EMBRACING THE CURRENT REAL ESTATE MARKET
After a steady decline to start the year, mortgage interest rates have crept back up over the past few weeks due to better than expected US economic news. The expectation is still that rates will decline throughout 2024 and into 2025. However, the rate and significance of this trend will likely be longer and slower.
Despite slightly higher interest rates and higher sales prices, the number of homebuyers seems to be slowly increasing as we enter the spring. The overall demand for housing remains very high in the Knoxville area, driven mainly by a robust job market and a favorable cost of living relative to many other parts of the country.
We’re also seeing more homebuyers actively looking to purchase homes who have been patiently waiting on the sidelines for the past 3 to 4 years. Most of these people say their motivation to buy a house right now is tied to changes in their families and personal lives.
From a home seller’s standpoint, the number of days on market continues to rise. However, average home prices still remain higher than they were at this time last year.
We expect the overall housing inventory to rise this year. If this inventory rises enough, it could negatively affect home prices. That said, we are still quite far from that scenario coming to fruition, with our local housing inventory at 1/3 of what it was in 2018/2019.
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