There are signs the local housing market is slowly transitioning to more normal conditions. Demand is ebbing, and inventory is gradually increasing. But that didn’t pull August prices and closings off a record-setting pace.
Prices were at all-time highs. And closings were at an 11-month high.
“Some of the sizzle is coming off the market, but it still a very hot,” Kristi Bailey, President of the Northeast Tennessee Association of Realtors (NETAR), said. “Mortgage rates have stayed in the basement, and even a slight inventory increase is giving buyers more choices.”
August’s average sales price was $257,137. That’s up 21.99 percent from August last year. Bailey said the average was skewed by a surge of sales in the $300,000 to $400,000 price range and a 126 percent increase in the $500,000 and up price range.
The median sales price — the middle of the market — was $210,000, up 16.7 percent from last year. Sales in that price range accounted for 14.7 percent of August’s total sales, and new listings increased by 17 percent.
There were 935 closings in August, up 7.5 percent from last year and 16 sales short of the all-time record set in September last year.
Signs that market conditions are moderating include:
A home’s time on the market before closing has inched up from 47 days in May to 49 days in August. The longer homes stay on the market is a primary demand indicator. If it increases, it points to softer demand. If it declines, demand is rising.
New listings have outnumbered new contract acceptances for the past three months. It points to a slow but steady increase in active inventory.
Since May, inventory has increased from a 1.3-month supply of homes for sale to a 1.6-month supply in August.