During the month of the 30th Olympiad, housing medaled in several arenas. A few short years ago, housing was considered a headwind to economic recovery. Today, housing is seen as a tailwind to a stalling economy. For the first time since 2005, housing is on track for contributing positively to national GDP in 2012. That can occur either by way of direct residential investment or through remodeling and other ancillary services. Watch for signs of sustained tailwinds in a variety of indicators, including market times, seller concessions, prices and absorption rates.
The month of July saw the sale of 618 Residential Units, a 16.2% increase from the previous year. New Listings in the Chattanooga region increased 11.8 percent to 1,015. Pending Sales were down 13.0 percent to 470. Inventory levels shrank 14.8 percent to 4,983 units.
Prices were fairly stable. The Median Sales Price decreased 1.4 percent to $141,500. Days on Market were down 3.8 percent to 126 days. Absorption rates improved as Months Supply of Inventory was down 23.0 percent to 9.7 months.
GCAR President Mark Hite concluded, “Sustained recovery will not occur without real employment and wage growth. Consumers must be confident in both the economy and their family finances before signing on the dotted line.” Mr. Hite continued, “Cheap borrowing costs have served as the glue binding things together. Unimaginable a few years ago, the rate on a 30- year fixed mortgage recently ducked below the 3.49 percent marker. Job creation and GDP numbers will garner particular attention this quarter.”