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Home Sales Report
May 2024
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East Tennessee home sales declined 0.1% from the previous month, but increased 5.2% from a year ago.
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The median sale price was $365,000 — up 8.96% from the previous year.
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Total housing inventory increased from the previous year – up 44.2% from a year ago.
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Half of the homes sold were under contract in 13 days or less, up from 8 days a year ago.
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51.52% of homes sold for the asking price or above, with 27.4% selling for more than the asking price. 12.8% sold for at least $10,000 over asking and 3.4% sold for at least $25,000 over asking.
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The sale-to-list price ratio increased from last month to 98.6% – down from 98.8% a year ago.
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New construction represented 13.5% of total home sales.
East Tennessee REALTORS® reports home sales data using a seasonally adjusted annualized rate (SAAR), a statistical measure of home sales that takes into account typical seasonal fluctuations in the real estate market, such as increased home sales during the spring and summer months, by adjusting the data to provide an annualized rate. This rate represents the projected number of homes that would be sold over a year if the current sales pace were to continue.
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What's the Outlook? After a strong showing in April, home sales remained at a high level in May. Despite higher mortgage rates, the increase in home sales has led to pending listings being up 5.7% from the previous year across the region. Although still low by historical standards, inventory levels are appreciably higher than a year ago.
Knox County saw home sales increase 10% from the previous year – over the past few months Knox County has continued to see home sales increase, however this month is showing a slightly lower increase than April 2024.
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Tennessee Advisory Commission on Intergovernmental Relations (TACIR) Releases Housing Report | |
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House Joint Resolution 139 passed in the 113th General Assembly requested a study on impact fees and their relationship to housing affordability. This study was completed and published on May 29, 2024.
The Commission highlighted the need for local governments to use land use tools to encourage housing production. They also recommended the state to offer an incentive to local governments who adopt zoning reforms to promote housing. The state and local governments are advised to mitigate the effects of zoning reforms on existing residents by adopting new policies. These are just a few of the recommendations provided in the full report.
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Housing Supply Accelerator | |
The July 2024 national rent report was published by Apartment List on June 26, 2024. This report showed that the national median rent is $1,411. As of Q1 2024, the Knoxville Metro Area had an average rent of $1,448, almost even with the national average. | |
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The report also identified the top three concerns regarding housing supply. In our region these were identified as being the lack of affordable workforce housing first, then the lack of affordable units for low and very low-income households, and finally the insufficient range or variety of housing options. All three have been topics of discussion in our 12 county region in the past few years.
The report provides a path forward to address these identified challenges and highlighted the use of Counselors of Real Estate right here in Knoxville in 2023 through the transforming neighborhoods program.
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Market Pulse Survey:
Q2 2024 Results
Results from the latest iteration of East Tennessee REALTORS® Market Pulse Survey indicate buyer and seller traffic across East Tennessee continued to improve in the second quarter of 2024, however a decreasing share of REALTORS® expect home prices and home sales will increase over the next year.
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- Buyer traffic decreased nominally in the second quarter of 2024. Sixteen percent of respondents reported seeing more buyer traffic than this time last year, compared to 21% last quarter. Similarly, seller traffic decreased with 17% of respondents reporting more seller traffic than this time last year, compared to just 20% last quarter.
- REALTORS® expectations about buyer and seller traffic over the next three months diminished in the second quarter of 2024 after multiple quarters of improving expectations. 22% of respondents expect more buyer traffic than this time last year, compared to 32% last quarter. Expectations about future seller traffic, reduced with 22% of respondents expecting seller traffic to increase compared to this last time last year.
- The typical home sold in Q2 2024 received an average of 2.7 offers, less than a year ago but up from 2.2 offers in Q1 2024.
- There was a dramatic decrease in the percentage of REALTORS® who expect home sales will increase over the next year with only 35% believing this whereas in Q1 2024 51% REALTORS® expected an increase in home sales. This quarter the percentage of REALTORS® expecting an increase is closer to Q2 2023.
- 56% of REALTORS® expect home prices will increase over the next year, while 17% expect no change and 27% expect prices to decline over the next year.
- All-cash sales represented 29% of all home sales in Q2 2024, which has remained stagnant over the past year.
- 53% of buyers in the past three months waived at least one contingency in their purchase contract, down from 55% a year ago and 60% in Q1 2024.
- Among homes that went under contract in Q2 2024, 10% had an appraised value that was less than the contract price. This has remained in the same range for the past year.
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"The first half of the year did not meet expectations regarding home sales but exceeded expectations related to home prices," explained Yun. "In the second half of 2024, look for moderately lower mortgage rates, higher home sales and stabilizing home prices."
– Lawrence Yun, Chief Economist at NAR
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The spring selling season is in full swing with housing inventory increasing by 11% from May to June across the entire East Tennessee REALTORS® footprint. Roane, Anderson, and Knox counties experienced the largest monthly increase in inventory, while Scott was the only county to experience a monthly decline. | |
Stay up-to-date with the most recent information about East Tennessee's housing market. Here's the latest from local media: | |
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Mortgage Rates Surpass Seven Percent
Mortgage rates dropped below 7% in June, hitting the lowest level in almost 3 months. According to Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed mortgage rate (30Y FRM) averaged 6.86% for the week ending June 27, 2024, compared to an average of 6.71% this time last year.
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What's the Outlook? According to NAR Deputy Chief Economist there is not an expectation of dramatic changes in mortgage rates in the coming months. The slight decrease in mortgage rates can likely be tied to the last PCE and CPI reports that were better than expected. Overall, we expect to continue to see mortgage rates close to 7%. | |
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Market Pulse is a monthly research newsletter providing a rundown of the latest housing
and economic research and analysis across East Tennessee.
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