march 2023 NEWSLETTER
Steven Sharpe: How Much Has Chattanooga Real Estate Changed In 10 Years?
- Thursday, March 2, 2023 / Steve Sharpe, President, Greater Chattanooga Realtors
- I’m a data guy. I love numbers, and the more information I have, the better. In real estate, more data can mean a better look at long-term trends which can help lead to more informed decisions. I’ve noticed that I often look at monthly housing data compared to the data from a year or two ago. But what if we looked at what the data says about housing over a longer period? Taking a 10-year view of the real estate market in our area can provide valuable insights. Not only can it show us how the market has changed over time, but it also highlights how real estate is impacted by external factors such as economic growth and recessions and how it could potentially change in the future.
With that in mind, let’s take a deep dive and see what we can learn.
We’ve posted this data on our website at https://www.gcar.net/ten-year-retrospective. Here are some key takeaways:
The number of available homes at the end of each year has dropped consistently but rose significantly in 2022. At the end of 2012, there were just over 4,500 properties available. Because of the shifting housing market, this number reached an all-time low at the end of 2021, which showed only 900 homes available. However, this number increased at the end of 2022, with nearly 1,800 properties available. These numbers show reduced housing inventory and increased home sales, which is also noteworthy.
The number of homes sold each year has increased steadily since 2012 and reached a high in 2021 before dropping slightly in 2022. Low interest rates and a strong economy have certainly impacted home sales in the past decade. More properties have sold over the years and are being sold faster (more on that later). In 2012, 6,663 properties were sold for the year. This amount peaked in 2021 with almost 13,000 sold. In 2022 this dropped slightly to just over 11,500. This decrease is most likely due to a dramatic increase in mortgage rates.
The average time it takes for a property to be under contract has dropped significantly since 2012. Consider anyone you know that sold a house in the past few years. They may share stories about multiple offers, people making offers sight unseen, and properties being sold mere hours after hitting the market. But this hasn’t always been the case. In fact, the average Days on Market was a whopping 129 days back in 2012. This timeframe dropped steadily over the last few years, reaching a low of just 20 days on average in 2022. In short, homes have been selling fast! All these factors have combined to cause a dramatic increase in home prices in the past 10 years.
The median home sales price in our area has dramatically increased over the past 10 years. In 2012, the median sales price was $137,000, while in 2022, it had risen to $305,000 - a jump of 122 percent. Again, an increase in demand for housing, low interest rates, and a booming economy are all contributing factors. Depending on your perspective, this increase can be both a blessing and a curse. On the one hand, it is excellent news for those who already own a home, as their asset has most likely grown in value. On the other hand, this increase in home prices has made it increasingly difficult for first-time homebuyers to enter the market. We need to find a solution to this problem, as it affects many people and can have long-term implications for the housing market.
The housing market in our area has certainly changed in a decade, but the main point to take from this data is that homeownership has been, and looks to remain, an excellent way to build personal wealth. Have questions about what’s involved with entering the market? Consult a realtor. A realtor will work with you to understand your housing needs and can help advise you on what path might be best for you.
Realtors are the professionals you want to turn to when buying or selling a home. We have access to a wealth of knowledge and resources that most real estate agents may not have. Realtors are held to a higher standard of conduct and ethics than real estate agents and must abide by a strict code of ethics and standards of practice. We have access to the multiple listing services (MLS) which gives access to a wide range of property listings, allowing us to better serve clients. Realtors are also well-versed in local market conditions, which can be invaluable in helping you make informed decisions. Realtors provide valuable assistance in the paperwork and negotiations that need to take place during a real estate transaction. Realtors work for their clients and community to help people achieve homeownership. That’s Who We R.
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