After bottoming out in 2010, the Chattanooga housing market is now on the upswing. Four telling indicators of the real estate market are home values, days on market, months’ supply, and number of homes sold. Each of these indicators point to a surging market.
Average home values in Chattanooga are 10 percent greater than they were at their worst in 2010 and almost identical to their levels in 2006. Some hyperlocal markets have even grown to greater than pre-recession levels, such as North Chattanooga, whose average home value is 20 percent greater than its pre-recession peak in 2006.
Days on market is the time frame beginning when a house is listed up until the day it is sold at closing. While the average days on market, currently 132, is slowly descending from its crest at 136, 2013 is the first year since 2010 in which the listing to sales price ratio, the difference between a home’s current listing price and the accepted sales price, rose from 95 percent to 96 percent, indicating an impending shift from a buyer’s market to a seller’s market.
Months supply is a statistic used to determine how many active listings are currently available and how fast they will sell. Anything below a 6 month supply is considered to be a seller’s market by the National Association of Realtors. During the high summer season, the months’ supply dropped to 7.18 as compared to 12.78 in May of 2009 and from an all time high of 20.5 in January of 2009.
The number of homes sold saw a significant rise from 2011 to 2012, a 17 percent increase, and this year’s numbers are likely to exceed 2012. However, the number of homes sold in 2012 is 30 percent less than in 2006 and it is not likely for 2013 to get much closer. It is not clear if this is an indicator that the market has plenty of room to grow or if it is has stabilized at a healthier level.
Examined from all angles, the Chattanooga housing market has made a robust recovery and is poised for an energetic 2014, which will likely trend further towards a seller’s market.
(About Jim and Monique’s Team: Since 2005, Jim and Monique’s Team at Keller Williams has excelled in providing strong customer service, integrity in business, masterful knowledge of the local market, and competitive negotiations. So far this year, they have helped both buyers and sellers to close on more than 130 homes. For more information on the state of the Chattanooga housing market contact Jim Lea at 423-664-1610 or email jim@historicchatt.com.)