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Pending sales point to a recovery from January’s lackluster market performance. And they’re not the only thing looking up in a market seeing softer demand. There was a pending sales surge in the affordable homes market, which also saw increases in active inventory and new listings.
Sellers OK’d 624 contracts last month. That’s 97 more (up 18.4%) from December. They’re 13.9% higher than last year and the three-month trend is up 16.2%.
Pending sales are a leading indicator of housing activity based on signed contracts for existing single-family homes and condominium sales in the region monitored by the Northeast Tennessee Association of Realtors (NETAR). Since resales go under contract 30 to 60 days before they close, pending sales offer insight into the market’s direction.
Activity in the $180K-$249,999K affordable housing price range dominated pending sales growth last month. They were up 34.4%. The strongest gain was with $180K-$199,999 sales, which were 71.8% higher than last year. The largest number of affordable pending sales was in the $200K-$249,999 price range.
Move-up market pending sales in the $250K-$499,999K price range increased 22.4%. The largest number – 115 – was in the $300K-$399,999 price range, while the largest year-over-year gain (47.2%) came in the $400-$499,999 price tier.
Luxury home pending sales were down 5.8%.
At month’s end, total active inventory was down from December, but up 22.6% from last year. It has been slowly increasing since June last year.
Affordable homes inventory was up 38.5% last month and second in the number of total listings to the move-up market mid-range of $300K-$399,999.
Total new listings made a small advance from December. The biggest gain was in the affordable homes. They were up 22%.
The typical home that sold last month was on the market for 63 days, up from 57 days in December and 59 days last year. The time on the market has been slowly increasing since September. When homes spend more time on the market, it signals softer demand; however, that lessening of demand has not significantly affected sales or prices.
Sellers reduced their original list price on 35% of the homes that sold last month. Of those that sold 41% saw a price reduction during negotiations. The average reduction was $20,000. The typical reduction was $9,900.
The median listing price last month was $299,999. The mid-month median sales price was $239,000.