Today the Greater Nashville Association of Realtors released the February 2015 sales stats for middle Tennessee. Once again, sales are occurring at a much more rapid pace than the same time last year. With transactions totally 2,091, sales are up 12.6% percent from the same time in 2014. But the real story is the continuing lack of inventory.
Right now, at this very moment, inventory is basically nonexistent in several sections of the market:
“Inventory remains the main challenge in the market, though [hopefully] we will see it uptick as spring nears. The hardest hit market, in regard to inventory, is the first-time buyer range. The inventory supply there is very low. For example, the absorption rate for single-family homes below the January median price of $215,000 just in Davidson County is 2.2 months. Using the same criteria, the absorption rate above the median was 4.8 months. By the time you get to the $600,000 and above range, inventory is plenty at an 8.9 month supply.”
Absorption rate is the amount of time one would expect the entire inventory of market homes to be absorbed if no new listings came in their place. In a healthy market, you can expect to see about six months worth of inventory. A buyers market is anything over six months, and a sellers market is anything under six months. A 2.2 month supply of inventory is incredibly low. These are the numbers we just do not see in Middle Tennessee. It means that homes that are priced appropriately and show well typically sell within the first week they are on the market, occasionally for over list price, and often with multiple offers to choose from.
The challenge continues to be appraisals. Appraisers believe our market has rebounded too quickly. That the double-digit increases we have seen in the past 20 months are unhealthy and unsustainable. They are pushing back hard on escalating values trying to get our market in check.
That being said, if you have a property priced under, say, $300,000, Right now is the very best time to list it. If you wait until spring, there will be more competition and more choice for buyers. Right now, houses are flying off the market. If you are thinking of listing, right now – today – is the time to do it.
Curious about your property value? I have a quick online tool that can help. Of course, nothing can take the place of the keen eye of an experienced Realtor who is out in the field every day. Download our free sellers guide here.
