Tennessee Realtors Look Forward To Tackling Housing Challenges In 2014

Thursday, January 30, 2014

After several years of slow recovery, the U.S. housing market began to show signs of improvement in 2013. Some homeowners saw their home equity grow as home prices rose and single-family home sales increased. However, the market still has its challenges and realtors remain committed to helping build a responsible, sustainable housing market in 2014.

According to National Association of Realtors Chief Economist Lawrence Yun, 2013 was a recovery year, as annual existing-home sales are expected to increase 10 percent over a year ago, totaling just above 5.1 million, and national median existing-home prices are projected to be 11 percent above last year. The 2013 market also experienced a shortage of housing inventory. NAR data showed inventory levels swung from a record high of 11.9 months in July 2010 to a recent low of 4.3 months in January 2013. Recently however, inventories have started to increase—current unsold inventory shows a 5.1-month supply of homes.

“Tight inventory typically means rising home prices,” said Neal Clayton, 2014 president of the Tennessee Association of Realtors (TAR). “This is what we’re experiencing now. Prices have gained 11.5 percent nationwide over the past year, and 5.3 percent in Tennessee, according to the most recent CoreLogic report. An increase in prices has helped lift many homeowners into positive equity again, and foreclosures and short sales have declined. When homeowners benefit from price appreciation and housing equity increases, this helps the economy through greater consumer confidence and spending.”

Despite these positives, housing affordability for some buyers declined in 2013. Mr. Yun predicts affordability will continue to decline in 2014 if mortgage rates continue to rise and particularly if qualifying for a mortgage remains difficult. Tight credit restrictions are preventing some qualified buyers from becoming homeowners and making it more difficult for some homeowners to sell their homes. TAR thinks mortgage availability will only be worsened by regulatory reforms stemming from the Dodd-Frank Act Wall Street Reform and Consumer Protection Act that have gone into effect in January 2014.

“While these new rules reduce risky loan products and establish critical lending protections for consumers, they could also preclude many potential home buyers from entering the housing market,” Mr. Clayton said. “Qualified buyers with good jobs and strong credit histories cannot continue to be turned down for loans. Lenders need to return to sensible lending standards this year.” 

Mr. Yun predicts we’ll continue to see healthy gains in existing-home sales this year, and prices will continue to rise. However, he also projects mortgage rates to rise and inventory shortages to continue.  

Realtors will remain actively involved with lawmakers to ensure housing and homeownership issues are first on the nation’s public policy agenda this year. Several critical issues affecting housing will continue to take precedence this year—such as delaying further flood-insurance rate increases. Also, as debates surrounding federal tax reform likely heat up again this year, realtors will continue to urge the preservation of property and homeownership tax policies.

Realtors also support legislation and regulations to create healthier housing and mortgage markets, something Mr. Clayton says is vital to the recovery.

“Despite the challenges we face in the coming year, I believe realtors are feeling confident and optimistic about the future of the U.S. housing market, and especially the market in Tennessee,” he said. “Homeownership is an investment in our future, and I believe 2014 will present tremendous opportunities for buyers, sellers and investors.”


Real Estate Transfers For July 17-23

NOTICE: The Hamilton County Register’s Office did not publish this data. All information in the Register’s Office is public information as set out in T.C.A. 10-7-503. For questions regarding this report, please call Chattanoogan.com at 423 266-2325. GI numbers, listed when street addresses are not available, refer to the location of transactions (book number and page number) ... (click for more)

Realtors See Some Positives In June Sales Figures

Officials of the Chattanooga Association of Realtors said they see some positives in June sales figures. Officials said, "Upon first review of our June residential market statistics, housing seemed to have had a slow start in the spring selling season. But don’t let appearances deceive. As you dig into that spring soil, you begin to unearth differences in individual areas and ... (click for more)

City Council Presents Potential Ordinance To Address Noise Level Downtown

Members of the Chattanooga City Council presented a potential ordinance to address concerns about the noise level downtown. If passed, the ordinance will put limits to both dB(A) and dB(C) levels of sound. It was noted, "When we compare our dB level, it is clear that Chattanooga is lower than Nashville and Knoxville." However, this comparison only takes dB(A) levels into consideration. ... (click for more)

Harr Outlines $40 Million Plan For Chattanooga Light Rail System

Outgoing Chamber of Commerce President Ron Harr on Monday outlined a $40 million plan for a Chattanooga light rail system that would serve not only downtown, but also the Airport and the Enterprise South Industrial Park. In a speech to the Chattanooga Engineers Club, Mr. Harr said most cities looking at such an ambitious plan "would be facing costs of over a billion dollars." ... (click for more)

Senator Bob Corker: An Open Letter To Tennesseans

We are incredibly fortunate to live in a state in which companies worldwide are clamoring to establish a presence. Many attribute it to our pro-business culture, well-prepared workforce, low tax environment, right-to-work policies, and engaged citizenry.  That is why the announcement by Volkswagen to build its midsize sports utility vehicle and establish the South’s ... (click for more)

Roy Exum: Wamp Refuses To Stoop

With less than two weeks before the Aug. 7 th election and the last week of early voting now underway in Hamilton County, Congressional challenger Weston Wamp sounded upbeat and relaxed early yesterday afternoon. “I’m pleased to say that I believe we are right where we need to be … maybe even more than we had hoped.” Wamp, who is challenging two-term incumbent Chuck Fleishmann ... (click for more)