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Front Page - Friday, January 25, 2019

More inventory could ease home prices in 2019

Home prices were consistently up again in most markets in 2018 but at reduced levels compared with recent years. High demand for fewer homes for sale fueled price increases, but evidence is mounting that inventory will finally improve in 2019. This might apply some downward pressure on prices for beleaguered home buyers.

A fourth interest rate hike by the Federal Reserve in 2018 spooked the stock market to close out the year. The Fed has indicated that the number of rate increases in 2019 will be halved, which might be of little comfort to an already compressed consumer.

New Listings in the Chattanooga region increased 4.2 percent to 689. Pending Sales were up 2 percent to 625. Inventory levels shrank 4.5 percent to 2,615 units.

Prices continued to gain traction. The Median Sales Price increased 8.9 percent to $195,000.

Days on Market was down 16.9 percent to 49 days. Sellers were encouraged as Months Supply of Inventory was down 6.1 percent to 3.1 months.

Unemployment rates remained remarkably low again in 2018, and wages continued to improve for many U.S. households. It’s generally good for all parties involved in real estate transactions when wages grow, but the percentage of increase, on average, has not kept pace with home price increases.

This created an affordability crux in the second half of 2018. Housing affordability will remain an important storyline in 2019.

Greater Chattanooga Realtors is “The voice for real estate in Greater Chattanooga.” A regional organization with more than 2,000 members, Greater Chattanooga Realtors is one of some 1,300 local boards and associations of Realtors nationwide that comprise the National Association of Realtors. Greater Chattanooga Realtors services Hamilton and Sequatchie counties in southeast Tennessee, and Catoosa, Dade and Walker counties in northwest Georgia.

More information at www.gcar.net or 423 698-8001.