published Sunday, June 27th, 2010

Market showing signs of improving


by Tamara Best
  • photo
    Staff photo by Dan Henry A builder walks past a new home under construction at Whisper Creek, a subdivision of Windstone, located on the Georgia-Tennessee state line.

HOMEBUILDERS ASSOCIATION OF SOUTHERN TENNESSEE

Not-for-profit trade association comprised of professional builders, developers, and associated firms who are involved directly or indirectly in home building, remodeling, and light commercial construction.

CHATTANOOGA ASSOCIATION OF REALTORS

The Chattanooga Association of Realtors is a Realtor association serving the needs of Realtors in Southeast TN and Northwest GA.

Hard hit by the economic downturn, real estate is attempting to lift its way out of the recession one house at a time, and local homebuilders and agents said they are optimistic for strong sales through the year's end.

"We're probably returning to a normal market," said Randy Durham, president of the Chattanooga Association of Realtors.

"This past year's sales were higher than any year's before 2002," he said, noting that 2003-07 were exceptionally high levels. "We're seeing a stabilization in prices and an increase in appreciation."

Jay Bell of Bell Development said he is also seeing signs of improvement. "I'm seeing the market come back. It's slow and sporadic, but it's coming back," he said. "A lot of times, I can sign the first offer that comes across my desk. I couldn't do that in 2007."

Mr. Bell said that having several properties at different price points helps weather tougher times, noting that younger people and couples are now increasingly becoming buyers.

"They are over the fear now. They are ready. They can't run and hide from that need," he said of many young couples who buy as they look to expand their families.

Teresa Groves with the Homebuilders Association of Southern Tennessee said homes that are $250,000 or less always do well and people still want nice amenities.

Mr. Durham said that though houses in the $250,000-and-under price range sell well, he expects sales in the median price range, near $130,000, to flatten out.

In addition to homes in the $250,000-and-under range selling well, townhouse sales also are rising as baby boomers who are looking to downsize sell their homes, Mr. Bell said.

Though insiders said there is progress, Mr. Durham said there has been one area that has not seen much improvement since the recession began.

"The second-home market is not doing as well as it did before. Neither are vacation homes," he said. "I'm not sure when we will have a return to that."

Still, Mr. Durham said brighter days are on the market's horizon with low interest rates, good inventory and solid prices combining to help fuel sales.

"The best of the year is ahead during the summer," he said.

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