Here’s your highlights from the July 2023 real estate data. The local real estate market continues to hold relatively steady despite the volatile mortgage rates. In July, contracts in Rutherford County were up +20% YOY, while closings were down -11.5%. Currently we’re down -17% YTD in closed sales compared to 2022. Median price per sq.ft. is hovering, back up slightly to $212. Inventory rose for the fourth consecutive month, but 50% of the active inventory is new construction. Read on for our in-depth look at the most current local market statistics.
The local real estate market in Rutherford County continues to show resilience, even in the face of fluctuating rates. In July, contract activity experienced a notable increase of 20% compared to the same period last year. This surge in contracts indicates a healthy demand for housing, as prospective buyers continue to explore opportunities. It’s important to note that despite the positive contract activity year-over-year, looking at the monthly data we’ve seen four consecutive months of decline.
When we consider the broader picture of year-to-date closings, we see what is shaping up to be a loaded cannon. Cumulative closed sales for the year are currently at 3497, down by 17% compared to 2022. We’re currently on a similar trajectory to that of the 2015 local market. Then, mortgages rates were hovering around 4%, slowly working their up to 5%, before steadily dropping to below 3% post-covid and creating the frenzied markets of recent years. This pent up demand due to the recent rate hikes has us poised to launch into yet another frenzied market if/when rates dip back to a historically favorable rate of 5-6% 30-yr FRM.
Mortgage interest rates are indeed a critical factor influencing a real estate market’s trajectory. Looking ahead, predictions from major trade associations (Fannie Mae, MBA, NAR) all indicate a potential easing of rates. Their forecasts suggest a gradual decrease from the current levels, with rates projected to reach 6.63% this quarter and potentially dipping further to 6.27% in the fourth quarter. As inflation trends are closely tied to mortgage rates, any developments in inflation could impact the future rate landscape.
Median price per square foot in Rutherford County has maintained a relatively stable trajectory. Despite slight fluctuations, the median price per square foot currently stands at $212. Interestingly, this figure has experienced a marginal increase in the past month. This subtle uptick suggests that while prices are not experiencing a rapid acceleration like we saw in 2021-2022, we are still seeing a gradual appreciation of home values.
One of the standout features of the current real estate market in Rutherford County is the inventory situation. Inventory levels have risen consistently for the fourth consecutive month. However, it’s crucial to recognize that approximately 50% of the active inventory is comprised of new construction properties. This statistic holds significant implications. If we were to exclude new construction properties from the equation, the available inventory would be considerably lower, likely exerting even more upward pressure on prices.
In this dynamic market environment, prospective homebuyers and sellers face crucial decisions. The current scenario presents a unique opportunity for buyers to capitalize on a less contentious market. And while rates are indeed much higher than last summer, there are numerous programs available to improve them temporarily, with refinancing being a more permanent solution once rates improve. Meanwhile, waiting for rates to decrease further before buying may come with its own set of risks, including potential bidding wars and higher home prices. The adage “marry the house, date the rate” rings particularly true here. While it’s understandable to have concerns about higher rates, it’s worth considering the potential long-term benefits of making a move now.
Whether you’re a prospective buyer eager to secure a home at a relatively stable price point or a seller contemplating the optimal time to list your property, these insights offer valuable guidance. Remember, the real estate landscape is ever-evolving, and staying attuned to the data and trends will empower you to make the best choices for your housing journey. We’ll be back next month with updated insights. In the meantime, we invite you to stay informed about local real estate trends. Please consider following @murfreesbororealestate on Instagram, TikTok & YouTube. As always, if you need any assistance, you can always contact John Jones Real Estate at 615-867-3020 to put our LOCAL market expertise to work for you. It would be our pleasure to serve you.
