The Chattanooga area economy received some welcome news from the real estate market last month according to data released by the Multiple Listing Service of the Greater Chattanooga Association of Realtors. In December of 2011, Southeast Tennessee and the Northwest Georgia area saw the sale of 458 residential units, a robust 15.1% increase compared to the previous month’s sales, and a very solid rise of 3.4% from the same month of 2010.
In good news for homeowners and sellers, the local median home price showed a welcomed increase from November of 5.8% to $132,250, but a drop of $4,750 (3.5%) from December of 2011 – still indicating a positive market for buyers in an area of this size.
Among the other encouraging developments, GCAR also reported that the average days on the market decreased by nine full days from November, as well as 10 days from December 2010.
Mark Hite, president of the Realtors Association, said, “Mortgage interest rates are a major factor in calculating affordability. Interest rates have hovered around 4% for months for both conventional and FHA loans. These rates are in comparison to 2008 when the average interest rate for the year was 6.15% according to NAR.”
He added, “When you combine these two factors into a monthly payment which is measured as a percent of the Median family income, one can derive the Housing Affordability Index. This index has been improving since the current housing downturn began in 2007 nationally.”
Russ Elliot, president of the Chattanooga Area MLS said, “I’ve often said that it doesn’t take a genius to see that declining prices and falling costs to borrow money increase the affordability. A person can simply get more house for the money than they could three years ago and the cost to borrow the money is lower than three years ago as well. Now is the best time to buy a home or invest in real estate in over 40 years!”