given them a little more bargaining power. Some sellers are negotiating more before accepting a contract, and 303 reduced their asking price last month. We’re still in a sellers’ market, and given all the current indicators, will be that way for a while.”
At mid-month, the region had 1,350 properties on the market. At the end of September, the area had a 1.7-month inventory of homes on the market for sale. That’s the time it would take to sell everything on the market at the current sales pace. “Inventory has been inching higher for seven months,” Chantry said. “We have had less than two months of inventory for 22 months, and the last time we had balanced market conditions was the first quarter of 2018.”
The typical home sold in September was on the market for 47 days before it closed. That’s up two days from August and the seventh monthly increase this year. Time on the market is a demand indicator. When it increases, demand is softening. When it declines, demand is rising.
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 1,600+ members and 100+ business partners involved in all aspects of the residential and commercial real estate industries. Weekly market reports and information for both consumers and members are available on the NETAR website at https://netar.us