published Friday, August 12th, 2011

Home prices fall to 7-year low despite sales gain

Staff Photo by Tim Barber<br>
A line of new homes with distinct facades offer the buyer deals in Whisper Creek at Windstone. Several signs indicate slashes in prices from the $300's to the $200's.
Staff Photo by Tim Barber<br> A line of new homes with distinct facades offer the buyer deals in Whisper Creek at Windstone. Several signs indicate slashes in prices from the $300's to the $200's.
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    Jennifer Grayson, president of the Greater Chattanooga Association of Realtors

Chattanooga home sales rose this spring from the depressed level at the start of the year, but the price of existing homes fell during the second quarter to the lowest level in more than seven years.

The median price of existing homes sold this spring in the Chattanooga area fell by more than 8 percent from a year ago to $115,500 -- the lowest level since the start of 2004, according to a new report from the National Association of Realtors.

Chattanooga was among 109 of the 151 metro areas included in the national report where home prices fell from year-ago levels during the second quarter.

The Chattanooga Association of Realtors reported that nearly 30 percent of the home sales in the second quarter were of foreclosed properties, which are typically priced below conventional home sales.

Chattanooga's housing market remained more affordable than most of the country with a median price of existing homes nearly one third below the U.S. average.

Home prices in Chattanooga did not fall as much as harder hit Southern cities, including Atlanta and Memphis where home prices have fallen below the average price in Chattanooga, Realtor figures show.

Local Realtors said they were encouraged by the 27.5 percent gain in home sales from the first quarter to the second quarter of 2011.

But Jennifer Grayson, president of the Greater Chattanooga Association of Realtors, said she remains worried about the uncertain economy and the prospect of Congress possibly removing the mortgage interest deduction for homebuyers.

"For me, it's encouraging to see the market arrow move upward," she said, noting that the 1,536 residential units sold this spring was up by 331 units from the winter period. "While I feel certain that the worst of the recent recessionary period has now passed, we are still concerned about obstacles in the lending market, and what legislative changes may result from the recent debt ceiling agreement."

Dan Griess, president of the Chattanooga Multiple Listing Service, said "there remains a level on uncertainty abut the pace of sales going forward."

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about Dave Flessner...

Dave Flessner is the business editor for the Times Free Press. A journalist for 35 years, Dave has been business editor and projects editor for the Chattanooga Times Free Press, city editor for The Chattanooga Times, business and county reporter for the Chattanooga Times, correspondent for the Lansing State Journal and Ingham County News in Michigan, staff writer for the Hastings Daily Tribune in Nebraska, and news director for WCBN-FM in Michigan. Dave, a native ...

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NoMyth said...

Realtors are the most overcompensated people in the U.S. economy and gleefully contributed the creation of the housing bubble. A 3-6% commission for posting some photos and a description? What a joke. Americans should demand a standardized state-wide home purchase agreement and listing website and eliminate this unnecessary tax pilfered under the protection of the auspices of the union-like National Association of Realtors.

August 12, 2011 at 8:03 p.m.
Eric said...

Realtors do more than post photos. A good realtor uses their knowledge of the market to steer clients into the right house and knows when a price is too high. There is nothing about a realtor's commission that is a "tax." No one is forced to use a realtor. Buyers can learn all of the information on their own. A realtor is used for convenience. Furthermore, everything is negotiable, including the commission. And the only way a standard listing website would work is if all sellers register on the MLS, which not everyone does. Personally, I didn't use a realtor. I searched for a home for 2 years and ended up buying directly from the builder. However, I know how long the process took and the learning curve I faced, and I certainly understand how a good realtor is well worth the 6% commission (split among both agents) that the seller pays.

August 12, 2011 at 11:05 p.m.
Oz said...

You can negotiate the commission but you might get overlooked. If a realtor can make 6% vs.4%. Which house are they going to show? I sold a house myself 15 years ago and it was a pain. I used a realtor on the last house I sold.

August 12, 2011 at 11:26 p.m.
sarahberry123 said...

I just refinanced using "123 Refinance" and went from a 5.5/20yr to a 3.25/15yr. Monthly payments went down by about $100 but overall savings over the life of the loan are over $60,000. Definitely worth it in my opinion. Learn more about refi before you do one.

August 14, 2011 at 5 a.m.
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