Based on current market conditions, RE/MAX of Tennessee's top brokers have named the top Chattanooga housing trends to watch in 2014.
1. Home inventory will remain tight. RE/MAX brokers anticipate that the inventory of homes for sale in Chattanooga
will remain lower than the demand for homes. Many homeowners have recouped some equity in their homes, which puts them in a more favorable position to consider selling.
It is unlikely, however, that the market will see a large shift in available inventory. Overall sales should go up, but in 2014, it will likely remain a seller’s market.
2. Housing market will remain competitive. Some buyers who began looking for a home in 2013 have still not purchased. These leftover buyers, together with buyers who are just beginning to search in 2014, will keep the competition brisk for existing home sales.
3. New Qualified Mortgage rules take effect, limiting loan options for many buyers. New government rules took effect on January 10, 2014, intent to revamp the mortgage industry. From this point forward, new mortgages must only be 30 years or less, a fixed-rate or an adjustable rate. Borrowers must also pass a point/fee test in order to qualify, resulting in more stringent lending.
4. Boomerang buyers will enter the market. Recent revisions to Federal Housing Administration guidelines will make it possible for homeowners who lost their home to foreclosure to reenter the housing market as buyers. In some cases, the traditional seven-year waiting period has been revised to just one year. RE/MAX of Tennessee brokers expect that this new market of homebuyers will begin to emerge this year and continue for the next several years.
5. Home prices will continue to rise. The average price for all homes sold in the Chattanooga area was $138,500 in December 2013, a 3% increase over November 2013. In Chattanooga, the average number of days on the market for all homes sold in December 2013 increased by 2% compared to December 2012. As Chattanooga’s economy continues to recover, RE/MAX brokers expect that home prices will continue to rise.
“The housing market in Chattanooga showed marked improvement in 2013,” said Senior Vice President of Broker and Agent Development Jeanette Schneider. “We are quite optimistic about 2014 and we expect this upward trend to continue. Our real estate professionals are ready to work with Chattanooga residents to help them achieve their real estate goals in 2014 so that the numbers continue to improve.”