Nashville came this close to a record
March was another strong month in Nashville and came just short of setting a record for the month. If there was more inventory, I expect we would have easily sold 97 more units to put us over the top.
3,420 homes were sold last month, which is the most for March since 2006 and is 8.9% higher than the sales we experienced in 2016. Every sale category that we follow (residential, condominium, multi-family and land) beat last March’s numbers. Year to Date we are 9.7% ahead of 2016 on sales volume.
Inventory continues to dwindle as the volume grows. The total inventory is down 10.4% over the same month last year. This equates to 1,241 fewer homes on the market today. Buyers are really starting to feel the pinch and anxiety of losing out on so many homes.
The average price in Nashville jumped to $273,500 for March. This is 11.6% higher than the $245,000 reported in March of 2016. And the average time on the market is now 50 days.
“Mortgage interest rates have risen slightly in the past month, which can nudge potential buyers to act more quickly,” said Greater Nashville REALTORS® President Scott Troxel. “Interest rates are very important for homebuyers and they get that. The rate can begin to impact whether a buyer can qualify for the home they want. Locking in at the lowest interest rate is a motivating factor for many buyers.”
While rising rates and prices can nudge buyers to get into the market, at some point they have negative repercussions. In my conversation last fall with Jonathan Smoke, the Chief Economist for realtor.com, a slow down in the market is expected when rates go over 5% for a 30-year fixed mortgage.
The current rate is hovering around 4% and is expected to increase as the economy improves. With each 1% rise in interest rates, a borrower losses about 11% in purchasing power.
Lots of people who want to make a move this year are worried about the market. If this sounds like you, hit reply and let me know your biggest concern. We’ve developed effective strategies for success in these conditions and would love to share them with you.
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