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Well I'll be Darned. The sky is falling!

By
Real Estate Agent with Coldwell Banker Snow and Wall Affiliate Broker 00301006

The statistics prove it.  The sky really is falling.  This should come as no surprise to anyone but the real estate market in middle Tennessee is continuing a downward trend.  The average days on the market in Rutherford county for residential properties for 2008 as of 7/1/2008 is 83 compared to 70 in 2007 for the same time period.  Eighty three days on the market of course is considered a dream market for some other areas that are currently experiencing harder times.  Nevertheless, the sky is falling and if its falling here its falling harder in those areas.

"Real estate markets are cyclical" you say?  Indeed they are.  Thats why I've compiled data for the same period covering the past ten years.  Check these graphs out to see the cycle.

Still not convinced?  I don't blame you.  Check this one out.

Ten year trend of Residential Units Sold in Rutherford County Tennessee  We are now down to the lowest sales level in ten years.

So, you see the sky is falling.  The question is how far will it fall before we see a turnaround.  Lots of folks are guessing so I'll join the throng.  I base my guess on the fact that there has to be a price correction before we see a turn around.  See the following graph.

Ten year Price Trend for Residential Units Sold in Rutherford county Tennessee

I'll take the middle ground and say that average price will have to adjust to 2003 - 2004 levels before the sales begin an upward climb.  Of course there are two other factors that really are guesses that have to be calculated to determine where the bottom is or will be and those are inflation and property appreciation rates.  Assuming inflation plus appreciation will be 6% the bottom should be around $140,000 for the average sales price before we see a turnaround.

Think I'm an idiot or a genius?  You'd be wrong in either case but let me know what you think.

Statistical data from the Middle Tennessee REALTOR Multiple Listing Service, RealTracs, was used to generate these graphs.

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