Absorption Rates in Rutherford County

It's amazing how much the media affects what people believe about the housing market no matter how many times we, as Real Estate Professionals, keep reminding people that Real Estate truly is local. I guess our job as Realtors is to put the facts out there and hopefully enough people will catch on.

So what are the facts? Well, I'm not going to paint a rosy picture. The Murfreesboro Real Estate market is definitely down from record-setting years like 2005. But so much depends on price points, neighborhoods and current inventory levels available combined with the rate of absorption.

Looking at 2008 vs. 2007 in all of Rutherford County, for existing homes, the average list price for the period between Feb 2008-July 2008 was $170,345 with an average sale price of $167,412. For the same period (Feb-July) of 2007, the average list price was $165,644 and average sale price was $163,482. For new construction (built 2007+), the average list price for the period Feb-July 2007 was $216,419 and the average sale price was $216,544. The reason the sale price is slightly higher could be for upgrades, builders offering closing costs, etc. Between Feb-July 2008, the average list price was $218,677 and the average sale price was $216,735 so new construction hasn't changed much in the past year.

The current Rutherford County Absorption Rates for existing homes range from 3 months (in the <$100,000 range) and up to 96 months for the $1 million plus range. Quite a difference. A balanced market is generally considered to be around a 6 month rate of inventory, i.e. neither a buyers nor sellers market. Currently, we're seeing this shift in Rutherford County around the $175,000 mark, where we jump from a 6 month supply around $150K up to an 11 month supply at $200K. Remember though, this is county wide. Things like school zones, neighborhoods, etc will affect these numbers, sometimes drastically.

The $100,000 range and under is a prime place to be because you no longer can build anything for that in Rutherford County which is why you will not see any listings under that for new construction. For the $150,000 and less range, it is still a seller's market believe it or not with inventory levels floating between 3-6 months. We begin to see the shift in New Construction once we reach the $200,000 to $250,000 range but not much. It still hovers around the 6-7 month level up to $400,000. The good news is that the supply of new constuction is actually down about 25% right now in Rutherford County which will help correct the market sooner rather than later.

For more information on absorption rates and inventory levels for all price ranges in Rutherford County, please email me at kimbrogli@comcast.net or call me direct at 615-330-0043.