NASHVILLE, Tenn. (WKRN) — It’s been a wild year in real estate. Prices skyrocketed, interest rates shot up, and realtors say that the show is not over yet.
Take a look at this huge change in 12 short months. In November 2021, there were 4,027 closings. But last month, that fell to 2,493 — a whopping 38% drop in closings in one year.
Sales tell the same story, according to Greater Nashville REALTORS. There were 3,112 pending sales in November 2021, but last month, that number was 1,776.
Steve Jolly, 2022 president of Greater Nashville REALTORS, says the interest rate hikes added $1,000 to the average payment, which led to this slowdown.
“That’s really the cause of that slowdown. And once interest rates come back down, you’ll see that demand and that sales volume pick back up,” said Jolly.
Even though closings and sales are down year to year, ironically, home prices are staying up. November 2021 saw a median price for a single-family home at $425,000, and this past November was even higher at $460,000.
“The reason why they’re holding steady is that demand is still stronger than supply. We need more homes in this market at all price levels, and that will help reduce some of the inventory constraints that we have. And that’s what we really need, and that’s why prices are really holding up – just demand is still strong out there.”
But something that is starting to soften is people interested in jumping into the real estate biz. When the market was steaming hot, Jolly says that his organization was seeing 100 new members a month, but that has since leveled out too.
“This year, it’s starting to slow down a little bit. We’re probably seeing somewhere in the neighborhood of 80 folks joining real estate. But it ebbs and flows as the market does.”