After several hours of analyzing market data from our MLS database the market trends for Smoky Mountain real estate are unmistakable. During every one of the months of the first quarter of 2006, the number of units, the total dollar volume, and the average sales price for closed residential transactions were all higher than those values for the same period last year. During the second quarter, only in April was the 2006 total dollar volume lower than during 2005 but the number of units sold were lower during two months of the quarter. In the third quarter of the year, total closed dollar volume and the number of units sold were lower than the previous year during two of the months. Now that we are 2/3 of the way through the 4th quarter it is worth noting that the total dollar volume, the number of units sold, and the average sale price were ALL lower during the months of October and November and not only by a small amount. The number of units reported by member firms as being sold during these two months is almost 23% below the same period last year and the total dollar volume of sales during the months of October and November combined was over $31 million lower than during the year before. While it may be possible that December will mark a turnaround that remains to be seen. For my full chart based analysis of the prices for residential real estate in our area please click here.
What are we to make of all of this? Obviously this isn’t great news for sellers of real estate that can’t wait until a kinder and gentler market takes form. Like most of the United States, the Sevier County area is significantly below the unsustainable pace of last year. If however you are a potential buyer you really couldn’t ask for better circumstances. With many houses on the market for a longer period of time sellers are willing to take less and the super hot market of last year seems a distant memory. Remember the buyers of last summer who were frustrated because every time they made an offer on a home it was already sold forcing them to make offers on property sight unseen and with no contingencies? The sad part is that folks who were successful in purchasing property almost anywhere in the United States during 2005 are likely not going to be in a positive position if they need to sell at current prices. Of course, real estate has traditionally been a long term investment, not one suited for short term holding periods. The real estate flippers of the past few years are pretty much gone now – as likely is that opportunity for the near term future.
All of the news isn’t negative however! I have noticed that activity levels have picked up recently and our firm continues to be number one in our market as you can see by following this link to the sales ranking of all of the firms in our area. If you are interested in purchasing properties at prices that we haven’t seen in a while please contact us before they move back up!!