Published September 6, 2022
Why You Shouldn’t Worry About Falling Prices
Memphis home prices aren’t falling and here’s the reason why.
The media keeps talking about our shifting market and falling prices, but I’m here to report that prices are not falling in Memphis. What’s falling is the rate of increase.
Prices used to go up 12% to 15% yearly, but now they’re only climbing by 6% to 10%. However, if interest rates are going up, why are prices still rising? The reason is that the housing supply is very limited. We have a shortage of around 2.4 million homes nationally.
"For prices to drop, our supply would have to rise."
The National Association of Realtors defines a balanced market as having a six-month supply of homes. If there’s more than that, it’s a buyer’s market, and less means it’s a seller’s market. Right now, Shelby County has a 1.3-month supply of homes. If no new homes were listed, everything available now would be bought within 1.3 months.
East Memphis, downtown, and midtown have a 1.9-month supply; Collierville and Germantown have 1.3 months; and Barlett, Arlington, and Lakeland have a one-month supply.
If you're considering selling, let us know because doing so is a little easier right now. If you’re thinking about buying but are afraid of prices dropping, don’t be. The only way prices could drop is if our supply rose, and for that to happen, a bunch of new homes would have to be built, which won’t happen anytime soon.
If you have any questions, feel free to call or email us. We’d love to help you navigate this market.
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