The Memphis Area Association of Realtors (MAAR) has released end-of-year 2017 sales and market statistics. This information is based on recorded deeds in Shelby, Fayette, and Tipton counties.
Sales and Prices up slightly for the year
2017 saw a 5.8% increase in total residential sales, with around 5% increases in median and average sales prices. Inventory shortage has sparked somewhat higher prices, and I don’t expect much growth for 2018, especially with uncertainty about the new tax bill. I will get into inventory and that impact later.
As you know, my market niche is Midtown, Downtown and East Memphis. If you are not in those general areas, you can click to download the full report and and see how you stand in comparison to other areas. Prices in all 3 areas showed rises in the 4-5% range. East Memphis led in unit sales with a 7.5% increase, with Downtown sales off 3.4% from 2016. A number of my customers were empty-nesters and retirees wanting to buy in the core city: Midtown and Downtown. I expect more activity in the condo market as folks seem willing to downsize as they relocate.
It’s All About Inventory
If you know Realtors, the typical chit-chat question when you see them is, “how’s the market?” You are likely to get an answer about inventory. Listings are way down. If listings are down, sales are down. The only reasons properties stay on the market more than a week or so is a tendency to over-price in relation to value and condition. Conditions are still great for purchasing. 4190 current listings translates to about 1.3 listings per licensed MAAR agent. Here’s a more graphic example of inventory shortage:
What’s In Store For 2018?
My predictions for 2018:
- The new tax law may impact some Buyers’ decisions, due to changes in the standard deduction vs. mortgage interest deductions (which are still intact up to $500,000 mortgages).
- Interest rates will rise slightly, but not enough to have a great impact on sales or motivated buyers.
- Prices will stay flat or decline slightly overall. We are not in a housing bubble.
- More sellers will decide it is the right time sell and move on with their futures.
- We will see increased density in popular core-city areas.
- We will continue to see more suburbanites migrating to the core city for closer proximity to their lifestyle choices: sports, arts, theater, restaurants.
- I am going to still be out there promoting the core City – Midtown, Downtown and East Memphis and helping my clients find the best deals.
I enjoy conversations about the future of Memphis residential real estate, and the future of Memphis in general. Let’s make it a part of the 2018 plan to get together for coffee, lunch or maybe even a drink, for some lively conversation.