Real Estate Market Trends - February 2022

— 3 minute read

I read an interesting article from the National Association of Realtors earlier today, so I wanted to share my thoughts with you. I also wanted to share how the market here in Chattanooga did for February compared to February of last year.

Every month the NAR releases data about how the housing market did nationwide the previous month. I enjoy reading this to see how things are going, but also because they talk about what they think is going to happen.

Nationwide Trends: Homes listed received approximately 5 offers

In February, a home listed received approximately 5 offers on it. Also, roughly half of buyers are still offering over asking price (around 2.9% over asking price) which based on the median home price comes to about $10,000 extra.

That's something to consider if you're thinking of buying. You'll need to make sure you have your earnest money, down payment, closing costs, and any money for inspections. If you're thinking of offering over asking price then I'd recommend either looking at homes around $10K less than what you're approved for, or having the cash to pay the difference.

Buyers offered on 3 homes before their offer was accepted

Another thing for buyers to consider, is that buyers typically offer on 3 homes before their offer is accepted. All hope is not lost though, because about a quarter of buyers get their first offer accepted.

I mention this because I know how heartbreaking it can be to put an offer on a dream home and have it rejected. Buying a home is an exciting and emotional time, and I hope that by sharing information, it might ease the sting a little.

Average days on market was 18

For those of you thinking of selling your home, most homes are on the market less than a month. The average amount of time a home stayed on the market last month was 18 days. I know here in Chattanooga, it's unsurprising for homes to be pending within a couple days of being listed.

Mortgage Rates are expected to hit 6%

Now the part that has me concerned. Because mortgage rates are rising, the NAR predicts competition for homes will increase this year. If the rates get to 6% like it's scheduled to, first-time buyers making less than $80,000 will be priced out of the market. If rates get to 4.5%, about 1.4 million renters will not be able to afford a home.

I remember how hard it was for my husband and I to buy a home around 6 years ago. We couldn't afford much and anything in our price range either needed major renovations, or we lost out to investors who offered all cash.

I would love to see new neighborhoods pop up, with smaller, affordable homes. Well built houses, that maximized space, but topped out at 1,500 sq ft might do really well in the near future.

Chattanooga Market Trends: Still a Seller's Market

As for the Chattanooga market for February, listings are up over last February, even though inventory is still relatively low. Pending sales, closed sales, and average sales price are also up. Days on the market has dropped by almost half of what it was this time last year. This is a great time if you're looking to sell your home.

So, that's all I have for you today. Contact me if you have any questions! I'll answer them to the best of my ability. I'd also love to hear any comments you may have. Thanks for reading!