4 Knoxville, TN Housing Market Trends You Need to Know
The Knoxville real estate market is possibly one of the hottest in the country. As a seller, knowing the Knoxville, TN housing market trends is just as important as preparing your home for sale.
As with other industries, COVID-19 caused major disruptions in the national housing sector. Knoxville was certainly not spared from the pandemic, and its real estate market shuttered due to inactivity and uncertainty just like everywhere else. However, East Tennessee’s largest city has been more resilient than many of its neighbors.
Here’s what you need to know about Knoxville’s housing market, and what you can do about it as a seller.
4 Must-Know Knoxville, TN Housing Market Trends
1. Number of Homes For Sale Decreases
According to the Knoxville Area Association of Realtors, the number of homes on the market in Knoxville fell below 2,400 for the first time since July. A lack of houses for sale meant that there was not enough inventory to satisfy buyers’ demand. As a seller, this should come as good news to you.
When inventory levels are low, there is low competition for sales! Be prepared to receive a lot of offer letters in your mailbox. The fact that your home will be one of the few on the market can help you control the price. Consider your options and move at a pace that is most convenient for you.
2. Home prices continue to rise
The Knoxville housing market has seen an influx of people looking for homes in the last few years, which has led to an increase in the demand for homes. This has driven prices up—both median listing prices and the number of days on the market.
Compared to a year ago, the median home sale price last August was $289,000, which is an increase of 22.2%. Goldman Sachs expects home prices to rise 16% by the end of 2022, while Freddie Mac anticipates 16.9% growth in 2021 and 7% growth in 2022. Making use of this trend when pricing your home in Knoxville, TN will put you at an advantage.
3. Mortgage Rates remain low
Comparatively to how it was in the previous years, mortgage interest rates have been nice and low lately. In January of this year, the average rate on a 15-year fixed mortgage was only at 2.2%. Economists believe interest rates will remain around 3% in 2021, which is still relatively low.
A lower interest rate will motivate more buyers to buy your house. If rates rise later in the year, just expect your house to be on the market a little longer. In fact, mortgage rates are expected to rise next year. So, even though housing prices will remain stable, home sales will likely fall because of the decreased purchasing power of first-time homebuyers.
4. Rentals Receive An Influx Of Demand
Finally, one of the housing market trends rental property owners can enjoy is the influx of demand for rentals. Real estate activity in the area is booming, and the numbers indicate that many people are moving from big cities to Knoxville. New York City, Los Angeles, and Chicago are the top three big cities where people move from.
Without an adequate inventory, more people will need to rent. As home affordability continues to increase, a smaller inventory will become more competitive, forcing more people to remain renters, even if they can afford to buy. This will result in higher rents over the next year.
By partnering with a professional real estate agent, you can take advantage of the current market trends.
If you’re ready to sell your Knoxville home, contact a local expert today and discover the home team advantage.
