Why Are Home Sales Leveling Off?
For many months the Chattanooga real estate market and the national real estate market have seen the number of home sales be up each month. During the past few month, those rises in home sales are not as large and less homes have sold some months than the same month in the previous year. Lawrence Yun, National Association of Realtors (NAR) Chief Economist, spoke at the Chattanooga Convention Center this week and addressed this trend. He said that pending home sale (properties that are under contract and due to close) have leveled off for the most part. That leveling off is due to several factors.
1) Low inventory. There is a low inventory of homes for sale to choose from right now in Chattanooga and across the country. Fewer homes for sale means fewer homes selling.
2) Weakening affordability. Home prices keep going up because of the high demand and the lack of supply. Some home buyers simply keep getting beat to the punch when they find a home or outbid on a home. You have to make aggressive offers in today's real estate market. Some home buyers simply can not afford what they want to buy.
3) Low 1st Time Buyer Rate. Many 1st time home buyers have been forced to rent for more time in order to save money for a down payment on a home. Their purchases are being delayed at the moment, but they will buy in the future. Most people surveyed, want to buy in the future.
4) Diminished Optimism for home buying. People renting homes want to buy homes (other than older/career tenants). The problem is affordability. The Gallup poll, Fannie Mae poll, NAR Consumers poll, and the NAR Realtors poll all expect to see home prices continue to rise. Confidence in the investment of real estate is still high. The diminished optimism is in finding a home that fits a home buyer's budget.
If you are thinking about buying a home right now, do not get discouraged. There are still homes available to buy. The one thing you can not do in today's real estate market is try to use "flea market bargaining" when buying a home. Today, you have to make acceptable offers in order to get a home for the best price and in order to not get in a bidding war. Call Nathan Walldorf to buy or sell a home in today's Chattanooga real estate market. Chattanooga Realtor, Nathan Walldorf would be happy to help. 423-544-7700.