Home sales in Chattanooga rebounded last month after January sales fell below year-ago levels for the first time in five years.
Chattanooga Realtors sold 642 homes during February, up 8.6 percent from a year ago. Last month's gains reversed January's drop in sales and left home sales up 2 percent for the first couple of months of 2017.
The median price of homes sold last month through the Greater Chattanooga Association of Realtors also rose by 6.7 percent over a year ago to $163,000.
Chattanooga home prices, on average are still more than 23 percent below the U.S. average. But rising prices and the likelihood of rising mortgage rates should encourage both homebuyers and homesellers to get in the market.
"These are amazing increases in prices," said Mark Hite, a Realtor with Keller Williams and president of the Greater Chattanooga Association of Realtors. "This will eventually become a drag on the market, but for now we're still plowing ahead with higher sales and higher prices."
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Read moreSuch gains are coming at a cost for homebuyers, however. The inventory of homes on the market is down by more than 23 percent from a year ago to only 2,967 homes, or a 3.6-month supply in Chattanooga. The number of new listings on the market in February was down 15 percent from a year ago, cutting the inventory of homes to only half as many as two years ago.
"If you are thinking of buying, you need to move now before interest rates go up," Hite said. "If you are thinking about selling your house, this also is a good time because the supply of homes on the market."
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